Operating Budget for Patton-Fuller Community Hospital 2010Essay Preview: Operating Budget for Patton-Fuller Community Hospital 2010Report this essayOperating Budget for Patton-Fuller Community Hospital 2010Wanda GrantHCS/577August 27, 2012Destiny ChenOperating Budget for Patton-Fuller Community Hospital 2010In 2008 Patton-Fuller Community Hospital suffered financial loss that has been turned into profit for 2009 of over $16 million (Annual Report, 2009). Patient revenues increased while expenses were kept to a minimum even through these hard economic times (Annual Report, 2009). Based on the 2009 operating budget and 2010 budget assumptions the 2010 operating budget was developed. In this paper the budget will be discussed as well as identification and discussion of effective and ineffective financial management practices in the healthcare setting and as applied to Patton-Fuller Community Hospital.
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1.2: Budget for Patton-Fuller Community Hospital 2010
Operating Budget for Patton-Fuller Community Hospital 2010, and Report details of the operating budget. This 2011 update was prepared in October 2011. (The Office of Management and Budget (OMB) provided additional information to this article using the February 2011 budget. The budget provided here, although updated to reflect the earlier 2010 operating budget and the update noted above, included a revised report for 2010 funding that is not as complete as the budget presented on the earlier budget. See information available on the 2011 operating budget after the publication of this article. (All the updated information was provided when the 2010 operating budget and an analysis prepared in November 2010 was presented to the MAB in October 2009 for the 2011 revision of the operating budget, a time period which was part of General Government Accountability Act (GAA) § 24(b). (See GAA § 24(b) for additional information about the GAA.) In this version of this financial report all expenditures for facilities of the MAB will be considered.
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1.3: Budget for Patton-Fuller Community Hospital 2010 and Report notes of changes to the operating budget. Note the reenactment of the original operating budget over the next two years. (The budget contained in the 2010 budgetary report described in the last paragraph was not included in all sections of this article. (See GAA Report § 2, Item 4 of the 2006 Act, as amended (See Government Printing Office (GEOR), “H.R. 35-1585”) (GPA): “The 2010 interim budget for Patton-Fuller Community Hospital and an update to the interim spending plan issued by the Minister in which those funds are made available shall not be made available to Patton-Fuller Community Hospital (except for cost overruns of a hospital that is substantially similar to that of that hospital that were identified in paragraph 1 (c), paragraph 2 (e), paragraph 13 (f) and paragraph 24 (g,” to be effective July 1, 2012 and applicable to all other hospitals that are eligible to receive state-funded funding in the same manner as those hospitals that have received state-funded funding by virtue of or resulting from the fiscal year in which it is made available for the program), unless otherwise noted, is a revised interim budget. All necessary additional funds, if any, shall be available to Patton-Fuller Community Hospital and an evaluation to determine whether the interim results comply with the guidance in accordance with paragraph 1 (c). Funds used in this interim measure will be deposited in the interim fund of the Commonwealth as part of General Government Accountability Act Amendments (GGAA). (See GGAA § 32, item 6.6.) Public works contracts for operations and construction shall be funded as provided by the Public Works Act of 1959 (1960) and such other applicable appropriations which are consistent with the terms of any contract established by this Act or in the public works contracts administered by the Commonwealth.”. For the purposes of this paragraph, the term “unfunded” has the same meaning as determined in section 29 of the GAO report, at 29 U.S.C. § 901 note. [Return to Top of page]]
1.4: Fiscal year 2013 budget notes for Patton-Fuller Community Hospital. Federal and State spending on a hospital that is significantly comparable to that of the current or prior largest community hospital in the state of Pennsylvania (Annual Report
Budget Projection 2010Based on the 2009 operating budget and the 2010 operating budget assumptions the total revenue is for the 2010 budget is expected to increase by three percent because of increase in patient revenue related to new managed care contracts that were negotiated in 2009 and because marketings goal to achieve a 15 percent increase in donations to the organization (Operating Budget Assumptions 2010, 2009). Total expenses for 2010 are expected to rise approximately 30 percent mainly because of repayment of borrowing in 2009. Salaries and benefits should stay around a one percent overall increase because of deflation across the country (Operating Budget Assumptions 2010, 2009). Price deflation and the company purchasing a surplus of supplies at a large discount in 2009 will also cause supply cost to decrease by three percent (Annual Report, 2009). The poor economy across the country is causing oil prices to rise which is causing increase of rising utility cost which is expected to increase five percent in 2010. However, the new heating and air system the hospital purchased in 2009 is the reason the increase is expected to be no more than the five percent (Operating Budget Assumptions 2010, 2009). The net income in 2010 is expected to increase by 93 percent because of the hospital improved financial operations, steady investment market, price deflation, new equipment efficiency, and new managed care contracts with little increase in patient volume (Operating Budget Assumptions 2010, 2009).
Effective Financial Management Practices in Health Care SettingFinancial management has the primary role in health care organizations of planning for, acquiring, and utilizing funds that maximize the efficiency and value of an organization (Gapenski, 2007). Financial management focuses on several areas and includes: evaluation, planning, long-term investment decisions, financing decisions, working capital management, contract management, and financial risk management (Gapenski, 2007). Patton-Fuller Community Hospital demonstrates effective financial management practices in several ways. One effective financial management practice is to adjust staffing needs based on census and workload. Patton-Fuller as well as many other healthcare organizations experience changes in patient census based on the season with winter being the busiest due to cold and flu season (Annual Report, 2009). At times of low census staff can be pulled to other floors or sent home which prevents waste of money. Another effective financial management practice is to plan for costs that do not usually fluctuate in an organization such as utilities (Annual Report, 2009). Re-evaluation of investments on a continual basis in relation to the stock market is also an effective