Part 1: Synthesize a \”mock\” budget for a nursing unit, using Budget/PTO forms with the identified staffing model.
Part 2: Develop a 3 to 4 page scholarly paper discussing the Nurse leaders role in budget development and implementation.
• Describe Capital, Operating, and Staffing budget.
• Identify Nurse manager role in:
o Collect relevant data
o Forecasting trends
o .Planning services & planning activities
o Implementing the budget.
o Monitoring the budget .
o Taking corrective action
o Engaging staff
1.Create a budget for 2 weeks. Your case mix is: 50% Medicare, 35% private insurance, and 15% Medicaid.
Week 1–Determine the number/type of staffing needed per shift. Important unit ratio information is: RN 1:4 Patients, LPN 1: 6 Patients, CNA 1:6 Patients, HUC 0-1/ shift. During week #1 three staff are attending annual in-house training for 2-hours. Please complete the staffing budget form (doc) using this information.
Week 2, add the following elements:
One staff calls in sick for 2 days; one staff starts maternity leave; 2 new staff RNs start working this week. Explain your decisions for staffing during Week 2 when you submit budget
- Develop a scholarly paper discussing the Nurse leaders role in budget development and implementation. The following are aspects for development in your discussion:
- Describe Capital, Operating, and Staffing budget.
- Identify Nurse manager role in:
- Collect relevant data
- Forecasting trends
- .Planning services & planning activities
- Implementing the budget.
- Monitoring the budget .
- Taking corrective action
- Engaging staff
Creating a Budget
Name
Institution
Course
Instructor
Date
Creating a Budget
Staffing Budget Plan: Medical/Surgical unit Week 1
Census = 40, HPPD = 8.5
Ratios: RN 1:4 Patients, LPN 1: 6 Patients, CNA 1:6 Patients, HUC 0-1/ shift
Case mix: 50% Medicare, 35 % private insurance, 15 % Medicaid.
| Staff Mix | Charge RN | cost | RN | cost | LPN | cost | CAN | cost | Contingent staff | cost | HUC
clerical |
cost | Total hours | HPPD | ||||||||||||||||||||||||||||||
| Shift | ||||||||||||||||||||||||||||||||||||||||||||
| 7am–
3pm 36% |
1 | 9 | 12 | 12 | 1 | 1 | 112 | |||||||||||||||||||||||||||||||||||||
| 3pm–
11pm 36% |
1 | 9 | 12 | 12 | 1 | 1 | 112 | |||||||||||||||||||||||||||||||||||||
| 11p–
7am 28% |
1 | 8 | 10 | 10 | 1 | 0 | 88 | |||||||||||||||||||||||||||||||||||||
|
3 | 18 | 24 | 24 | 3 | 2 | 224 | |||||||||||||||||||||||||||||||||||||
| 7pm-
7am |
3 | 17 | 22 | 22 | 3 | 1 | 200 | 8.67 | ||||||||||||||||||||||||||||||||||||
| Total Cost/ staff | 40* 2.1 (112 hour shifts) | |||||||||||||||||||||||||||||||||||||||||||
| Details: 3 staff are attending annual in-house training for 2 hour | ||||||||||||||||||||||||||||||||||||||||||||
Staffing Budget Plan: Medical/Surgical unit Week 1
Census = 40, HPPD = 8.5
Ratios: RN 1:4 Patients, LPN 1: 6 Patients, CNA 1:6 Patients, HUC 0-1/ shift
Case mix: 50% Medicare, 35 % private insurance, 15 % Medicaid.
| Staff Mix | Charge RN | cost | RN | cost | LPN | cost | CNA | cost | Contingent staff | cost | HUC
clerical |
cost | Total hours | HPPD |
| Shift | ||||||||||||||
| 7 – 3pm 36% | 1 | 9 | 12 | 12 | 1 | 1 | 112 | |||||||
| 3 – 11p 36% | 1 | 9 | 12 | 12 | 1 | 1 | 112 | |||||||
| 11 – 7a 28% | 1 | 8 | 10 | 10 | 1 | 0 | 88 | 8.67 | ||||||
| 7-7pm | 3 | 18 | 24 | 24 | 2 | 2 | 224 | |||||||
| 7-7am | 3 | 17 | 22 | 22 | 1 | 1 | 200 | |||||||
| Total Cost/ staff | 40*2.1 (12 hour shifts) |
Creating a Budget
Creating and managing a budget for a healthcare institution can be a very challenging task. Nurse leaders play essential roles during budget development and implementation. When creating a budget, nurse leaders should ensure they first think about the strategies and goals of their departments. They can then participate in the budget planning by communicating the budget plan to their team members, monitoring adherence to the planned budget, and evaluating outcomes of the budget planning. This paper discusses the nurse leader’s role in budget development and implementation by giving a brief description of capital, operating, and staffing budget, and identifying the functions of a nurse manager in collecting relevant data, forecasting trends, planning services, and planning activities, implementing the budget, monitoring the budget, taking corrective action and engaging staff.
Capital budget
Capital budgets are a financial tool used in healthcare institutions to plan for cash-intensive, significant, and long-term projects such as building new facilities, obtaining new equipment and machines, and funding long-term research. Capital budgets are set aside for the purchase of fixed assets and equipment and their maintenance. Nursing organizations can conduct capital budgeting to determine which of the proposed equipment and fixed asset purchases should be approved and the ones which should not be approved. Capital budgeting is vital in every nursing organization because significant fixed asset investments can easily cause bankruptcy. They should hence be keenly monitored before they are approved (Accounting Tools, 2021).
Operating budget
Healthcare institutions can develop an operating budget to determine their revenues and expenses over a particular period, usually one year. An organization prepares an operating budget to project what its revenues and costs are expected to be over a specific period. It is then used to show the activities that are expected to be completed during the following year. Operating budgets are crucial for nursing institutions as they can help them adapt to changing conditions, achieve better performance, and update their strategies and actions. An operating budget comprises different components such s revenues, variable costs, fixed costs, and non-cash expenses, and non-operating expenses (Cynthia, 2019).
Staffing budget
A staffing budget refers to the budget set aside by an organization to spend on its independent contractors and employees. A staff budget can often be one of the most significant expenses for an organization, especially for service companies such as healthcare institutions. For the organization’s resources to be used efficiently, nurse managers should manage their staff budgets properly. They can do so by coming up with a list of all their staff members and their corresponding salaries in a spreadsheet to have a glimpse of their total current staffing costs, be it annually, monthly or weekly. They can develop their staff budget on the same spreadsheet after summing up their total expenses and establishing how much they spend on their staff. Staffing budgets are essential because they help nurse managers determine the amount of work conducted by every team and hire more staff members. It also helps nurse managers monitor the productivity of their current staff and make necessary decisions regarding particular staff cuts and their budgets if need be (Louise, 2017).
Roles of nurse managers in budget development and implementation.
Nurse Managers play a crucial role in the development and implementation of the budget. They ensure that all their units and departmental expenses fall within the stipulated budget. They do so by sharing their financial expectations with their unit staff so that all of them are made aware of their financial goals. Nurse Managers also ensure that all the staffing costs are as per the budgeted amounts. Nursing managers are mandated to supervise nursing staff and oversee patient care, make personnel decisions, coordinate meetings, and make budgetary and management decisions (Duquesne University, 2020). During the budget-making and implementation process, nurse managers collect relevant data, forecast trends, plan services and activities, implement and monitor the budget, engage the staff, and take corrective action.
During the data collection process, nurse managers should take an active role in obtaining monthly data on adverse events and quality outcomes. Once received, the nurse managers can review these data to determine some of the trends. Nurse Managers also use quality and safety measurement techniques to assess the quality of care received on their units. Every nurse manager should be actively involved in the collection of relevant data. Nurses Managers should also collect financial data to help them deliver cost-effective medical care in their units (Al Rundio, 2020).
Once they take part in data collection, nurse managers can use the collected data in forecasting trends. The nursing profession is constantly changing with new regulations and healthcare practices being adopted daily. Some of the latest trends include the use and implementation of technological advances, the need to understand better the population being served and much focus shifting towards quality-assurance practices. Forecasting these future trends will significantly help a nurse manager, especially when coming up with an operating and staffing budget. A nurse manager should actively participate in forecasting trends. By doing so, they will be able to determine future needs for their units and whether more staff are likely to be needed or cut in the future to come up with an appropriate budget (Al Rundio, 2020).
Nurse Managers are mandated and responsible for financial resources and managing humans within a nursing organization, ensuring the satisfaction of both staff and the patients and maintaining a safe environment for the team. The patients, ensuring quality standards of care, are held within the facility and aligning the goals of their units to the hospital’s strategic objectives. Nurse Managers take an active role in planning services and planning activities during budget development and implementation. They participate in the planning process by determining which services and activities are likely to be rendered during the next fiscal year and communicating it to the financial department for inclusion in the budget.
Nurse Managers set the design and budget goals for their respective units in collaboration with their financial departments. This budget is then submitted to the administration for approval after it has been developed and updated. The nurse manager then implements the budget plan after approval by the upper-level administration. The nurse manager participates in the implementation by providing the services stipulated in the budget (Al Rundio, 2020).
Once a budget has been developed and implemented, it has to be monitored. Monitoring of the budget is conducted through routine accurate financial reporting. Nurse Managers engage in the monitoring process by using reports to compare the actual revenues and expenses to the budgeted costs and revenues. Variance analysis is also conducted by the financial department and sent to the nurse manager for investigation.
Corrective measures need to be taken when necessary. Initial goals may need to be modified according to the performance of the current budget. Sometimes, budget constraints may require a change in the levels and types of resources and services used. The nurse manager should come up with newer budget projections and recommendations. The nurse manager can change the budget for their next operating period and add more staffing to their shifts (Al Rundio, 2020).
All staff needs to be engaged in the budget development and implementation process. Nurse Managers play an active role in ensuring all the staff, including departmental heads, directors of the budget, vice presidents, CEO, board of trustees, and finance committees, are engaged in the process. The nursing manager confirms details from all departmental heads and staff regarding their operating budget expenses and ensures that they are consistent with the organization’s objectives and goals.
In summary, this paper has discussed the nurse leader’s role in budget development and implementation by giving a brief description of capital, operating, and staffing budget, and identifying the functions of a nurse manager in collecting relevant data, forecasting trends, planning services, and planning activities, implementing the budget, monitoring the budget, taking corrective action and engaging staff. Nurse Managers play a crucial and active role during budget development and implementation.
References.
Accounting Tools. (2021). Capital budgeting definition. https://www.accountingtools.com/articles/what-is-capital-budgeting.html
Al Rundio. (2020). Budget development for nurse managers. Nursing Centered. https://nursingcentered.sigmanursing.org/features/top-stories/budget-development-for-the-nurse-manager
Cynthia, Gaffney. (2019). What Is an Operating Budget? Chron. https://smallbusiness.chron.com/operating-budget-61475.html
Duquesne University. (2020). Nurse Manager Leading the Nurse Profession into the Future. https://onlinenursing.duq.edu/blog/roles-nurse-manager-leading-nursing-profession-future/
Louise, Balle. (2017). How to Manage a Staff Budget. Biz Fluent. https://bizfluent.com/how-7925742-manage-staff-budget.html