San Jose General Hospital Nursing Department Budget


The operating budget is comprised of the expenditure budget and income budget (Mitton et al., 2014). The coming financial year lists predicted revenue by cause and predicted expenditures by II normal classifications, such as wages, purchases, and services. Administration ought to constantly trail a more significant income budget than expenditure budget, consequently protrusive earnings on the bottom line. The earnings are used to fund the resources budget.

The following is a table showing the next quarter year’s budget for the San Jose General Hospital Nursing department. It has detailed expenses and revenues projected for the next quarter of the year given the units’ bed capacity of 35 patients, mainly the elderly. The unit has staff support of 20 full-time equivalent staff who regularly volunteer to work for extra shifts and overtime. All of the hospital revenue comes in through the inpatient, outpatient, and pharmacy services offered at the hospital. There are cases where charitable persons and organizations may donate to the hospital or a particular unit in it. These kinds of revenue are also entered into the operating budget under income revenue for the hospital unit in question. There are several variable costs incurred in the hospital and some fixed costs that may include telephone, rent, insurances, and other kinds of utilities.

The staffing level does not vary in a big way in the nursing units from which the table is derived; instead, the staff works in shifts, and since they are mostly on good terms with the patients, they will from time to time volunteer for extra shifts. They will also work overtime in cases where there has been a lot of work throughout the day. The staffing salaries and wages for additional hours of work done are entered as part of the expenses revenue in the table. Concerning staffing, the patient demographic of 35 beds capacity in the nursing unit is considered as well as the hours worked, whether extra or voluntary.

On the expenses side, the hospital’s revenues are mostly used to settle most of the hospital’s expenditure or for a particular unit in the hospital. Expenditure may include a variety of objects the hospital unit may require to run smoothly. San Jose General Hospitals’ nursing unit expenditures are mostly for supplies and equipment’s both office and hospital. Whether they are medical or office, the equipment and all supplies are paid for by the hospitals’ revenue or units income. Financial statements are a summary of economic outcomes.

The financial declarations prepared after every month are the report of incomes and expenditures, accounted and solid balance sheet, the account of incomes and expenses, accounted and real displays, the income acknowledged throughout the period, and the expenditures experienced through the time. Each income and spending ought to be linked to the anticipated financial plan. This report illustrates the hospital process’s outcomes by replicating earnings or loss on the bottom line. This is also referred to as the Income statement.

The balance page shows the hospital’s fiscal situation. The resources, accountabilities, and assets of the facility are informed. The resources are itemized as current and non-current in the directive of their liquidity. The former are anticipated to be used up in a year while the latter over a more extended period. The liabilities are similarly itemized as current and non-current. The resources unit will be branded stock balance in the instance of a non-profit organization.

San Jose General Hospital Nursing Unit Operating Budget for the Year Ending April 2021

OPERATING REVENUE Financial Year (April 2021) Totals
Operating Revenues Net inpatient income

Net outpatient income

Pharmacy revenue

Charitable donations







Operating Expenses Salaries and Wages

Overtime Salaries







Other direct expenses












Projected profits Net revenue income

Net expenses revenue

Projected profits




Effective budgeting is crucial for improved productivity in healthcare organizations. The operating budget aids in planning the expenditures and incomes of the future financial years in a healthcare organization. It catalogs the revenues and expenditures of an organization after the deliberation of distinct aspects and the analysis of previous accounts to envisage the future. The static and flexible operating budget methods are the leading accounting methods habitually applied in healthcare situations. The former lists expenditures and incomes for a fixed amount of amenity units without dissimilarities through the financial year. The latter regulates the operating expenditures in agreement with the disparity in volume; hence, incomes change. Healthcare organizations apply the different methods after contemplating the efficiency of each reliant on the current situations. The application of the elastic operating budget in the San Jose Healthcare Organization will improve competence in providing care and organizational resources management.

A Plan for Managing the Labor Force within the Parameters of the Budget and Productivity

A financial plan is a device for both planning and control. At the start of the year, the budget is a strategy or standard while completing the period; it functions as a controlling tool that helps the management measure its performance against the plan (Russell, 2014). Comparing the hospital performance to the method proposed helps in improving future performance in terms of patient care. The labor force is one of the main expenses, thus, tight that staffing is crucial in preserving financial health (Hill et al., 2015). There are numerous ways to manage the labor force according to the budget and productivity.

Assigning staff to duties that fit their credentials aids a lot in managing San Jose hospital’s labor force. For instance, in a situation where a nurse performs non-clinical responsibilities that can be done by a non-clinical staff that can be paid less money, this makes it hard for staff to acquire satisfactory results in their work. In this unit, each nurse is assigned to an area where they are best. Applicable enrolment can be upgraded by setting principles for which staff members do which responsibilities. This unit looks at its necessary tasks and decides which credentials are more suitable for the job.

Developing a central staffing pool is also crucial in managing the labor force. When the hospital has a high volume of patients, it can be expensive to use outside agencies to staff the hospital. Instead, setting up a hospital-based staffing pool means the manager will be hiring nurses assigned to a central pool created by the managers. The pool will function in a similar way as an outside agency but would pay the usual salary to the employees without benefits since they are from within the hospital unit.

An Approach to Ongoing Budget Management

Operating budget pacts with the day-to-day expenditures and incomes of the business. Within a health care organization, each unit has its operating budget. There are several approaches to operating budgeting, but this hospital unit chose the activity-based budgeting method, which is an output/input system; nonetheless, it decreases the alterations in the renovation over-stressing on the anticipated charge of the scheduled activities that might be expended for a procedure, unit, service, product, or any extra budget aim. Overhead charges account for the foundation of the cost purpose’s regular depletion of events, not founded merely on some wide-based rate driver such as straight labor periods or machine hours.

The volume of every activity cost driver used by every financial plan aim, for instance, product or service, is defined and increased by the charge per unit of the doings cost driver. The outcome estimates each product’s prices or service centered on rate drivers such as assembly-line situation or checkups and the customary amount-oriented drivers such as undeviating labor periods or units of natural supplies used up. Activity-based accounting expects costs of budget aims by totaling all charges of the activity rate drivers that every product and service is accounted to be used. In assessing the recommended financial plan, management ought to emphasize their devotion to ascertaining the ideal activities instead of just the output/input interactions.

The activity-based approach is more suitable in this hospital unit since it enhances efficiency. By relating each purpose and unit with their expenditure, ABB offers a complete picture of the whole hospital. Based on this distinguishability, the hospital unit is facilitated to recognize and adjacent the performance crack and grab opportunities that may come up. Moreover, by considering each activity that sustains costs, ABB provides better cost control, improving management cost. Lastly, the activity-based approach aids in eliminating redundancy; with ABB’s help, any non-value-added activity or function will be analyzed for taking the corrective measure.

Financial Principles in a Strategic Plan for Achieving Organizational Goals and Fiscal Success

Any individual, business, or nation ought to know where they are and where the company would like to be and plan on achieving set targets. The process of strategic planning uses diagnostic. The modules are realistic given the image of the person, company, or country on its purposely unskilled level, making the required enthusiasm to grow a strategic plan (Duffield et al., 2014). The procedure entails five different steps defined below. The carefully chosen strategy needs to be satisfactorily tough to empower the hospital unit to implement activities contrarily from other departments or effectively achieve the same activities.

A worthy strategic plan comprises of measures in explaining the dream and operation into clear final ideas. The vital since intentional preparation is about allocating resources ultimately and cannot be significant if assets are limitless. Fiscal purposes and fiscal presentation can play an important part in the considered preparation and assessment making procedure, especially during the execution and during the observing phase. Fiscal metrics has been long used as the average for evaluating a business’s presentation. BSC backs up economics’ role in inaugurating and checking particular and assessable fiscal, strategic objectives on an organized, incorporated origin, empowering the business to function competently and efficiently (Kirby, 2015). Some of these financial principles consist of:

Free Cash Flow

It is the quantity for a business’s fiscal reliability and displays exactly how competently its financial assets are used and exploited to produce extra money for forthcoming reserves. It signifies all the cash accessible, subsequently subtracting the investments and functioning principal upsurges after its operational cash flow. Corporations ought to exploit this metric when they expect significant investment expenses in the coming future.

Economic Value Added

It is the final support on the risk attuned foundation and aids running to make operational, well-timed decisions to enlarge companies that upsurge the organization’s financial worth and appliance counteractive activities in those that are rescinding its worth. It is resolute by subtracting the available investment cost from the total revenue. Firms set value-added economic objectives to successfully evaluate their companies’ worth assistances and expand the source distribution route.

Financing Decisions and Capital Structure

Here, funding is restricted to the ideal principal arrangement (debt ratio or leverage). The debt ratio is the level that reduces the business’s price of an investment. The optimum investment arrangement defines the business’s standby copying ability and the danger of possible fiscal misery. Businesses create this arrangement when their capital charge increases on top of their opponents, and there is an absence of forthcoming asset.

Risk Assessment and Management

A company needs to come to terms with its main doubts; ascertaining, assessing, and monitoring the present jeopardies incorporate authority and controlling acquiescence, the possibility of their existence, and economic effect. Formerly, a method needs to be instigated to lessen the sources and impacts of the jeopardies. Firms need to create these valuations when they expect larger ambiguity in the corporate or when there is the necessity to improve the jeopardy values.

Tax Optimization

A lot of the available places, together with the corporate entities, ought to accomplish the tax level accountability assumed in leading trade and apprehend that vindicating hazard similarly decreases anticipated levies. Furthermore, innovative inventiveness, attainments, and manufactured goods expansion plans should be assessed contrary to their tax insinuations and net after-tax involvement in the business’s worth. In general, the presentation must, when probable, be measured on an after-tax basis. Global corporations need to accept this approach when functioning in dissimilar tax surroundings; they can take advantage of the tax irregularities procedures.

Growth Indices

Growth brings about assess auctions, the share growth of a market with proper professional growth regarding declines in money flows, profit limits, and investment revenues. Growth frequently drains cash and excess borrowing funds, and occasionally, antagonistic asset management is necessary to guarantee adequate cash and limited borrowing. Businesses must set growth index objectives when development charges have wadded behind the business norms or significant functioning leverage.

Effective strategic planning includes a group effort amongst the managers, employees, hospital unit, dealers, and other external individuals. The more the administration involves the employees with strategic scheduling, the more they will apprehend the strategy they need to have for the hospital unit. Strategic scheduling also necessities to be elastic. Though it is essential to have objectives for the unit, it should adapt to alterations. It might take longer than anticipated to attain a certain goal; employers need to identify that this is not an issue. The unit can integrate alterations to the plan to place it in a much better place to thrive.


Duffield, C. M., Roche, M. A., Homer, C., Buchan, J., & Dimitrelis, S. (2014). A comparative review of nurse turnover rates and costs across countries. Journal of Advanced Nursing, 70(12), 2703-2712. Web.

Hill, K. S., Higdon, K., Porter, B. W., Rutland, M. D., & Vela, D. K. (2015). Preserving staffing resources as a system: Nurses leading operations and efficiency initiatives. Nursing Economics, 33(1), 26.

Kirby, K. K. (2015). Hours per patient day: not the problem, nor the solution. Nursing Economics, 33(1), 64.

Mitton, C., Dionne, F., & Donaldson, C. (2014). Managing healthcare budgets in times of austerity: the role of program budgeting and marginal analysis. Applied Health Economics and Health Policy, 12(2), 95-102. Web.

Russell, J. (2014). When in doubt, don’t! Nursing Management, 45(5), 22-25. Web.

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