Cash is king.

Abstract

Cash is so important that a hospital or other business can operate at a loss as long as it does not run out of cash. A business must close even if it is operating at a profit if it has no cash. Bills are paid against cash and not net income. The most important source of cash in a hospital is accounts receivable. If the chief financial officer manages receivables well, everything else seems to be manageable. Cash is often misunderstood and confused with profits. Cash is critical everyday, while profits are never critical.