NURS FPX 6216 Assessment 2 Preparing and Managing An Operating Budget

Assessment 2: Preparing and Managing an Operating Budget
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Student Name
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Capella University
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Course Name
Prof Name
PX April 10, 2024
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Preparing and Supervising the Operating Budget
In healthcare management, the evolving landscape demands strategic planning,

organization, and evaluation to enhance clinical outcomes. Nursing leaders play a vital
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role in managing the operating budget, aiming to boost staff and patient satisfaction
while fostering innovation and empowerment (Brennan & Wendt, 2021). Their
effectiveness in planning, integrating current trends, and formulating efficient budgets
depends on business acumen, available resources, and understanding of healthcare
management.
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Studies show that nursing leaders with business skills enhance their capabilities,
facilitating the growth of healthcare facilities, informed decision-making, and
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patient-centered care (Alsadaan et al., 2023). This knowledge empowers nursing

leaders to introduce innovative changes, addressing both patient and staff needs while
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ensuring overall satisfaction.
Similarly, effective nursing management is linked to improved patient outcomes by

reducing medical errors, thereby boosting morale and productivity throughout the
organization (Specchia et al., 2021). Strong leadership reinforces the integration of
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high-quality, efficient, and safe patient care. This assessment focuses on preparing and
managing an operating budget for a nursing manager overseeing a 35-bed hospital with
20 full-time equivalent employees.
The aim of this assessment is to develop and manage a budget for the unit, utilizing
existing staff while addressing challenges related to turnover and retention. The budget
aims to align with organizational needs. Despite the team's willingness to provide
additional shifts and train new hires, overtime compensation is accounted for. The
current budget considers turnover, additional time, training, and new hiring expenses
while ensuring a focus on meeting the care needs of the elderly population.
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Operating Budget
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An operating budget provides a comprehensive projection of an organization's
expenses and revenue over a specified period, outlining anticipated costs and guiding
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financial operations. It covers both fixed and variable costs, typically planned for a year,
incorporating expected expenses and predicted revenue throughout the period
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(Abdulsalam & Schneller, 2019). For a small hospital, essential expenses include
medical supplies, utilities, bills, training and development, performance appraisals,
bonuses, devices, and technology maintenance. These elements are crucial for staff
satisfaction and retention, while revenue sources include patient care, research grants,
and charitable funding.
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The budget for the facility aims to improve staff retention, satisfaction, and
patient-centered care. A one-year budget, divided into three quarters, allows for
analysis and evaluation to ensure alignment with organizational goals and enhanced
patient care and staff retention. Emphasis is placed on two key aspects: staff retention
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and patient-centered care, seeking to achieve these goals through performance

reviews, bonuses, telehealth integration, and team-building training. The budget
considers the impact of staff retention and patient satisfaction on clinical outcomes,
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thereby benefiting both staff and patients (Specchia et al., 2021).

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To develop an effective budget, baseline data is essential to understand the

organization's current status. Utilizing SWOT analysis aids in identifying strengths,
weaknesses, opportunities, and threats, contributing to better financial decision-making.
Expenses encompass staff salaries, new hires, compensation, appraisals, medical
supplies, medication, research and training, technology maintenance, and hygiene
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management. Revenue sources include patient care, research grants, charitable funds,
medical aids, and staff retention. Unforeseen events during budget execution may lead
to expense increases, necessitating resource reallocation.
Budget Creation and Design
The budget creation process involves systematic planning, analysis, and

decision-making, ensuring consistency, transparency, and reliance on accurate financial
data. Strategic planning and budgeting define budget objectives by considering
economic conditions, available resources, and patient expectations (Nilsen et al., 2020).
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The budget design involves gathering data from baseline assessments and need-based
analyses, which are then subjected to SWOT analysis. This aids in identifying trends,
strengths, weaknesses, threats, and opportunities, informing budget decisions, and
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aligning with organizational goals.
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The budgeting process includes allocating resources to different areas such as
services, maintenance, and labor. The plan is documented to highlight each retention
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initiative's alignment with the organization's financial goals. The budget is monitored and
evaluated, with flexibility incorporated for unforeseeable circumstances. Conflicting
information, such as expense estimates and revenue projections, is acknowledged,
considering factors like inflation, market trends, sales forecasts, patient preferences,
and risk assessments.
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Strategic Plan and Evaluation Criteria
Developing a strategic plan involves aligning the financial plan with the organization's
mission, and defining measurable and attainable goals. Strategic planning addresses
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current needs, evaluates resources, identifies uncertainties, and prepares staff and
leaders for potential adjustments. The budget's focus on employee retention and
patient-centered care aligns with the organization's goals, as both are interlinked.
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To enhance employee retention, competitive compensation and benefit packages are

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prioritized, fostering a positive workplace culture. Patient-centered care involves

effective communication, education, and engagement, with patient feedback systems to
evaluate satisfaction levels. Training and development initiatives aim to enhance skills
and leadership capabilities. Evaluation criteria include annual staff retention rates,
patient surveys, and clinical quality indicators.
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Ongoing Budget Management
Budget management is an ongoing cyclic process, requiring continuous analysis,

development, and monitoring. Data is collected every three months to assess long-term
sustainability, track quality indicators, and receive departmental reports. A SWOT
analysis is conducted to evaluate data and implement changes in the budget. Positive
environmental changes, appreciation, and increased staff satisfaction are assumed to
contribute to eradicating clinical quality issues. The ongoing budget emphasizes
reducing non-productive time, ensuring accurate tracking of employees' clock-in and
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clock-out times, evaluating overtime quality,
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References
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Abdulsalam, Y., & Schneller, E. (2019). Hospital supply expenses: An important ingredient in
health services research. Medical Care Research and Review, 76(2), 240–252.
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https://doi.org/10.1177/1077558717719928
Alsadaan, N., Salameh, B., Reshia, F. A. A. E., et al. (2023). Impact of nurse leaders' behaviors
on nursing staff performance: A systematic review of the literature. INQUIRY: The Journal of
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Health Care Organization, Provision, and Financing, 60, 004695802311785.
https://doi.org/10.1177/00469580231178528
Brennan, D., & Wendt, L. (2021). Increasing quality and patient outcomes with staff engagement
and shared governance. OJIN: The Online Journal of Issues in Nursing, 26(2).
https://doi.org/10.3912/OJIN.Vol26No02PPT23
Kwame, A., & Petrucka, P. M. (2021). A literature-based study of patient-centered care and
communication in nurse-patient interactions: Barriers, facilitators, and the way forward. BMC
Nursing, 20(1), 158. https://doi.org/10.1186/s12912-021-00684-2
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Nilsen, P., Seing, I., Ericsson, C., Birken, S. A., & Schildmeijer, K. (2020). Characteristics of
successful changes in health care organizations: An interview study with physicians, registered
nurses, and assistant nurses. BMC Health Services Research, 20(1), 147.
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https://doi.org/10.1186/s12913-020-4999-8
Sonmez Cakir, F., & Adiguzel, Z. (2020). Analysis of leader effectiveness in organization and
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knowledge sharing behavior on employees and organization. SAGE Open, 10(1),
215824402091463. https://doi.org/10.1177/2158244020914634
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Specchia, M. L., Cozzolino, M. R., Carini, E., et al. (2021). Leadership styles and nurses’ job
satisfaction. Results of a systematic review. International Journal of Environmental Research
and Public Health, 18(4), 1552. https://doi.org/10.3390/ijerph18041552
Weyman, A. K., Glendinning, R., Costa, J., et al. (2023). Should I stay or should I go? NHS staff
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retention in the post COVID-19 world: Challenges and prospects.

https://doi.org/10.5281/zenodo.7611656
Wong, K., Chan, A. H. S., & Ngan, S. C. (2019). The effect of long working hours and overtime
on occupational health: A meta-analysis of evidence from 1998 to 2018. International Journal of
Environmental Research and Public Health, 16(12), 2102.
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https://doi.org/10.3390/ijerph16122102
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NURS FPX 6216 Assessment 2 Preparing and Managing An Operating Budget

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Assessment 2: Preparing and Managing an Operating Budget

In healthcare management, the evolving landscape demands strategic planning,

patient-centered care (Alsadaan et al., 2023). This knowledge empowers nursing

ensuring overall satisfaction.

Similarly, effective nursing management is linked to improved patient outcomes by

and patient-centered care, seeking to achieve these goals through performance

thereby benefiting both staff and patients (Specchia et al., 2021).

To develop an effective budget, baseline data is essential to understand the

Budget Creation and Design

The budget creation process involves systematic planning, analysis, and

Strategic Plan and Evaluation Criteria

To enhance employee retention, competitive compensation and benefit packages are

prioritized, fostering a positive workplace culture. Patient-centered care involves

Budget management is an ongoing cyclic process, requiring continuous analysis,

retention in the post COVID-19 world: Challenges and prospects.

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