Among the financial risks that the organization could take in the course of the operations include operational risk, legal risk, credit risk, liquidity risk and market risk (Carroll, 2009). The operational risk entails the financial loss incurred following technical failures in the hospital. Most of the operations in the health care organization involve the use of equipment and systems that are prone to failure and wearing out. Therefore, the organization needs to consider operational risk in the course of its operations.
Furthermore, the health care organization needs to consider the legal risk that involves financial loss arising from legal constraints such as lawsuits from patients (Cornett & Saunders, 2003). The organization needs to consider instances where it might face financial loses out of legal proceedings. In addition, the health care organization should take credit risk in the course of its operation. This risk involves financial loss when the organization fails to fulfill its obligations towards its financiers or suppliers (Carroll, 2009). The organization needs to be aware of the sovereign risk under credit risk that involves financial loss following complicated foreign exchange policies. In addition, should consider settlement risk also under credit risk where the organization might make the payments and the other partner fail to fulfill the obligations.
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An additional financial risk that needs to be taken in the course of operations includes liquidity risk. In some cases, the health care organization might be unable to execute transactions following issues that have been categorized into funding liquidity and asset liquidity. The organization might face financial loss following insufficient operational staff or funds to complete substantial operations in the organization. Market risk is the final risk that health care should take in the course of its operations. It entails financial loss following dynamic prices in the operations. Therefore, the organization should consider market risks in different investments involved in health care operations.
References
Carroll, R. (Ed.). (2009). Risk management handbook for health care organizations (Vol. 30). John Wiley & Sons.
Cornett, M. M., & Saunders, A. (2003). Financial institutions management: A risk management approach . McGraw-Hill/Irwin.
