After your monthly review of your unit’s operational budget, you find you are over your budget for medical supplies. What steps would you take to investigate why this happened and how to correct the issue?
After your monthly review of your unit’s operational budget, you find you are over your budget for medical supplies. What steps would you take to investigate why this happened and how to correct the issue?
After your monthly review of your unit’s operational budget, you find you are over your budget for medical supplies. What steps would you take to investigate why this happened and how to correct the issue?
TAMEKA
It is incredible what we learn through weekly class discussions and from each other’s posts and how applicable it is to our careers. Often managers speak about budget, staffing, supplies, and resources, and from this week’s readings, this writer has learned other importances of budgeting for businesses. Budgets help organizations control spending, determine priorities, plan for future growth, plan for the unexpected decline, plan for large capital expenditure and identify new investment opportunities (Biermeier, 2016). In healthcare, budgets are essential to reporting activities and resources used and have three primary functions planning, reporting, and managing (Penner, 2017). Managers use operating budgets to help evaluate how well a unit or organization is doing with its income and expenses. “Operating budgets are used in the day-to-day management of health settings” (Penner, 2017). Adequate resources, whether human or physical, are needed to provide safe and efficient care, which can affect a unit’s operating budget.
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A manager or leader must not turn a blind eye when there is an over-the-budget of medical supplies or when costs exceed revenues. There must be some investigation or evaluation of why this has happened to solve or correct the issue. Overbudgeting can negatively impact patient outcomes, departmental outcomes, and the department’s staff. Several steps can be used to investigate a department’s overbudgeting. A manager should evaluate if the overbudget is due to internal factors such as waste of resources, increased patient count, or external factors such as increased medical supplies. Review reports and the budget to ensure there is no error on the part of the manager. Communicate budget issues with staff and reinforce the importance of staying within budget; communication is a great way to get staff involved in action plans, feedback and to help problem-solve any departmental issues. Monitoring staff adherence to planned budget; helps identify as soon as possible if there will be an issue with overbudgeting so the problem can be addressed promptly to avoid more significant problems in the future (Walsh, 2016). Managers must do a budget investigation to determine the root cause of budget problems and consider variances and supply chain management (Penner, 2017). Proper budgeting and keeping within budget limits can make or break a unit’s or an organization’s optimal functioning and overall outcomes.
References
Biermeier, C. (2016). The importance of having a budget. https://www.wegnercpas.com/the-importance-of-having-a-budget/
Penner, S. J. (2017). Economics and Financial Management for Nurses and Nurse Leaders (3rd ed.). Springer Publishing Company. ISBN: 978-0-8261-6001-0
Wlsh, K. (2016). Managing a budget in healthcare professional education. Annals of Medical and Health Sciences Research, 6(2), 71-73. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4866369/
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