Health Care Finance

1.5 credits · Graduate

This case-based course focuses on the financial analyses that managers in the health care industry use to make strategic and operating decisions. We will begin by examining how health insurers design and price their products and manage enrollees' medical expenditures. The reimbursement methods that public and private insurers use in turn affect how physicians, health systems, and other providers are organized and managed. Therefore, we will measure a health system's profitability by product/service line and examine how reimbursement can be used to align physician and hospital incentives. In the second half of the course we will review bond financing, estimating the value of drugs in development, and how firms set prices. We will then review and apply three different methods of valuing medical products/services and companies: the expected net present value of free cash flows, multiples, and the venture capital method.