Week 6: Assignment: Budget and Financial Indicators
Week 6: Assignment: Budget and Financial Indicators
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• Points 100
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Purpose
The purpose of this assignment is to provide you with the opportunity to analyze financial indicators to ensure high-quality and cost-effective patient care and to develop a budget for the DNP Project.
Course Outcomes
This assignment enables the student to meet the following course outcomes:
• CO 1: Examine the role of the DNP-prepared nurse in leading financial planning and management across healthcare settings. (POs 2, 4, 9)
Due Date(s)
Submit your assignment by 11:59 p.m. MT Sunday at the end of Week 6. The late assignment policy applies to this assignment.
Total points possible: 100
Page Requirement:
Length 2-3 pages – excluding title page and references.
Instructions
There are two parts to this assignment.
1. Respond to only one of the two scenarios presented. As background to this assignment, please refer to Chapter 3 in the Waxman text.
2. Create a budget for your DNP Project. Utilize the following budget template to assist you with budget development.
o Link (Word doc): Budget Template (Links to an external site.)
Part 1: Select one of the following scenarios to discuss.
Scenario Option: RN Overtime Hours and Costs
As discussed in Scenario Three in Chapter 3 (The True Cost of a Productive Nursing Hour) in the Waxman text, the chief nursing officer (CNO) of Pacific Hospital realizes that overtime hours and associated costs are excessive. The budget target is to reduce weekly overtime hours per full-time RN from 6.5 to 4.0 hours.
a. Present evidence-based approaches (cited) to propose strategies to reduce overtime at Pacific Hospital. Strategies may include substitutes for overtime, interventions such as rapid response teams to quickly address patient complications, or other ideas.
b. Prepare a table using data that you make up (fictitious) showing your analysis of reduction in overtime hours and related cost savings over a six-month period.
Table: RN Productive and Overtime Budget Analysis for Medical-Surgical Units
Item Budget Actual Variance
Available beds 80
Occupancy rate 80%
Patient days 23,296
HPPD 8
RN productive hours 186,368.0
RN productive FTE 93.2
RN overtime hours 372.7
RN productive hour expense $13,968,282
RN overtime expense $41,906.71
c. Analyze the variance of the RN overtime expense. Did the strategies you implemented result in a positive or negative variance? Examine the impact of the strategies you implemented.
Scenario Option: Ambulatory Care Budget
Scenario Four in Chapter 3 (Outpatient Care Indicators) in the Waxman text presents an example of planning an outpatient nurse-led heart failure clinic.
a. Develop a budget using data that you make up (fictitious) that includes performance and financial indicators and benchmarks for another type of outpatient service that might be provided at Pacific Hospital such as a Wound Care Clinic or Foot Care Clinic, etc. Adapt and expand on the indicators and benchmarks presented in Table 3.6. The proposed budget focuses on volume and productivity measures, staffing and non-personnel expenses, and anticipated revenue. Indicators are defined in Chapter 3 of the Waxman text.
o Link (Word doc): Example Proposed Heart Failure Clinic Budget (Links to an external site.)
Table: [Identify Clinic Type] Clinic Outpatient Benchmarks
Indicator Benchmark
Annual Statistics:
Capacity (available appointments)
Patients (new and established)
Encounters
Urgent care referrals
Specialty appointments
Current visit rate
Readmission rate (30-day)
Daily Statistics:
Average appointments per day
Average NP encounters per day
Wait Times:
Average wait time for clinic appointment (days)
Average office visit cycle time (hours)
Financials:
Average revenue per encounter
Average expense per encounter
Net profit or loss
Item 2020 Budget
Annual Statistics:
Capacity (available appointments)
Patients (new and established)
Encounters
Urgent care referrals
Specialty appointments per encounter
Current visit rate (average encounters per patient per year)
Readmission rate per patient
Daily Statistics:
Average appointments per day
Average wound care nurse encounters per day
Wait Times:
Average wait time for clinic appointment (days)
Average office visit cycle time (hours)
Financials:
Total revenue
Average revenue per encounter
Total personnel expenses
Total nonpersonnel expenses
Total expenses
Average expense per encounter
Net profit or loss
b. Briefly discuss at least three factors related to the proposed new clinic that may impact a cost-savings for Pacific Hospital (e.g. fewer emergency department visits, reduction in 30-day readmission rates, decreased hospital LOS, improved cost structure for equivalent procedures, patient/surgeon preference, etc.).
c. Briefly discuss at least four factors that may impact the financial performance of the proposed clinic (e.g. staffing, electronic health record/technology, physical space overhead/maintenance, DME/medical supplies, payor mix – reimbursement rates, improved access to care for patients, improved patient convenience/experience, upfront investment/purchase costs, case volume threshold for financial sustainability, increased market share, patient/surgeon preference, regulatory requirements, etc.).
Part 2: Create a budget for your DNP Project
Develop a detailed budget of your DNP project that includes all of the costs of the project. Use the format provided to plan your budget. Make your budget as comprehensive as possible. Include the costs of your time and the participants’ time as part of your budget development. Be sure that all expenses are covered by a revenue source and that you provide a balanced budget
• Link (Word doc): Budget Template (Links to an external site.)
Grading Rubric
Criteria are met when the student’s application of knowledge within the presentation demonstrates achievement of the outcomes for this assignment.
Rubric
Week 6 Assignment Grading Rubric: Budget and Financial Indicators (100 pts)
Week 6 Assignment Grading Rubric: Budget and Financial Indicators (100 pts)
Criteria Ratings Pts
This criterion is linked to a Learning OutcomeContent
Requirements:
RN Overtime Hours and Costs Scenario
1. Present evidence-based approaches (cited) to propose strategies to reduce overtime.
2. Prepare a table showing your analysis of reduction in overtime hours and related cost savings.
3. Analyze the variance of the RN overtime expense.
OR
Ambulatory Care Budget Scenario
1. Develop a budget that includes performance and financial indicators and benchmarks.
2. Discuss factors related to the proposed new clinic that may impact a cost-savings for the hospital.
3. Discuss factors that may impact the financial performance of the proposed clinic. 50 pts
Includes all requirements with an excellent discussion and presentation. 45 pts
Includes all requirements with a very good discussion and presentation. 40 pts
Includes all requirements with a basic discussion and presentation . 0 pts
Includes two or fewer requirements or is poorly presented.
50 pts
This criterion is linked to a Learning OutcomeDNP Project Budget
Requirements:
1. All expenses recorded.
2. All Revenue sources appropriately attributed to expenses.
3. Revenue is equal to or greater than total expenses. 50 pts
Includes all requirements and is comprehensive. 45 pts
Includes all requirements and is adequate. 40 pts
Includes no less than 2 requirements. 0 pts
Includes 1 or fewer requirements for this section presented.
50 pts
Total Points: 100
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