Fiscal Concerns Case Study: Unit Budget Analysis
Thomas Edison State College
A budget is the most basic financial document needed to manage and plan for income and expenses throughout the year. The process of planning the budget is an ongoing process that requires adjustments throughout the year as needed to meet the goals of the organization it supports. When preparing a budget for an acute care unit in a hospital, there are many different reasons that the budget needs to be adjusted in order to meet the needs of the staff, patients and organization. This case study looks at the budget of a cardiac care unit with a variable budget. Several different factors ...view middle of the document...
The increased acuity must be presented to support the need for extra staff. Once patient acuity is determined, the nursing hours per patient day can be calculated to justify the additional FTE’s needed per shift (Kirby & Wiczai, 1985).
The risk manager is requesting new smart pumps that calculate and manage high risk medications. New JCAHO safety standards require them. In the current fiscal year, all of the money allocated for equipment has been spent. According to Yoder-Wise, expenses that are related to major capital items such as equipment and structure are related to the capital expenditure budget. Since these smart pumps are needed to meet JCAHO safety standards, they are going to need to be purchased for use throughout the hospital, so they should be provided under the capital expenditure budget. Capital expenses are kept separate from operating expenses because the high cost included into the operating budget would make the price of delivering care to expensive. Before approaching administration to request the new pumps, well-documented justifications are needed. Since these pumps are needed to be compliant with JCAHO safety standards, and there is a sale currently being offered for the pumps, the organization should provide them for the unit under their capital expenditure budget.
There is a rising rate of infection on the unit, and a representative has suggested new soap dispensers be placed outside each room. The dispensers will cost $2000, and come with a four-month trial. There is $2500 left in the supply budget for the month. This expense would nearly deplete that, leaving not much left for other supplies needed to care for patients. This is an expense that needs to be deferred to the next fiscal year.
Nurses are requesting a new nursing medication web subscription for the unit that will cost $100 a month. This is an expense that I would also defer the next fiscal year. There is $400 remaining in the education budget, but I feel that is money that needs to be reallocated elsewhere. The smart pumps should provide the...