What is Healthcare Administration?

Healthcare administration is the business side of healthcare. Doctors, nurses, and allied health professionals are all on the front lines providing high-quality care to patients. However, at the end of the day, the clinics and hospitals where these professionals work are businesses and must be managed as such.

There are professionals at all levels of healthcare administration, from facility management all the way up to the CEO of the hospital. These professionals are responsible for maintaining a smooth-running operation that is centered on quality patient outcomes. Some of these roles involve supervising staff, while others may entail establishing policy or even compliance. Those working in healthcare administration rarely have contact with patients, although they do typically work in teams with other healthcare professionals or administrators.

While it may seem second nature to have administrators in healthcare settings, this has not always been the case. The first hospital superintendents appeared in the early 1800s, with the first formal association, the Association of Medical Superintendents of American Institutions for the Insane, being established in 1844.

In 1899, eight hospital superintendents founded the Association of Hospital Superintendents, which later became the Association of Hospital Administrators (AHA). Even from the early days, costs were at the forefront of administrators concerned with the rising costs of healthcare. In 1904, the AHA established its first formal committee to develop a uniform hospital accounting system.

Over the years, the focus of the AHA (and healthcare administration as a whole) has shifted. In the 1930s, education and research were prioritized; by the 1940s, they started looking at better patient care; and in the 1950s, it moved to improving public welfare through improved hospital care. Lobbying became a priority for the AHA in the 1970s and has remained a cornerstone of their organization. Overall, healthcare administration has transformed to create a system that is standardized, consistent, and provides quality medical care.

Healthcare administration is a vast field. Below is an overview of this line of work, including work environments, typical job titles, day-to-day duties, and job outlook.

Job Titles in Healthcare Administration

Within healthcare administration, there are numerous roles. Titles for professionals in this field vary based on place of employment, education level, and job duties performed. Typical titles in this career include:

  • Nursing home administrator
  • Hospital CEO
  • Clinical manager
  • Lab facility manager
  • Human resources manager
  • Health information manager
  • Hospital Administrator
  • Director of patient care services
  • Director of nursing

Jobs in healthcare administration are divided into two categories. They are either generalist or specialist positions. Generalists can be tasked with overall facility or organizational management, such as that of a facility manager or a hospital CEO. Specialized healthcare administrators work within a department or designated field, such as human resource managers or a chief financial officer.

Work Environment of Health Administrators

Most professionals in healthcare administration work in offices and rarely interact directly with patients. However, those in healthcare administration tend to be a part of a larger team and interact with other professionals on a daily basis. They also frequently work with clinicians, physicians, nurses, lab staff, and other health professionals who do work directly with patients.

Hours for healthcare administrators are most often standard office hours of nine to five Monday through Friday. However, administrators may have to work weekends or odd hours if they work in a 24-hour facility like a hospital or nursing home. It is also common for healthcare administrators to be on-call in case of emergencies. Hospital administrators primarily work full-time, and overtime hours are not uncommon.

The most common place for healthcare administrators to work is in hospitals. The Bureau of Labor Statistics (BLS 2020) estimates that a third of medical and health service managers work in hospitals. The rest work in physician’s offices, nursing or residential facilities, outpatient care centers, and government agencies.

Education Requirements of Health Administrators

It is possible to become a healthcare administrator with only a bachelor’s degree, although a master’s degree is the most common degree obtained and preferred by many employers. For those pursuing an undergraduate degree, the most common majors are healthcare administration, social work, public health, or business administration.

Master’s degrees in healthcare administration (MHA) are offered all across the country in online, hybrid, and on-campus formats. These degrees take between two to three years to complete and often include hands-on internships that provide students valuable experience directly in this field.

Other master’s degrees that may provide the necessary education to enter this field include public health, social work, nursing, health information management. Students who want to pursue this career should take business administration courses, medical terminology, health information systems, ethics, accounting, and hospital organization.

Education alone is often not enough to enter this field directly. Recent graduates may find it necessary to have a year or two of relevant work experience in order to advance into a healthcare administration career. Typical entry-level work can include nursing, administrative assistance, health information technology, or finance.

Typical Job Duties of Health Administrators

The primary role of healthcare administrators is to plan, direct, and manage medical services. This can be done in a myriad of ways, from large-scale planning to managing a facility to coordinating human resources. While healthcare administrators’ day-to-day duties vary based on their place of employment and job title, there are universal tasks. These include:

  • Finding ways to improve the efficiency of medical care delivery
  • Setting goals for a given department
  • Maintaining compliance with federal, state, and local regulations
  • Recruiting and training staff
  • Setting work schedules
  • Writing budgets for a department
  • Ensuring a department stays within budget
  • Communicating with medical staff and senior staff to keep them up to date
  • Maintaining careful records

Career Outlook of Health Administrators

Currently, healthcare administration is a field with outstanding job prospects. The Bureau of Labor Statistics classifies professionals in healthcare administration as medical and health services managers and anticipates a 32 percent increase in positions in this field nationally between 2019 and 2029. Overall, this translates into 133,200 new jobs. This impressive growth is eight times the national average for all professions in the same period.

There are several reasons for this substantial growth, but the primary one is an aging Baby Boomer population. As this population continues to age but wants to stay healthy and active, they will continue to increase the demand for high-quality medical care.

Another reason for the increased demand for healthcare administrators is the change in how healthcare is delivered. In the past, most medical procedures were provided at hospitals as they had the resources, facilities, and staff. Now, more and more clinics and outpatient centers have the necessary equipment and staff to provide the procedures themselves, often at a lower cost. However, there must be additional administrative staff to help manage the equipment, budgeting, staff, and resources these additional procedures require.

Working in healthcare administration can be quite lucrative. The BLS (May 2020) estimates that the average wages for professionals in this field are $118,800 per year. The top 90 percent of earners make $195,630 per year or more, while the bottom 10 percent earn $59,980 or less. Wages are primarily based on place of employment and education level. Those with master’s degrees or higher earn the most, as well as those who work in urban areas such as Santa Cruz, CA, and New York, NY.

Useful Professional Associations in Healthcare Administration

  • American Hospital Association (AHA)
  • Professional Association of Health Care Office Management (PAHCOM)
  • American College of Health Care Administrators (ACHCA)
  • Commission on Accreditation Healthcare Management Education (CAHME)
  • Association of University Programs in Health Administration (AUPHA)
Kimmy Gustafson

Kimmy Gustafson

Writer

Kimmy is a freelance writer with extensive experience writing about healthcare careers and education. She has worked in public health, at health-focused nonprofits, and as a Spanish interpreter for doctor’s offices and hospitals. She has a passion for learning and that drives her to stay up to date on the latest trends in healthcare. When not writing or researching, she can be found pursuing her passions of nutrition and an active outdoors lifestyle.

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