a.

Defining revenue and revenue collection

i. Revenue
Is an increase in net worth resulting from
a financial transactions. In Government,
revenue is all amounts of money received
from external, or net of refunds and other
collecting transactions proceeds from
debt, sale of investments, agency or
private trust transactions, and intra
governmental transfers
ii. Revenue collection
Is the process of gathering, or compiling
income.
The process involves a number of
different institutions or companies public
as well as private and individual
sometimes agencies. e.g in TZ the main
collector is TRA but there are other
institutions such as; Local government,
agencies, magistrates or police force.
b. Identify various sources of revenue

Sources of revenue:
1.Tax revenue
2.Social contributions (Social securities)
3.Grants-noncompulsory transfers received by
government units from other government
units or from international organizations
4.Pay As You Earn (PAYE)
5.Property income (Interest, dividends, and
rent)
6. Sales of goods and services
Sources of revenue
Other types of nontax revenue that might
be received are;
• Fines
• Penalties
• Forfeits (surrender)
• Settlements arising from judicial
processes
c. Approaches used to collect revenue

Central government(TRA) tax collection, Local

government tax collection or Court
(Magistrate) order. Three levels at Local
Government; council headquarters
responsibility for tax collection rests to the
council treasury (headed by the Treasurer). At
the ward levels responsibility rests to the office
of the Ward Executive Officer (WEO), also
handles developmental issues, law-and-order
functions.
Approaches used to collect revenue
• In wards with greater revenue potential
there will be a ward revenue collector
(WRC) to support the WEO. At the village
level, the responsibility rests to the office
of the village executive officer (VEO).
• VEO is also responsible for supervising
village developmental activities and to
maintaining law and order and VEOs
often function as secretaries of the Village
Councils.
Approaches used to collect revenue
• Some councils have introduced new methods
to increase revenues from existing sources by
outsourcing some of the revenue collection to
private collectors to increase revenues from
existing sources.
NB:
• TRA collect from industries, companies, middle
business enterprises, for profit organizations
or consumers
• Court from Low misconducts rewards
d. Importance of revenue collection on improving
health care services
The importance of revenue collection in
improving health is to pool resources. Such
resources are;
 Pooling human resources; by paying salaries,
honoraria or other expenses to human
 Pooling equipments; beds, radiograph
machines, trolls, wheelchairs and many others
 Pooling supplies; medicines, antiseptics,
disinfectants, and many others
 Infrastructure and transport; buildings, vehicles
e. Health care revenue collection challenges
 

• Inadequate record keeping

• Inadequate capacity of staff to carry out
finance collection
• Lack of incentive
• Inadequate monitoring and supervision
• Lack of updates in cost sharing policy
guidelines
• Lack of financial accountability
• Poor utilization of data collected from health
facility
Key points
1. To run health services need revenue and should
be collected
2. There are various sources of revenue for health
care
3. Approaches to collect revenue are through
central and local government
4. Revenue is essential fo improving health care
services
5. There are challenges of revenue collection in
health care services
 
The end

Questions please
Session 2. Utilizing various tools used to collect
and keep financial records
a. Defining financial records
b. Identifying tools used for collection and keeping
financial records
c. Explaining the importance of keeping financial records
d. Fill in various financial records in the appropriate
account books
e. Balance the account books
f. Maintaining safe custody of revenue
g. Describing financial regulations that govern utilization
of funds
h. Preparing financial reports  
a. Defining financial records
Financial records
 Are formal document representing the
transactions of business, individual, or the
organization. Statement of retaining earnings
and cash flow, income statement, balance sheet
and tax return.
 Records are from conduct business activities
relating to financial management. The business
operation activities are transactions such as
purchasing, lending, payments, grants (or
donation) process
b. Tools for collecting and keeping financial records

NHIF, User Fees, CHF, DRF have tools for

operationalization by option
Tools for User Fee
-Cash collection receipts (ERVs, Fixed Fee
Receipts (FFR))
-Cash collection book
Tools for NHIF
-Membership ID card
-NHIF2A &B health provider in/outpatient claim
form & surgery claim forms
Tools for collecting revenue
NHIF 2D optical requisition and claim form
NHIF 6 monthly report form
NHIF 2C pharmacy prescription/claim
form
Tools for CHF
Membership ID card
CHF cashbook
Daily patient/cash ledger
Cost Sharing
Four health care cost sharing options in Tanzania:
-National Health Insurance Fund (NHIF)
-User Fees
-Community Health Fund (CHF)
-Drug Revolving Fund
i)National Health Insurance Fund (NHIF)
The National Health Insurance Scheme is the
outcome of a 1990-1992 study on the long term
options for financing health services in
Tanzania
NHIF
• Established by an Act No. 8 of Parliament
1999
• Commenced operations on 1st July 2001
(members) and employers starting to
contribute.
• Is compulsory and covers all public sector
employees.
• Membership principal members, their
spouses and up to four children and/or legal
dependants
Other schemes
Other schemes that also operates in
Tanzania; namely
• Social Health Insurance Benefit Scheme
• National Social Security Fund (NSSF)
• Private Health Insurance (registered
insurance companies which have
health insurance components)
Options
ii. User Fees
• Patient pays directly out-of-pocket for services.
• In public health facilities, cost is shared between
the user and the government. Users of the
service are required to pay half of the actual
price, another subsidized by the government.
• E.g, an individual comes to the facility and not
covered by insurance or any available health
benefit package, client pays from own pocket.
• User fees structure varies by districts and type of
facility.
 Options
iii. Community Health Fund (CHF)
CHF is a voluntary scheme, which enables a household to pay
when they have funds rather than at the time of illness, and
members are entitled to access services at the primary health
facilities.
CHF started in 1996 in Igunga district as a pilot scheme and
later expanded to other councils with the expectation of
covering the whole country.
scheme was identified as a possible mechanism granting access
to basic healthcare services to populations in the rural areas
and people working in the informal sector in the
country.
Its aim was not primarily to raise additional funds, but to
improve access to healthcare for poor and vulnerable groups
Options
iv. Drug revolving funds (DRF)
• It was a strategy to reduce drug shortage health
facilities in the country.
• Government offered initial funds to facilities
purchasing commodities and selling them at full
price.
• Later fund was revolving as capital for purchasing
medicines
• This program wasn’t sustainable because of poor
drug management, exemption and waivers policy.
Currently very few hospitals, faith based
organization facilities operate on
Reasons
 Introduction of cost sharing aligns with reform,
and is one alternative for improving healthcare
financing
 Deterioration of health services: Single source
of financing made it necessary to introduce
alternative options for cost sharing
 Cost sharing increases commitment and a
sense of ownership of the healthcare system
users and community
 Good bookkeeping needed for effective
financial management
NB: Health financing
Health facility operations require funds which
originate from different sources. These sources
can be grouped in two categories:
i. Hospital/facility internal sources, such as:
• Various health financing options, such as user
fees, drug revolving funds, community health
funds and National Health Insurance (cost
sharing).
• Hospital income generating activities such as
canteens, conference/seminar hall rental, etc
Health financing cont…..
ii. External sources, such as:
• Block and development grants; Personal
Emoluments (PE) and Other Charges (OC)
• Development partners, through basket funds
or bilaterally (e.g. USAID, Engender Health,
Elizabeth Glaser Paediatric AIDS Fund
(EGPAF), Intra Health, and other NGOs).
• Receipts in kind: donated food, linen,
mosquito nets, etc. (Note: sometimes this
support comes unsolicited)
Health financing cont….
• Community contributions, often in the form of
labour force. Eg construction or
rehabilitation of health facilities etc.
• It is important to distinguish between
reliable and less reliable sources of
funding so that you can make a realistic
plan for health activities.
Who Pays for Healthcare
• Government
• Health service consumers
Challenges encountered in collection of cost
sharing in Health facility
• Inadequate record keeping
• Inadequate capacity of staff to carry out finance
collection
• Lack of incentive
• Inadequate monitoring and supervision
• Lack of updates in cost sharing policy guidelines
• Lack of financial accountability
• Poor utilization of data collected from health
facility
Challenges with cost of Healthcare
• Limited resources as compared to health
demand
• Deterioration of health services
• Increase in population growth
• Economic recession, poverty, and other
socioeconomic factors
• Health sector reforms
• A search for alternative financing options
for health
Financial terminology
Financial Management:
A process of ensuring, all procedures and
regulations are followed and adhered to and involves
budgeting and accounting.
Bookkeeping:
Accounting for money by applying appropriate documents
throughout the entire financial management process.
Budgeting:
A plan specifying how much money will be allocated or
spent during a particular period on various categories of
expenses. It estimates total amount of money allocated for
a particular purpose during a specified period of time.
Terminology cont…
Accounting:
A recording financial transactions using a
variety of consistent documents/tracking
tools. Some of documents include:
Warrant of fund, Bank pay-in slip, Registers,
Ledgers, Local Purchase Order (LPO), issued
to suppliers instead of cash or cheques,
Contract agreements Claims or invoices. all
stand as evidences of purchased goods or
services (procurement act PPRA 2004)
Terminology cont…
 Various allowance claim forms such as extra
duty allowance and subsistence claiming forms
 Payment voucher (a form that bears
authorization of payments)
 Cash book (used to monitor cash flow)
 Vote book (a budget control book showing
commitments, timed expenditures, total
expenditure and the available balance)
 Exchequer receipt voucher (ERV) for cash
receipts
Accounting Procedures Related to Cost
Sharing for Healthcare
There are many procedures, but only
three will be discussed: Income receipt,
Payment and reporting procedures
i) Income Receipt Procedures
Enterprise should ensure that all money
receipt procedures are adhered to,
including:
• Use receipts for cash (ERV receipt book)
or by Fixed Fee Receipts (FFR)
Accounting Procedures…
Recording in cash book
 Cash received must be transferred into an income
register
 Cash or checques must be deposited in the bank
immediately
 Staff do not use money/cash from cash box directly
without proper procedure authorization
has following: a receipt, banking, raise voucher, write
cheque which authorize to cash
Cash reconciliation sheet
 Keep track of cash received and paid. Through cash
reconciliation process, one will be able to find out any
deviation from the organization’s financial regulations
Reporting procedure
 Report explains budgeted amount and the
amount received for planned activities, and the
way spent.
 Accounts value of services rendered to
exempted groups. And should be backed by
technical report of implementation, account
the planned activities, implementation
achievement, constraints during
implementation, and way forward.
Reporting procedure cont…

Report include quarterly and annual and

relevant documentary evidence forms to
be attached. In preparing, it should
identify various areas that have
generated funding and those absorbed
funds.
Income generated and expenditures
incurred per department/section should
be included
Advantages of maintaining three types of
accounting procedures
Advantages include:
-Identifying the departments/sections generating
money and proportional contributions those
need more attention in terms of expenditures
-Rational allocation of facility money
-Cost centre trends may assist in developing a
realistic financial plan
-Identifying problems in the
departments/sections
c. Importance of keeping financial records
• Reporting income and expenditure
accuracy and up-to-date for success of
business
• For the business to achieve its success and
profit
• Assists to prepare financial statements
accurately.
• Provides control of cash in the business.
• Provides information to financial decisions.
Importance of keeping financial records
• Contributes in assessing financial
situation of business
• Keeps good tracking of costs
• Measures the business performance
against the projections that were
originally set down in the business plan.
• Fulfils the obligations as to taxation law,
calculating how much tax have to pay.
Importance of keeping financial records
• Income generated now and how much income
expected to generate in the future.
• How much you owe for goods or rent or other
expenses.
• How much cash you have on hand and how
much cash is tied up in other things such as
stock.
• How often turnover stock.
• Identifies gross profit and your net profit.
Importance of keeping financial records
• Compares financial situation with past or
budgets.
• How much cash is owing to, and how long it
has been outstanding.
• Compare actual expenses and overheads
compared projections
• Identify products making a profit and which
are running at a loss
• Compares product or service quality with costs
to those of competitors
d. Fill in various financial records in the appropriate account books

This is practical session need preparation

with accounting section
e. Balance the account books

This is practical session need preparation with

accounting section
f. Maintaining safe custody of revenue

• Practical session need preparation with

accounting section
g. Describe financial regulations that govern utilization of funds

• Practical session need preparation with

accounting section
h. Prepare financial reports

• Practical session need preparation with

accounting section
Key points

1. There are tools used to collect and

keeping financial records
2. Financial records is a guide, control, and
business decision tool
3. There various financial records account
4. Balance the account books
6. Maintaining safe custody of revenue
7. Financial regulations govern and utilize
funds
The end

Question please
Session 3:Demonstrating billing processes
in healthcare services
Objectives
Students are expected to
a. Define billing process
b. Explain types of payers for medical insurance
c. Describe in-patient and out-patient billing
procedures
d. Organize patient billing records
a. Defining billing process

Billing process, is an interaction between a

healthcare provider who claims
with health insurance or any companies
in order to receive payment for services
rendered; such services are treatments
and investigations. The entirety of this
interaction is known as the billing
cycle sometimes referred to as Revenue
Cycle Management (claims, payment and
billing). 
b. Types of payers of medical insurance
Public Insurance
-National Health insurance Fund (NHIF)
-Community Health Fund (CHF)
Parastatal
-National Social Security Fund-Social Health Insurance
Benefit (SHIB)
Private insurance schemes
-Prosperity Africa
-AAR health services
-Momentum
-Tanzania Private Hospitals Consotorium Services
Other forms of payers for medical insurance

Coinsurance
- A form of medical cost sharing in a health
insurance. An insured person pay a stated
percentage of expenses after the deductible
amount. Once deductible amount and
coinsurance are paid, insurer is responsible for
rest of the reimbursement to covered benefits
up to allowed charges: the individual could also
be responsible for any charges in excess of what
the insurer determines to be. Rates may differ if
services are received from an approved or if
received by providers not on the approved list.
Other forms of payers for medical insurance

Copayment
- Cost sharing in health insurance that requires
an insured person to pay fixed amount when a
service is received. The insurer is responsible
for the rest of the reimbursement. There are
separate copayments for different services
Deductible
- A fixed amount during the benefit period,
usually a year - that an insured person pays
before the insurer starts to make payments for
covered medical services.
Other forms of payers for medical insurance

• Plans may have both per individual and

family deductibles. Some may have
separate deductibles for specific services.
• For example, a plan may have a
hospitalization deductible per admission.
Deductibles may differ if services are
received from an approved provider or if
received from providers not on the
approved list.
c. In-patient and out-patient billing procedures
Review Billing Information (Billing Clerk)
• Access the daily shipping log in the computer system.
flag the records as billable transactions.
• preview each prospective invoice that is to be printed.
• Verify that all prices have been approved by the order
entry staff. If not, match the listed prices against the
official corporate price list, and obtain approval for
any variances from this list.
• Add a freight charge, unless the order is flagged as
being prepaid or to be picked up by the customer.
• Verify that the code for the customer's sales tax is
correct, and adjust it if necessary.
In-patient and out-patient billing procedures
Print Invoice Batch (Billing Clerk)
• Select the option in the billing (print )all flagged invoices
• Print the entire invoice batch and verify that they printed
correctly.
Prepare and Send Invoices (Billing Clerk)
• If the invoices are in multiple copies, burst the copies and
retain the designated copies.
• Stuff the invoice version designated for customers into
envelopes.
• Stamp "Address correction requested" on the billing
envelopes.
• Deliver the billing envelopes to the mail room for mailing.
d. Organizing patient billing records

• Patients’ medical examinations or

procedure, necessitate medical staff to
work with patient and patient's insurance
company for claims.
• The biller submit and follow up claims in
order to receive payment of services
rendered. Involves learning diseases
codes (diagnoses), and medications to
process the claim properly.
 Organizing patient billing records
• Medical billing and coding workers are
health care professionals in charge process
patient data such as treatment records and
related insurance information
• Medical insurance billers and coders are
tasked with coding a patient's diagnosis
along with request of payments from
patient's insurance company. Therefore
training is need to be successful.
Key points

1. There are billing process to claim health

services payments rendered
2. There several types of payers for medical
insurance
3. To claim payments there in-patient and
out-patient billing procedures
4. Patient’s billing records should be
organized