Comparative Data

What is meant by common sizing?

Provide an example:

Common-sizing is the process of converting financial statement items to a common scale. Common-sizing aims to reduce the effects of different accounting choices and inflation on financial statements so that the statements can be easily compared among companies or overtime for a single company. For example, if two companies have different fiscal years, common-sizing would involve converting each company’s financial statements to a common scale (e.g., per month, per quarter, or per year). This would allow for an easy comparison of the companies’ financial performance.

What is meant by Trend Analysis?

Provide an example:

When analysts or investors talk about “trends,” they are typically referring to long-term movements in data points. In financial analysis, trend analysis is used to visualize and identify trends in data sets to make better-informed decisions (Harvey, 2014). There are numerous methods for measuring and identifying trends, but trend lines, moving averages, and index numbers are the most common. One of the most common ways to visualize trends is by using a trend line. A trend line is simply a line drawn on a chart to depict a data set’s direction and slope visually. For example, imagine you have a line chart that plots the monthly sales of a company over the past year. If you were to draw a trend line on this chart, it would show you whether or not sales have been increasing, decreasing, or staying relatively flat over time.

What is the difference between forecasting and projecting?

Forecasting is a method of estimating future events while projecting estimates of future events based on past trends (Soyiri & Reidpath, 2013). An example of forecasting would be predicting the sales for the next quarter, while an example of projecting would be predicting the next year’s sales based on the previous year’s sales.

What are the three common types of forecasts in a Healthcare Organization?

There are three common types of forecasts in a Healthcare Organization: operational, financial, and market.

Operational forecasting is used to estimate future service and staffing requirements. This forecast might be based on past data, such as patient volume and length of stay, or demographic changes, such as population growth.

Financial forecasting is used to predict future revenue and expenses. This type of forecast can be based on historical data, such as past revenues and expenses, or on economic trends, such as inflation rates.

Market forecasting is used to predict future demand for healthcare services in a particular geographic area. Demographics and economics can both influence a trend forecast.

Name the three criteria that must be met for true comparability.

Discuss each.

 The three criteria that must be met for true comparability are:

1. The items being compared must be of the same kind. The most common type of comparison is between companies, but comparisons can also be made between individuals, departments, or other entities.

2. The items being compared must be measured using the same units. This is important because it ensures that the data is directly comparable. For example, if two companies are being compared, but one company reports its revenue in euros and the other company reports its revenue in dollars, then the data is not directly comparable.

3. The items being compared must be measured using the same period. This is important because it ensures that the data is directly comparable. For example, if two companies are being compared, but one company reports its revenue for the year 2016, and the other company reports its revenue for the year 2017, then the data is not directly comparable.

What elements of consistency should be considered? 

Provide an example:

A few elements of consistency should be considered when analyzing comparative data. First, you want to make sure that the data is comparable, meaning that it is from the same time period and covers the same information. For example, if you are comparing financial data from two different companies, you want to make sure that the data is from the same fiscal year. Second, you want to make sure that the data is complete, meaning that all of the necessary information is included. For example, if you are comparing financial data, you want to make sure that both balance sheets and income statements are included. Finally, you want to ensure that the data is accurate, meaning that it has been verified and free from error.

Discuss the importance of comparative data and explain the healthcare manager’s responsibility when comparing data

Comparative data is important because it allows healthcare managers to see how their own organization’s performance compares to similar organizations (Miriovsky, Shulman, & Abernethy, 2012). This can help them identify areas where they may need to make improvements. Additionally, comparative data can be used to benchmark against other organizations to set goals and track progress.

When comparing data sets, healthcare managers need to ensure that the data is accurate and complete. Additionally, they should make sure that they are comparing apples to apples, meaning that they are only comparing truly comparable data sets. For example, if you are trying to compare the financial performance of two hospitals, you would want to make sure that you are only comparing hospitals of a similar size, in a similar geographic location, with similar patient populations.

Name the four common uses of Comparative Data.

Discuss each.

The four common uses of comparative data are:

1. To compare results over time (trend analysis). This is typically done to identify patterns or trends in data, which can help forecast future results.

2. To compare results across different groups or categories (common-sizing). This is often done to normalize data so that it can be more easily compared and interpreted.

3. To compare a company’s performance to its competitors (benchmarking). This can help identify areas where a company may need to improve its operations.

4. To compare a company’s performance to industry averages (industry analysis). This can help determine how well a company is performing relative to its peers.

Explain Standardized Data

Provide an example. 

Standardized data has been modified to make it easier to compare to other data sets. For example, if two data sets are both measured in different units, they can be standardized by converting them both into the same unit (e.g., converting both sets into percentages).

List your References:

REQUIRED

Harvey, A. (2014). Trend analysis. Wiley StatsRef: Statistics Reference Online.

Soyiri, I. N., & Reidpath, D. D. (2013). An overview of health forecasting. Environmental health and preventive medicine, 18(1), 1-9.

Miriovsky, B. J., Shulman, L. N., & Abernethy, A. P. (2012). Importance of health information technology, electronic health records, and continuously aggregating data to comparative effectiveness research and learning health care. Journal of Clinical Oncology, 30(34), 4243-4248.