UTA NURS4455 Module 3 Assignment 1 Latest 2020 September

NURS4455 Nursing Leadership and Management

Module 3 Assignment 1

Financial Management Case Study vfa20(1)

Name:                  Date:    

Overview: Financial Management Case Study

One of the important duties of a nurse leader is to manage personnel and personnel budgets. In this assignment, you will assume the role of a nurse manager. You will use given data to make important decisions regarding budgets and staffing.

Some nurse managers have computer spreadsheets or software applications to help them make decisions regarding budgets and staffing. You will only need simple mathematical operations* to perform the needed calculations in this assignment because the scenario has been simplified. Furthermore,some data have been provided for you that a nurse leader might need to gather or compute in a real setting. Still, you will get a glimpse of the complexity of responsibilities nurse leaders shoulder regarding financial management.

•             To calculate the percent of the whole a given number represents, follow these steps:

Change the percentage to a decimal number by moving the decimal twice to the left (or dividing by 100).

Multiply the new decimal number by the whole.

Example: What is 30% of 70?

30%= .30; (.30) × 70 = 21

•             To find out what percentage a number represents in relation to the whole, follow these steps:

Divide the number by the whole (usually the small number by the large number).

Change the decimal answer to percent by moving the decimal twice to the right (or multiplying by 100).

Example: What percent of 45 is 10?

10 ÷ 45 = .222; so, 10 is 22% of 45.

* You will only need addition, subtraction, multiplication, and division.

Case Study

You are the manager for 3 West, a medical/surgical unit. You have been given the following data to assist you in preparing your budget for the upcoming fiscal year.

Patient Data

Average Daily Census (ADC): 55

Budget based on 6.2Avg.Hours per patient day (HPPD)

(6.2HPPD excludesNurse Manager and unit secretaries)

Staff Data

Total FTEs                            40.0 Variable FTEs

                                                1.0 Nurse Manager

                                                2.5 Unit Secretaries

                                                43.5Total FTEs      

Staffing Mix

                                                RN          75%

                                                LVN        10%

                                                NA          15%

Average Salary Scale per Employee

Benefits are 35% of annual salaries

Nurse Manager                $75,000.00 per year

Registered Nurses (RN)                $34.00 per hour

Licensed Vocational Nurses (LVN)            $20.00 per hour

Nurse Aides (NA)             $14.50 per hour

Unit Secretary (US)         $12.00 per hour

Questions

1.            How many RNs, LVNs, and NAs, by category, are on the staff of 3 West? (Round FTEsto the nearest tenth.)Compute totals for each column.

Positions              Variable FTEs     % by Position     FTEs by Position

RN          40           0.75        30

LVN        40                          

NA          40                          

Totals                   

2.            Compute the annual salary budget for 3 West.

Compute totals for appropriate columns.

Positions              FTEs       Salary    Hours    Salary Subtotals                Amount of Benefits        Total

MANAGER          1.0          $75,000 XXXX     $75,000 $26,250

RN          30           $34         2080       $2,121,600                          

LVN                                        2080                                      

NA                                          2080                                      

Sec                                         2080                                      

Totals                    XXXXX   XXXXXX                                               

3.            Your hospital unit, 3 West, is a 60-bed general medical-surgical unit. Over the past year, the ADC (Ave. Daily Census) was 55 patients.

Use the following data on 3 West during the last year to perform these calculations and answer these questions.

A.            Complete this table to calculate the actualaverage hours of care required per patient day (HPPD) for the patients in 3 West.Round to the nearest tenth

Acuity Mix           Average Hours of Care Required               Average Daily Census

(ADC)    Total Hours of Care Per Day

I               1.4          8              11.2

II             3.9          21          

III            5.6          19          

IV            8.8          7             

Totals                   

Hours per patient day (HPPD)   

B.            Remember that your established personnel budget for 3 West assumes a HPPD of 6.2. If your calculated HPPD is different, explain the significance of the variance. (If your calculated HPPD is different than 6.2, you must write more than, “We need more/less nurses.”)

                What is the Significance of the variance?  If you believe you need more staff, what will be your                 rationale for making this requires?  If you have too much staff, what would your proposal be for         bringing your staffing into a better balance?

C.            What are the implications for the Nurse Manager?  As an example, based on your conclusions in Section B, what other observations would you make as you review your total budget and what would you expect to see as a result?  (Ex: supply costs; overtime hours, average census of 50 on a 60 bed unit, etc.)

4.            Youhave set two new goals for your unit for the next year related to personnel:

•             Provide stronger unit management support on evening and night shifts and inthe absence of the manager.

•             Correct unfavorable efficiency variances due to overtime.

To accomplish these goals, you plan to make these changes:

•             Add 1.0 RN FTE position

•             Eliminate 1.5 LVN positions

•             Add 1.5 FTEs NA positions

•             Add 1.0 Assistant HN position at $62,000/year

Calculate ONLY the costof the proposed recommendations for 3 West.Compute totals for each column. If the change represents a reduction in the budget for that category, record the total as a negative number. If it represents an increase in the budget for that category, record the total as a positive number.

Positions              FTEs       Salary    Hours    Salary Subtotals                Benefits               Total

RN          1                                                                             

LVN        -1.5                                                                       

NA          1.5                                                                         

AHN       1              62,000   XXXXX                                  

Totals    2              XXXXX   XXXXX                                  

5.            Assume your proposal was approved.  Calculate the new personnel budget (You will use your budget from question 2 and account for the changes you requested in question 4). Compute totals for each column.

Positions              FTEs       Salary    Hours    Salary Subtotals                Benefits               Total

Manager              1              $75,000 XXXXX                                  

AHN       1              $62,000 XXXXX                                  

RN          31                                                                          

LVN                                                                                       

NA                                                                                         

Sec                                                                                        

Totals                    XXXXX   XXXXX