Finance and Economics in Healthcare Delivery

Making the Case for Capital Budget Expenditures

As a nurse, you are probably very aware of and can speak to the emotional reasons behind the need for certain major expenditures such as a new nurse’s lounge or replacing the current patient information system with a new digital system. You would love to see your nurses have a comfortable area where they can rejuvenate from a stressful day with patients. Alternatively, nurses carrying around PDAs would certainly ease the recording and transmission of vital patient information. However, as a nurse manager you need to be able to support those emotional appeals with reliable financial data. Having a place to refresh will help nurses be more efficient, and could reduce sick days and nurse errors. Being able to quickly access doctor’s orders and previous nurse’s comments allows for a more timely response to patients. As your responsibilities expand, you may find yourself at the table when decisions about capital expenditures are being debated. It is therefore to your advantage to understand the workings of a capital budget. Finance and Economics in Healthcare Delivery

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In this Discussion, you consider the impact of both financial and emotional factors in making a capital budget decision,

To prepare:

Review the information on capital budgets in this week’s Learning Resources.

Consider why it is important for nurse managers to understand the capital budget of an organization. How are capital budgets used in your own organization (or one with which you are familiar)?

Reflect on the importance of thinking strategically when developing this type of budget.

Identify a new piece of equipment you would like to see purchased by the organization. Consider how knowledge of capital budgeting could influence your approach to making the request.

Develop strategies for demonstrating the need for this capital expenditure that take into account both financial and emotional considerations. Finance and Economics in Healthcare Delivery

Post an analysis of why it is important for nurse managers to understand principles of capital budgeting. Describe a costly new piece of equipment you would like your organization (or one with which you are familiar) to purchase. Explain strategies for demonstrating the need for this equipment to decision makers. Briefly outline how you could use financial data and emotional appeals to demonstrate the benefits of this purchase.

AND

Respond to at least two of your colleagues on two different days. Suggest an additional strategy for demonstrating the need for the equipment they described and why you believe it might be successful. Finance and Economics in Healthcare Delivery

(I will send the responses soon)

Required Readings

Baker, J., & Baker, R. W. (2014). Health care finance: Basic tools for nonfinancial managers(4th ed.). Burlington, MA: Jones and Bartlett Learning.

Chapter 16, “Capital Expenditure Budgets” (pp. 187–197)

The focus of this chapter is capital expenditure budgets and how they differ from operational budgets. It discusses how to develop and evaluate capital expenditure proposals.

Zelman, W., McCue, M., & Glick, N. (2009). Financial management of health care organizations: An introduction to fundamental tools, concepts, and applications (3rd ed.). Hoboken, NJ: Jossey-Bass.

Retrieved from the Walden Library databases.

Chapter 8, “Capital Financing for Health Care Providers” (pp. 329–373)

This chapter explores two types of financing—equity financing and debt financing—as well as the bond issuance process that can be used to finance capital expenditures. Additionally, the authors discuss the option of lease financing, a possible alternative to the two other types of financing.

Danna, D. (2014). Essential business skills for nurse managers. Health Leaders Media. Retrieved from http://www.healthleadersmedia.com/content.cfm?content_id=204441&topic=WS_HLM2_

This article discusses the need for nurses to understand the business skills necessary in healthcare today.

Himmelstein, D. U., Jun, M., Busse, R., Chevreul, K., Geissler, A., Jeurissen, P., & Woolhandler, S. (2014). A comparison of hospital administrative costs in eight nations: US costs exceed all others by far. Health Affairs, 33(9), 1586-1594.

This article compares the hospital administrative costs in several nations.

Zismer, D., Sterms, J., & Claus, B. (2011). Capital efficiency and integrated health system designs. Healthcare Financial Management, 65(7), 88–90, 92, 94.

Retrieved from the Walden Library databases.

In this article, the author examines how system designs play a crucial role in capital efficiency and return on investment. The author also analyzes how this role may change in the future.

usw1_nurs_6211_discussion_rubric_7.doc

MSN Discussion Rubric

Criteria

Levels of Achievement

Outstanding Performance

Excellent Performance

Competent Performance

Room for Improvement

Poor Performance

Content-Main Posting

30 to 30 points

-Main posting addresses all criteria with 75% of post exceptional depth and breadth supported by credible references.

27 to 29 points

-Main posting addresses all criteria with 75% of post exceptional depth and breadth supported by credible references.

24 to 26 points

Main posting meets expectations. All criteria are addressed with 50% containing good breadth and depth.

21 to 23 points

Main posting addresses most of the criteria. One to two criterion are not addressed or superficially addressed.

0 to 20 points

Main posting does not address all of criteria, superficially addresses criteria. Two or more criteria are not addressed.

Course Requirements and Attendance

20 to 20 points

-Responds to two colleagues’ with posts that are reflective, are justified with credible sources, and ask questions that extend the Discussion.

18 to 19 points

-Responds to two colleagues’ with posts that are reflective, are justified with credible sources, and ask questions that extend the Discussion.

16 to 17 points

Responds to a minimum of two colleagues’ posts, are reflective, and ask questions that extend the Discussion. One post is justified by a credible source.

14 to 15 points

Responds to less than two colleagues’ posts. Posts are on topic, may have some depth, or questions. May extend the Discussion. No credible sources are cited.

0 to 13 points

Responds to less than two colleagues’ posts. Posts may not be on topic, lack depth, do not pose questions that extend the Discussion.

Scholarly Writing Quality

30 to 30 points

-The main posting clearly addresses the Discussion criteria and is written concisely. The main posting is cited with more than two credible references that adhere to the correct format per the APA Manual 6th Edition. No spelling or grammatical errors. ***The use of scholarly sources or real life experiences needs to be included to deepen the Discussion and earn points in reply to fellow students.

27 to 29 points

24 to 26 points

-The main posting clearly addresses the Discussion criteria and is written concisely. The main posting is cited with a minimum of two current credible references that adhere to the correct format per the APA Manual 6th Edition. Contains one to two spelling or grammatical errors.

21 to 23 points

-The main posting is not clearly addressing the Discussion criteria and is not written concisely. The main posting is cited with less than two credible references that may lack credibility and/or do not adhere to the correct format per the APA Manual 6th Edition. Contains more than two spelling or grammatical errors.

0 to 20 points

-The main posting is disorganized and has one reference that may lack credibility and does not adhere to the correct format per the APA Manual 6th Edition or has zero credible references. Contains more than two spelling or grammatical errors.

Professional Communication Effectiveness

20 to 20 points

-Communication is professional and respectful to colleagues and response to faculty questions are answered if posed. -Provides clear, concise opinions and ideas effectively written in Standard Edited English. -Responses posted in the Discussion demonstrate effective professional communication through deep reflective discussion which leads to an exchange of ideas and focus on the weekly Discussion topic.

18 to 19 points

-Communication is professional and respectful to colleagues. -Provides clear, concise opinions and ideas effectively written in Standard Edited English. -Responses posted in the Discussion demonstrate effective professional communication through deep reflective discussion which leads to an exchange of ideas and focus on the weekly Discussion topic. -Responses are cited with at least one credible reference per post and a probing question that extends the Discussion. Adheres to the correct format per the APA Manual 6th Edition. No spelling or grammatical errors.

16 to 17 points

-Communication is professional and respectful to colleagues. -Provides clear, concise opinions and ideas effectively written in Standard Edited English. -Responses posted in the Discussion demonstrate effective professional communication through deep reflective discussion which leads to an exchange of ideas and focus on the weekly Discussion topic. -Responses are cited with at least one credible and/or contain probing questions that extends the Discussion. Adheres to the correct format per the APA Manual 6th Edition. May have one to two spelling or grammatical errors.

14 to 15 points

-Communication is professional and respectful to colleagues. -Provides opinions that may not be concise or ideas not effectively written in Standard Edited English. -Responses posted in the Discussion may lack effective professional communication that does not extend the Discussion, leads to an exchange of ideas and/or not focused on the weekly Discussion topic. -Responses are not cited and/or do not contain a probing question. May not adhere to the correct format per the APA Manual 6th Edition. May have more than two spelling or grammatical errors.

0 to 13 points

-Communication may lack professional tone or be disrespectful to colleagues. -Provides opinions that may not be concise or ideas not effectively written in Standard Edited English -Responses posted in the Discussion lack effective professional communication through discussion that does not extend the Discussion, do not lead to an exchange of ideas and/or not focused on the weekly Discussion topic. -Responses are not cited and do not contain a probing question. May not adhere to the correct format per the APA Manual 6th Edition. May have multiple spelling or grammatical errors.

Timely Submission

0 to 0 points

All criteria met: Initial post submitted on time. Response to two peer initial posts. Response on 3 separate days.

-5 to 0 points

5 points deducted for responding to less than two peers or 5 points deducted for responding less than three days.

-10 to -5 points

5 points deducted for responding to less than two peers and 5 points deducted for responding less than three days.

-10 to -10 points

10 points deducted for Initial post submitted late.

-20 to -15 points

Initial post submitted late and 5 points deducted for responding to less than two peers and/ or 5 points deducted for responding less than three days.