The nursing operations budget serves as a blueprint for the department’s income and spending forecasting and planning. It is usually for a period of one calendar year. Preparation and control of the operational budget are two of the most time-consuming aspects of most nurse administrators’ engagement with financial management, and they take up a significant portion of their time. Sound financial management is critical to healthcare economic security. Making the proper financial choices ensures the target community has access to services. The need for effective financial decisions and financial planning is becoming increasingly clear to hospitals (Scott et al., 2018). Making good financial decisions is frequently expressed in unit or facility budgets. A facility’s operation requires an operational budget. So, once nursing units adopt effective operating budgets to help implement unit activities targeted towards improving patient outcomes and promoting an effective environment for nurses, the budget should be evaluated for success. Nurse leaders must create a budget for their unit that includes financial planning and cost control. Preparing an operating budget requires the capacity to assure optimal performance by enabling and gratifying nurses while maintaining best practices for the unit. In this article, I hope to give an overview of the Care Hospital, its relevant history, and the current budget year’s status and timeline.
Nursing Goals, Objectives, Policies and Assumptions
Nurse leaders need a budget plan to optimize resource usage and allocation because they are on the front lines of patient care. An operating budget helps to fulfill the daily operational costs for facility delivery of quality and safe care practices on a daily basis. Nurse leaders must make data-driven decisions in order to fulfill their obligations in improving care quality and safety (Hunt, 2017). Financial analysis is concerned with the organization and presentation of data in a meaningful format in order to facilitate comparison, analysis, and synthesis. Meeting competing patient needs while maintaining the firm’s financial resource capability is one of the most difficult issues nurses faces. This is accomplished by creating an effective operational budget to fulfill competing healthcare needs.
Nursing Program Priorities
When establishing an operating budget for cost control, various aspects and assumptions must be considered. Past patterns in the purchasing pricing of goods and suppliers may have been taken into account, as well as altering tax laws and government regulations affecting the industry. The cost of services provided, and the facility’s economic performance must be assessed in the budget. The operating budget is vital to improve the quality and safety of care based on the identification of these critical criteria (Moons et al., 2019). In a nursing unit with a capacity of 35 beds, there are a variety of budget considerations. To begin, the budgeting process must first establish the units on a monthly basis. Review and track the unit’s monthly spending by calculating the budget on a regular basis to ensure that the unit’s financial budget is met. Where appropriate, nurse leaders must adjust.
Nurse managers must ensure that nursing unit expenses are accurately reviewed to avoid negative effects on staff performance or resource waste. Several nurses recently left the unit, and the nurse manager is committed to filling the vacancies. Due to the unit’s focus on elderly patients with additional healthcare demands, the staff work plan includes airtime to satisfy patient needs. The facility has experienced costs related to this patient group, raising concerns about cost control. An operating budget is required for the upcoming fiscal year. The fiscal year is April 1 – March 31. Nurse leaders must compare actual expenditures against budget allocations. Justifications for operating budget deviations must be presented to ensure that the unit does not overspend or underspend. The budget justifications need taking steps and interventions to mitigate any negative variations. Changes in volume, personal expenses, medical supplies, differential or premium paid for night shift nurses, and holidays must be accounted for in the budget. Other concerns include the nursing unit’s benefits and travel expenses.
Nurse leaders frequently struggle to balance opposing demands for quality, safety, and sustainability. To improve financial accountability and cost control actions, the nurse unit must combine patient quality and safety objectives with facility healthcare cost management (Spacey, 2017). In managing an acute care nursing unit, nurses must consider patient staffing ratios, financial reporting, and financial budgets (Hill et al., 2015). Following budget approval, the nurse manager will develop strategic strategies for budget implementation. Fiscal planning is required to integrate an operating budget with the facility management’s strategic plan. This helps connect spending with expected financial growth in strategic strategies and commitments (Spacey, 2017). Cost planning is a critical strategic choice that must be linked with budget aims.
Strategic budgets are frequently used as a management planning tool to help solve challenges and incorporate competitive advantage tactics. To improve patient care while keeping costs low, nurse leaders must develop unit goals that match with the organization’s strategic aims (Hill et al., 2015). To improve the quality of services provided and create essential capabilities to remain competitive, evaluation criteria that reflect patient satisfaction, cost reduction targets, increased revenue, budget management leader, and peer and colleague influence should be considered (Hill et al., 2015). Nurse leaders can help meet the staffing unit and save money. To be financially efficient, a nursing unit must adhere to best practices and cost-effectiveness. The strategy, according to Hill et al. (2015), helps nurses integrate strategic decisions with operating budgets by enhancing unit efficiency, lowering staff turnover, and organizing staffing huddles. To be competitive in the market, nursing units might connect their operating budget with their strategic goals.
Ongoing Budget Management
Budget management requires benchmarking centered on improving service delivery in the unit by implementing best practices for the unit. Identifying experience and knowledge to exchange best practices. Hill et al. (2015) claim that comprehensive healthcare priority evaluation can help ensure that limited resources can support operational commitment for the unit. However, this must be done in accordance with the nursing code of ethics and quality and safety requirements. So that actual performance can be compared to the original operating budget, nurse leaders must be able to closely monitor revenues and spending (Mitton et al., 2014). When resources are tight, most healthcare units rely on cost-cutting measures to keep expenditure under control. These cost-cutting methods must not compromise care quality or safety. To effectively manage resources, the fiscal climate must match the unit’s financial competence. During times of surplus, it is necessary to set up an emergency fund (Mitton et al., 2014). Financial limitations do not impact quality or safety outcomes. Every firm needs cost-effective options to meet its financial goals.
Making financial management decisions ensures that a nursing unit’s activities are not hampered. These financial obligations are captured in the operational budget and aligned with quality and safety outcomes. Budgeting is an ongoing training for nurse leaders that requires responsibility and cost control commitments. The performance of an operating budget is constantly compared against the unit’s financial goals. Adjustments must be made to the implementation process to match with financial goals, which may require redesigning future budget plans.
Hill, Higdon, K. S., Porter, K., Rutland, B. W., & Vela, D. K. (2015). Preserving staffing resources as a system: Nurses leading operations and efficiency initiatives – ProQuest. Www.proquest.com.
Hunt, E. (2017). Improving nursing leadership’s usage of real time, data-driven dashboards. Thescholarship.ecu.edu.
Mitton, C., Dionne, F., & Donaldson, C. (2014). Managing healthcare budgets in times of austerity: The role of program budgeting and marginal analysis. Applied Health Economics and Health Policy, 12(2), 95–102.
Moons, K., Waeyenbergh, G., & Pintelon, L. (2019). Measuring the logistics performance of internal hospital supply chains – A literature study. Omega, 82, 205–217.
Scott, P. A., Harvey, C., Felzmann, H., Suhonen, R., Habermann, M., Halvorsen, K., Christiansen, K., Toffoli, L., & Papastavrou, E. (2018). Resource allocation and rationing in nursing care: A discussion paper. Nursing Ethics, 26(5), 1528–1539.