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Look beyond the NHS's headline deficit and it soon becomes clear that efficiencies and productivity can only do so much.

Academic medical centers (i.e., teaching hospitals) and academic medical practices are under pressure to control costs to compete with for-profit health care institutions. The authors explain how academic physician managers who want to control costs wisely must first understand the cost structure of the medical center or practice and compare that structure with those of for-profit institutions. Doing this requires a firm understanding of how to use a valuable tool, financial statement analysis, to assess an institution's health and performance. Such analysis consists of calculating a variety of financial ratios (e.g., operating income divided by revenues; net income divided by total assets) and then comparing them with the corresponding ratios that are considered industry norms. Three types of financial statements (defined in detail) lend themselves to this approach: the balance sheet, income statement, and statement of cash flows. The authors define standard financial ratios, point out their uses and limitations, and emphasize that a ratio's meaning derives from comparing it with the corresponding benchmark ratio in the industry as a whole. Ratios should be used not as the end point of assessing financial status, but as ways to identify possible problems that require further investigation. Analysis of trends of ratios over time within an institution is a complementary approach. The authors then discuss the use of ratios in three standard types of institutional evaluation: of performance, of liquidity and leverage, and of strategic planning. In addition, they present the financial statement of a fictitious academic medical center as an example of how to use ratios for financial statement analysis. The authors emphasize that the key to using the ratios they discuss and hundreds of others is first to decide what question needs answering and then to choose the relevant ratios to provide a basis for finding the answer.

A New York hospital has broken new ground in financing construction costs by selling the development rights above a new facility for a private condominium project.

A massive outbreak of polio in Bethlehem, Israel was the impetus that led the Holy Land Christian Mission to spark a drive to build a hospital facility there. Through a carefully planned direct mail campaign, face-to-face solicitation, and commitment, the overall total cash income for the campaign's first three months was up 161%.

Childrens' Miracle Network sees its telethon not as philanthropy but as a business-building event. Its approach has paid off in more than $170 million for childrens' hospitals.

Memorial Sloan-Kettering Cancer Center wanted a herd of higher quality donors. Following concentrated efforts with list segmentation, data processing, mailing packages with a human interest slant, and a change in renewal strategy, the center reached its goal. When it was over, the development department had turned a simple annual giving campaign into a refreshing multiple gift appeal.