1
BUDGET PROPOSAL
BUDGET PROPOSAL
EXAMPLE
This budget proposal is based on the 20 bed Infirmary (acute care nursing unit) at Sing Sing Correctional Facility.
Develop an operating expense budget for that nursing unit.
STEPS IN THE OPERATING BUDGET PROCESS
Identify the unit of service that will be the key workload measure for the budget
Number of patients=20
Calculate workload using the acuity system
Determine the total nursing care requirements for the year and the number of hours of care needed per patient day
Required Patient Care Hours
Patient Classification
Number of Pt. days
X
Average care Hrs. per 24-Hr. period
=
Total Unit Workload
1
1,900
3.0
5,700
2
2,600
5.5
14,300
3
1,400
9.0
12,600
4
800
12.0
9,600
5
300
15.0
4,500
Total
7,000
33,700
Determine staff requirements
Calculate the average # of productive hrs. per FTE
Productive Hrs.: 33,700
Paid Hrs.: 42,125
(33,700/42,125) x 100%= 80%
Determine the # of FTE’s needed
2,080 pd. Hrs. x 80%= 1,664 productive hrs. per FTE
33,700/1,664= 20.25 FTE’s
Assign staff by type and shift
Staff Type
Staff Allocation
10p-6a
6a-2p
2p-10p
Total
100%
15%
50%
35%
RN
60%
1.03
3.45
2.42
6.9
LPN
40%
.70
2.3
1.6
4.6
TOTAL
1.73
5.75
4.02
11.5
33,700/365 days= 92 hrs. care per day
92/8=11.5 shifts
Convert staff and FTE’s to positions
Determine positions and how many days per year must be covered
STAFF BY TYPE AND SHIFT
STAFF TYPE
10P-6A
6A-2P
2P-10P
TOTAL
FIXED STAFF
NURSE ADMINISTRATOR
0
1.0
0
1.0
MEDICAL RECORDS CLERK
0
1.0
0
1.0
SUBTOTAL
0
2.0
0
2.0
VARIABLE STAFF
RN
1
4
2
7
LPN
1
2
2
5
SUBTOTAL
2
6
4
12
TOTAL
2
8
4
14
FTE’s 20.25/11.5=1.76 FTE’s per shift
FULL TIME EQUIVALENTS BY TYPE AND SHIFT
STAFF TYPE
10P-6A
6A-2P
2P-10P
TOTAL
FIXED STAFF
NURSE ADMINISTRATOR
0
1.0
0
1.0
MEDICAL RECORDS CLERK
0
1.0
0
1.0
SUBTOTAL
0
2.0
0
2.0
VARIABLE STAFF
RN
1.76
7.04
3.52
12.32
LPN
1.76
3.52
3.52
8.8
SUBTOTAL
3.52
10.56
7.04
21.12
TOTAL
3.52
12.56
7.04
23.12
Determine straight time and overtime needs
FULL TIME EQUIVALENTS DIVIDED BY STRAIGHT TIME AND OVERTIME
10P-6A
6A-2P
2P-10P
TOTAL
STAFF TYPE
ST
OT
TOTAL
ST
OT
TOTAL
ST
OT
TOTAL
ST
OT
TOTAL
FIXED STAFF
NURSE ADM.
0
0
1.0
1.0
0
0
1.0
1.0
M.R. CLERK
0
0
1.0
1.0
0
0
1.0
1.0
SUBTOTAL
0
0
2.0
2.0
0
0
2.0
2.0
VARIABLE STAFF
RN
1.5
.26
1.76
7
.04
7.04
3.5
.02
3.52
12
.32
12.32
LPN
1.5
.26
1.76
3.5
.02
3.52
3.5
.02
3.52
8.5
.03
8.8
SUBTOTAL
3.0
.52
3.52
10.5
.06
10.56
7.0
.02
7.02
20.5
.35
20.85
TOTAL
3.0
.52
3.52
12.5
.06
12.56
7.0
.02
7.02
22.5
.35
22.85
Determine # of positions and the full time and PT employees needed to fill them
POSITIONS AND HOURS BUDGET
Position Title
Shift
# of positions
ST FTE’s
ST Hrs.
OT FTE’s
OT hrs.
Total FTE’s
Total Hours
Fixed Staff:
Nurse Admin.
7a-3p
1
1.0
2,080
0 0
1.0
2,080
M.R. Clerk
7a-3p
1
1.0
2,080
0
0
1.0
2,080
SUBTOTAL
2
2.0
4,160
0
0
2.0
4,160
Variable Staff:
RN FT
10P-6A
1
1.0
2,080
.26
541
1.26
2,621
RN PT
10P-6A
1
.5
1,040
0
0
.5
1,040
RN FT
6A-2P
6
6.0
12,480
.04
83
6.04
12,563
RN PT
6A-2P
2
1.0
2,080
0
0
1.0
2,080
RN FT
2P-10P
2
2.0
4,160
.02
42
2.02
4,202
RN PT
2P-10P
2
1.5
3,120
0
0
1.5
3,120
LPN FT
10P-6A
1
1.0
2,080
.26
541
1.26
2,621
LPN PT
10P-6A
1
.5
1,040
0
0
.5
1,040
LPN FT
6A-2P
3
2.0
4,160
.02
42
2.02
4,202
LPN PT
6A-2P
2
1.5
3,120
0
0
1.5
3,120
LPN FT
2P-10P
2
2.0
4,160
.02
42
2.02
4,202
LPN PT
2P-10P
2
1.5
3,120
0
0
1.5
3,120
SUBTOTAL
25
20.5
42,640
.62
1,291
21.12
43,931
TOTAL
27
22.5
46,800
.62
1,291
23.12
48,091
Calculate labor costs, including shift differentials and OT
PERSONNEL COST BUDGET
COLUMN
A
B
C
D
E
F
G
H I
Position Title
Shift
ST hours
Average Rate
Shift
Premium
Total ST Rate (B+C)
Total ST $
(A x D)
OT
Hours
OT Rate
(Dx1.5)
Total
OT$
(F x G)
Total$
(E+H)
Fixed Staff
Nurse Adm.
7a-3p
2,080
$40.00
$0.00
$40.00
$83,200
0
N/A
$0.00
$83,200
M.R. Clerk
7a-3p
2,080
15.00
0.00
$15.00
31,200
0
N/A
0.00
31,200
Subtotal
4,160
$114,400
0
0.00
$114,400
Variable staff
RN FT
10p-6a
2,080
$33.00
$3.00
$36.00
$74,880
541
$54.00
$29,214
$104,094
RN PT
10p-6a
1,040
34.00
3.00
37.00
38,480
0
55.50
0
38,480
RN FT
6a-2p
12,480
33.00
0.00
33.00
411,840
83
49.50
4,108.50
415,948.50
RN PT
6a-2p
2,080
34.00
0.00
34.00
70,720
0
51.00
0
70,720
RN FT
2p-10p
4,160
33.00
2.00
35.00
145,600
42
52.50
2,205
147,805
RN PT
2p-10p
3,120
34.00
2.00
36.00
112,320
0
54.00
0
112,320
LPN FT
10p-6a
2,080
18.00
3.00
21.00
43,680
541
31.50
17,041.50
60,721.50
LPN PT
10p-6a
1,040
19.00
3.00
22.00
22,880
0
33.00
0
22,880
LPN FT
6a-2p
4,160
18.00
0.00
18.00
74,880
42
27.00
1,134
76,014
LPN PT
6a-2p
3,120
19.00
0.00
19.00
59,280
0
28.50
0
59,280
LPN FT
2p-10p
4,160
18.00
2.00
20.00
83,200
42
30.00
1,260
84,460
LPN PT
2p-10p
3,120
19.00
2.00
21.00
65,520
0
31.50
0
65,520
Subtotal
42,640
$1,203,280
1,291
$54,963
$1,258,243
Total
46,800
$1,317,680
1,291
$54,963
$1,372,643
Submit a detailed personnel cost and supply budget for 2021 in an Excel spreadsheet format.
See attached EXCEL spreadsheet
Provide the supporting documentation for the numbers derived in the budget
See above
Write an overview regarding the types of patients seen on the unit, top 5 DRGS (or HHRG’s if Home Care), severity of patient illness, average length of stay, per cent unit occupancy and model of care delivery.
Diagnosis Related Groups (DRG’s) is a system that categorizes patients into specific groups based on their medical conditions and other characteristics, such as age, and type of surgery. Payment is fixed and not dependent on treatment. They type of patients seen in Sing Sing infirmary have acute medical diagnosis such as recovery from viral illnesses, s/p recovery from assaults, asthma exacerbations, diabetic monitoring, s/p surgery, s/p chemotherapy, or they could be waiting for placement in a facility that better suites their needs. The average length of stay varies from 3 days to a few months, depending on treatment needs. If long term therapy is needed, we would look to transfer to another facility. The unit census varies on seasons, mood of the facility (h/o gang violence), and the age of transfers into the facility (older patients typically have more comorbidities). The Infirmary is based on med-surg experience. LPN’s deliver medication and assist RN’s. RN’s assess patient’s, transcribe MD orders, admit and discharge patient’s and are responsible for charting.
Provide the financial justification for the cost of the delivery of nursing care.
Nursing care is the foundation on which the service is based on. Licensed personnel, medical supplies and supporting staff are essential to provide the service.
What is the budgeted unit census, HPPD, skill mix, RN to patient ratio in the budget you developed?
See staff by type and shift
The budget is based on 20 patients, the unit would have to be staffed whether there was one patient or 20. Acuity varies according to patient care needed, and LPN and RN skills are defined by their license.
How do you assure that the budget is flexible enough to meet the nursing care delivery needs of the patients?
Managers must understand how staff uses their time, and look for unaccounted factors in the existing budget. This will help forecast and plan future budgets.
References
Finkler, S., Jones, C., & Kovner, C. (2013). Financial management for nurse managers and executives. Elsevier Saunders, St. Louis, MO.