Nurses Need to Learn The Business of Healthcare, Here’s Why
For nurses and nursing students, healthcare is centered around taking care of patients—as it should be. However, it's also important for practitioners to understand that at the end of the day, healthcare facilities are places of business. And like any business, a healthcare facility needs to make money to operate and continue serving patients.
If you're looking to implement education on the business side of healthcare to your nursing students, there are some things you should know first.
Teaching The Business Side of Healthcare: What Does It Entail?
There's a lot that goes into the business aspect of healthcare, from insurance claims and billing practices to budgeting and payment arrangements. These essentials are covered in detail in Chapter 10 of Advanced Practice Nursing: Essential Knowledge For the Profession (Fifth Edition) from Jones & Bartlett Learning.
Some key topics covered here that all nurses should have a basic understanding of include:
- Differentiating between private and government-managed care organizations
- Understanding the patient populations covered by Medicaid versus Medicare insurance
- Identifying how bundled payment arrangements can improve the quality and efficiency of care
- Explaining basic budget principles and their impact on healthcare.
Likewise, nursing students would be well served with formal education on such administrative topics as staff management, nursing informatics, and risk management.
The Importance of Business Education for Nurses
Some nurses will go on to pursue administrative and business roles. For those who do, it's common to pursue a Master of Business Administration (MBA) in addition to a more traditional nursing degree. For students hoping to work in nursing/healthcare administration down the road, it's never a bad idea to get a head start with some basic business education while in nursing school.
However, even for those who currently have no plans to pursue administrative roles, having a basic understanding of the business side of healthcare can be beneficial in a number of ways.
For starters, nurses constantly need to communicate and work with those in administrative roles in their everyday jobs. By having a stronger comprehension of how the business side of a healthcare facility operates, bedside nurses can more effectively and confidently communicate with these administrators and other decisionmakers—advocating for policy changes and other innovations (such as new equipment) that can directly improve patient outcomes.
Meanwhile, for nurses who do have aspirations to move into management and/or leadership roles, having a strong business knowledge can make the transition into this type of work an easier one. When schools prioritize teaching business to nurses, they can set these professionals up for more successful careers by giving them a competitive edge over nurses who don't have any business background.
Likewise, introducing students to the basics of business for nurses can expand their horizons to a whole side of healthcare they may not have otherwise considered. This kind of education is especially important for nurses who may go on to open their own facilities as entrepreneurs.
According to a study published in the Journal of Advanced Nursing in January 2023, only 0.5%-1% of all licensed nurses are working independently—though nurses with strong business acumen can very well start their own ventures as private hospice caregivers, specialized care providers, wellness coaches, and the like.
How Nurses Can Use Business Acumen in the Field: An Example
Nurses of all backgrounds can put business knowledge to work in the field, with some specific examples being touched upon in Chapter 10 of the Advanced Practice Nursing text. For instance, practice nurses and nurse specialists have successfully used technology to help reduce the number of sitting nurses required to monitor dementia patients. This was done by implementing a remote video program that allows just two nurses to effectively supervise five high-risk dementia patients, rather than staffing a sitting nurse for each individual patient.
By being aware not just of patient needs, but of staffing requirements and technologies available to optimize staffing, nurses with sharp business and budgeting knowledge can play an important role in keeping facilities running smoothly.
Implementing Business Education: Best Practices for Nursing Instructors
While business education will never be your biggest focus as a nursing instructor, you can benefit your students greatly by at least covering business healthcare basics in your classroom.
Take the time to explain to nursing students why understanding the business aspect of healthcare is so important—especially as it relates to advocating for changes that will improve their ability to care for patients. Nurses cannot expect to effectively communicate the need for new equipment or other changes if they don't understand how a healthcare facility's budget and basic operations are handled.
Make sure that you also discuss potential career advancement opportunities that require healthcare business knowledge (such as healthcare/nursing administration and other leadership roles).
Students who go on to work as nursing administrators, for example, can make nearly $32,000 more per year than the average registered nurse, according to the U.S. Bureau of Labor Statistics. In fact, those who go on to pursue MBAs as Nursing Managers can make a median salary of $115,287-$121,464. And because these professionals don't work directly with patients, working in these roles can help nurses avoid dreaded bedside burnout that has become so common in the field.
From there, opt for comprehensive course materials that will help you cover the most important topics in the business side of healthcare. Advanced Practice Nursing: Essential Knowledge for the Profession (Fifth Edition) by Jones & Bartlett Learning covers some of the most important business topics in nursing in a way that's engaging and accessible. With an entire chapter dedicated to healthcare business essentials, students can gain a better understanding of how healthcare facilities handle their budgets and staffing, as well as important aspects of billing and insurance.
By spending enough time on the basics of business in healthcare, nursing educators can empower students to better advocate for themselves and their patients. Meanwhile, exposing students to the business side of healthcare can open up new doors of opportunity for future careers as nursing administrators, program directors, chief nursing officers, and the like.
Qualified instructors are invited to download a digital review copy of Advanced Practice Nursing, Essential Knowledge for the Profession, Fifth Edition in consideration of course adoption.
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