you will develop a personnel budget for the new outpatient coding section of the HIM department as discussed in your previous assignments.
In year’s past the hospital has contracted coding services out to Mega-Coders-R-Us. The contract with Mega-Coders is set to expire at the end of the current fiscal year. The hospital has determined to bring coding function back in-house. Your budget will thus be used to justify the number of FTEs needed for the outpatient coding section.
For the purpose of this assignment you may assume that the facility is paperless and operates a true electronic health record.
In FY 2013 Mega-Coders processed the following numbers of patient records for the facility:
-55,000 Outpatient Encounters
-13,000 Outpatient Surgeries
-29,000 Emergency Room Encounters
-11,800 Inpatient Admissions
Your budget will be made up of the following sections containing, at a minimum, the information listed below:
A. Hourly Personnel Justification for the Outpatient Coding section only
– Use this to determine how many FTE’s you are going to need to staff your section.
B. Chart of Accounts Numbering System
You can use any numbering system you wish. Must have at a minimum:
C. Prepare a Personnel Budget for a one year period for the outpatient coding section. Please denote, at a minimum, the following:
1. Account number
3. Hourly Wage or Salary
4. Annual base income (based on a 40 hour week)
5. Benefits – calculated at 35% of employee’s annual base rate
6. Total Annual Salary/Benefits
You may set your budget up in a Word table or Excel Spreadsheet. Be aware that Excel does not allow for robust comments from the grader. If you submit in Excel you will receive a grade only. No comments will be made.
Eleven points each will be assigned to sections A and C of the assignment.
Three points will be assigned to section B.
This assignment is designed to meet the following performance objectives:
4. Monitor and report staffing levels and productivity standards for health information functions.
1. Make recommendations for items to include in budgets and contracts.
2. Monitor and order supplies needed for work processes.
Health Information II
Liebler Chapter 7
Introduction – A budget is a proposed plan for revenues and expenditures for a set period of time. In today’s discussion we will cover:
I. Budget Periods
II. Types of Budgets
III. Approaches to Budgets
IV. The Budgetary Process
V. Expense Types
I. Budget Periods – We have stated that a budget is a proposed plan for revenues and expenditures for a set period of time.
A. Fiscal Year – A 12 month period for which an organization plans the use of its funds.
1. May or may not match a traditional calendar year
a. U.S. Gov. fiscal year runs 1 Oct. – 30 Sept.
b. ISU runs 1 Jul. – 30 Jun.
B. Periodic Moving Budget – A basic forecast for a period of time which is adjusted as specific time periods are complete.
1. Most often used time period is three months or 1 quarter
C. Milestone budgeting – Budget is tied to projects and plans
II. Budget Types
A. Revenue and Expense Budget – Most common type of budget. Reflects anticipated revenue vs. anticipated costs.
B. Fixed and Variable Budgets
1. Fixed budget is designed to remain unchanged
2. Variable budget is designed to adjust per level of activity
C. Step Budget – Shows several possibilities should revenue deviate from projected levels
D. Master Budget – This is a composite budget for the entire organization.
1. Uniform Code of Accounts – AKA Uniform Chart of Accounts or Chart of Accounts.
2. Cost Centers – Refers to departments within an organization which generate revenue/incur expenses.
3. Responsibility Center – Refers to a unit within the organization and the individual having authority over that unit.
III. Budgetary Approaches – There are two widely used approached to budgeting.
A. Incremental Budgeting – The coming years budget is based on the previous year’s budget, and adjusted up or down by some percentage.
B. Planning-Programming-Budget System – AKA Zero Base Budgeting – Budget starts from zero every year and each budget request must be justified.
IV. Budgetary Process – The budgetary process is cyclical and contains three steps.
A. Initial Preparation
2. The setting of limits
5. Unit responsibility
B. Review and Approval
1. Competition, bargaining and compromise
2. Presentation of supporting facts
3. Internal review process
4. Final approval
1. Budget is spent
2. Regular comparisons
3. Being preparation for next year
V. Types of Expenses – We will focus on capital expenses, supplies, and personnel
A. Capital expenses – expenditures used to acquire or upgrade physical assets such as equipment, property, and buildings.
1. Life expectancy
B. Supplies and other expenses – Typically considered “consumables.”
C. Personnel – Typically the largest category of expense in any budget.
1. Can be as much as 85% of an organizations budget
2. Benefits are figured at 35% of base wage
3. How to figure an FTE