This number, also calculated by the finance department, reflects the patient demographics. The higher the number, the higher the reimbursement level. This is a number that is calculated by the finance department for the organization. Each hospital and nursing facility calculates an overall case-mix index. Generally, the more complex the case, the higher the reimbursement. The nurse manager knows that another surgeon is coming on staff who will bring increased volume to the facility, thus justifying the need for increasing the bed capacity. For example, a nurse manager may plan to increase bed capacity on an underutilized nursing unit as the census has increased the past year. That person knows best what services are currently offered and will be offered in the future. This data is collected by the nurse manager. The finance department ultimately collects the data, but this is done in collaboration with the nurse manager to create a functional budget. Spreadsheets, typically in Microsoft Excel, are used to calculate all budget components at the unit level.Ī critical task in creating a budget is collecting relevant data. Taking corrective measures when necessary.The budget-development work flow involves the following steps: It should provide feedback this is essential in managing the budget. The budgeting process is ongoing and dynamic. After the budget is approved and the fiscal year begins, the organization must deliver the planned services and programs. After the budget has been developed and updated, it is submitted to administration and ultimately to the board of directors for approval. Nurse managers set goals and design the budget (usually in collaboration with the finance department) for their own responsibility center, or nursing unit.

This chapter from the newly revised second edition of The Nurse Manager's Guide to Budgeting & Finance explores the six steps of the budget-development work flow.

Nursing home budget spreadsheet