NR 533 Financial Management in Healthcare Organizations
Section One—Staffing Budget and FTEs
Personnel Budget Case Study
Sandra Chambers has recently stepped into the role of assistant administrator for the Department of Nursing at Potter Regional Medical Center. In her new position, she is responsible for overseeing the operations of five distinct medical units. Upon reviewing the budgets for these units, Sandra notices that all five are operating at or near full capacity. While four of these units have experienced stable patient volumes over the past two years, the fifth unit has seen a consistent increase in patient volume, currently functioning at 88% capacity. Projections indicate that within the next 12 months, patient volume in this unit will rise by an additional 20%.
Sandra’s primary challenge is to determine whether the current Full-Time Equivalents (FTEs) allocated to the unit are sufficient to maintain quality and safety in patient care with the anticipated increase in patient volume. If the current FTEs are inadequate, Sandra must calculate the number of additional FTEs required to handle the increased demand.
Information Required for FTE Projections
To accurately project the necessary FTEs for the next fiscal year, Sandra must gather comprehensive background information on the unit. The data collection process should include:
- Historical Data Analysis:
- Sandra should review historical data from the past year to identify trends in census, patient volume, staffing needs, and vacancies. This data will provide a baseline for understanding how the unit has managed previous workloads and whether current staffing levels have been sufficient.
- A focus on FTE trends over the past year will help determine whether staffing levels have remained consistent, increased, or decreased in response to patient volume fluctuations.
- Patient Acuity and Staffing Ratios:
- It is essential to analyze patient acuity levels to determine the appropriate staffing ratio. Higher acuity patients require more intensive care, thereby necessitating a higher nurse-to-patient ratio. Sandra should consider the complexity of care required by patients in the unit to ensure that staffing ratios are aligned with patient needs.
- Utilizing patient acuity data will allow Sandra to calculate the optimal number of FTEs required to deliver safe and efficient care as patient volume increases.
- Trend Analysis Using Spreadsheets:
- Sandra should use spreadsheets to track key metrics such as patient days, length of stay, occupancy percentages, and staffing ratios. This will help visualize trends and patterns, making it easier to project future staffing needs.
- By organizing this data into a spreadsheet, Sandra can model different scenarios to determine how changes in patient volume will impact staffing requirements.
- Unit Background and Organizational Data:
- Sandra should also familiarize herself with the unit’s previous budgets and staffing plans. Understanding how the unit has historically managed its personnel budget will be critical in planning for future needs.
- It is also important to consider organizational policies and benchmarks for staffing levels to ensure that the unit remains compliant with institutional standards.