Business Continuity Section 10 - Site Closure Policy Tier 2 and 3 Financial Recovery Tier

Business Continuity Section 10 - Site Closure Policy Tier 2 and 3 Financial Recovery Tier

NYC DOHMH 2012 PCEPN Contract Delv. 3C

HealthCenter Logo
Pol. No.
4.9 / Section
Business Continuity / Policy
Financial Loss and Recovery
Preparedness, Response, and Recovery / Approval / Tier
Tier 1 and 2
Effective Date / Revised Date / Attachment

4.9.1 Purpose:

The purpose of this policy and procedure is to outline the organization’s policy on the use of financial instruments to support recovery after a disaster has occurred. This policy will outline the financial resources kept by the health center to assist the health center in recovering financial losses. Since certain financial records that may be identified within may contain sensitive information about the financial resources of the health center, it is recommended that this document be deemed confidential and added to the emergency management plan with the sensitive information blacked out.


It is the policy of the health center to engage in preparedness and recovery activities to assist the health center in recovering from losses due to an emergency. The ability to recover from disaster is often linked to the strength and stability of finance. To this end, this health center will maintain appropriate financial records in order to assist in the recovery efforts. Maintaining accurate financial records will assist the health center in recovering losses from a variety of programs including insurance policies, federal or state recovery mandates, and bank loans and disbursements. The Chief Financial Officer is hereby responsible for maintaining this data and assisting the emergency management committee in maintaining an accurate accounting of losses as well as assisting recovery officers with the burden of establishing financial instruments for the recovery process. The following questions should be answered with regards to the financial recovery planning:

4.9.3 Procedure Guidance:

  1. Planning:

During the planning phase, the organization should identify which financial instruments are available to help bridge the organizations operations to normalcy.

  1. Business continuity insurance is available to health centers through banks and insurance groups such as Nationwide and Allianz, and such policies increase cash-flow to disaster-struck businesses. Be aware of your deductible and how you will pay it should a disaster arise.[1]
  2. A CHC may also obtain a pre-approved loan from a bank, so that in the event of a disaster, the money can be distributed immediately and the health clinic can begin reconstructing damaged buildings and purchasing necessary supplies and services.
  3. The organization should identify a cash source and a minimum to keep on hand in the event of an emergency. Petty cash can be used to fund operations, supply, food and water provisions, and even pay for insurance deductibles.
  4. Maintain current accounts receivable reports, payable reports, and any financial report that may assist the health center identify funding that may be due in the short term. (up to 3 months)
  5. Separately maintain the records of patients seen during the disaster. At times, there may be separate funding available for these activities. Most disaster funding sources require meticulous records to release disaster relief grants.
  6. Assure that the delegation of authority has been clearly outlined and include all those that will have the authority to spend during a disaster as well as who will have the authority to handle the finances if normal operations are affected.
  1. Mitigation
  1. Maintain an adequate amount of cash on hand to pay for at least 3 days of payroll, food, water, fuel, medical supplies, and insurance deductibles if needed.
  2. Run regular financial reports (monthly is adequate) on how much has been billed, how much is due to the health center (an estimate), and what its financial obligations are if a disaster affects the operations of the health center longer than three days.
  3. For those health centers that are paperless, ensure that the health center has a number of blank paper records to receive patients during a disaster.
  1. Response
  1. Identify the procedures needed to access petty cash accounts.
  2. Identify the procedures needed to file a claim with insurers on behalf of the health center.
  3. Identify the procedures needed to hand write a claim for a medical payer for patients if needed.
  4. Identify record keeping needs.
  5. Identify procedures to perform a quality review of the financial operations as soon as possible after a disaster has occurred.
  1. Recovery Strategies

In this section, please list all the possible instruments, their availability, and their access for the recovery of the health center after a disaster. Please note that after certain disasters, federal state, or local grants may become available for recovery from action taken during the incident or to recover from damage caused by the incident. In order to participate in these governmental programs, accurate accountings of losses must be documented. Please list below all potential recovery strategies available to the health center, including institutions, contacts, and responsible party.

Recovery Strategies

Financial Instrument / Institution / Contact / Contact Number / Responsible Party / Records Needs / Identifying Information (Account Numbers etc.)

PCEPN EMP Section 4, Plan 9, Business Continuity

[1] PCEPN is not endorsing any particular business and provides the names of these insurers as examples. PCEPN does not endorse as a matter of business practice any specific business entity or product.