Operational Budget

1454 Words Oct 28th, 2013 6 Pages
Phase 4 DB

HCM410-1303B-02
September 14, 2013
Operational Budget with addition of 4 new areas

Introduction
The Krona Community Hospital, established in 1977, is a 60-bed, acute care hospital located in Banconota County. They currently offer a full range of health care services and maintain a staff of almost 100 physicians and specialists, 400 employees, as well as numerous volunteers. They are currently fully accredited by The Joint Commission.

A private, not-for profit health care chain called Nouveau Health has taken over the management of Krona Hospital. The new facility that has been proposed to the state officials for approval, will include 74 acute care beds, all of which will be private. It will also include four
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Another source of funding is Grants. Based on our geographic location and demographics, we qualify for funding from several different foundations that provide grants to community facilities that need financing for building cost to expand on their facility. Now that we have been approved for our new renovation and the addition of many more services, we have $3 million dollars we can add to our operations budget as funding for this new expansion.

Methodology in Revenue Forecasting
Reliable forecasts of revenue are a vital part of the organization’s planning process and are an input into the operating budget. Forecasts of revenue will cover varying time periods and serve different purposes (Baker, 2013). A 5-year forecast is typically used for executive decision making regarding the organization’s future, while a short-range forecast is typically for a single year and is helpful in determining trend and annual changes to the operational budget. For the purpose of this assignment, my method of revenue forecasting was based on utilization as well as trend analysis. This will allow me to calculate some of the factors to determine the unknowns in my budget, using the past trends in other areas.

How New Services Impact Revenue
The new services will certainly have a positive impact on revenue, although the initial cost of getting things into place will take time

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