The document discusses how to create a budget for a hospital or educational institution. It outlines 10 steps for developing a hospital budget, including determining revenue sources, calculating expenses for facilities, equipment, personnel, and medical costs. Revenue comes from payments, taxes, donations, and insurance. Expenses include maintaining buildings, departments, equipment, beds, and staffing costs. The budget process requires estimating these factors. For an educational institution, the budget has revenue, expenditure, and capital sections. Recurring costs include fees, salaries, supplies while non-recurring includes endowments, deposits, and certifications. The samples budgets showed revenue exceeding expenses.

1. PREPARED BY,
Mrs. Rijo Lijo
Lecturer.

2.  Making a hospital budget is only second to
medical delivery systems in for a hospital. In fact,
if a budget is not properly written, the hospital
may be unable to deliver medical services at all.
So many expenses and sources of revenue must be
taken into consideration, so the budget process
takes an expert to get through it successfully.

3.  1. Determine hospital revenue.
 Revenue can come from patient payments, tax
dollars, donations, insurance credits.
 Be sure to deduct a percentage of the patient bills
that will remain uncollected, the charity work
expected by the hospital and the pro bono work it
does.

4.  2. Figure out expenses.
 Start with the physical facility.
 How much does it cost to keep up the building or
buildings.
 What is the maintenance cost of each department,
engineering, air-conditioning, heat, water, other
utilities.
 Know what equipment costs, how much must be
replaced per patient day, and if any can be recycled.
 Include the non-medical cost of each bed in the
hospital. Include advertising.

5.  3. Know the cost of
 Personnel, all employees and ancillary staff, including
consultants, outsourced contracts, perhaps laundry or
nurse staffing services.
 For all employees of the hospital, from janitorial to
hospitalists, figure the fringe benefits the hospital must
pay for each.

6.  4. Add all medical equipment costs, ongoing and
expected expansion or replacement of new diagnostic
equipment.

7.  5. Know the medical costs of each bed.
 How many staff hours are spent on each bed,
occupied or not.
 Use this figure as an average to get a cost per patient
year.
 Add to that the non medical costs per bed.
 Include every possible cost that keeps that bed in the
hospital.
 Don't forget replacement costs per annum for any and
all patient needs.

8.  6. What about expansion?
 Are you planning a new wing, or the renovation of an
old one?
 Are you expanding into a new specialty that could
bring in extra revenue?
 Estimate that revenue when planning your budget.

9.  7. Don't forget parking garages, lots, landscaping,
grounds keeping or window washing.
 8. Include all insurance for the facility and personnel.
 9. Write in an emergency expense fund. Disasters occur
and the hospital must be prepared for them when they
arrive.
 10. To do the budget, use a spreadsheet.

10.  BUDGET FOR EDUCATIONAL INSTITUTION.
 School should have a separate budget, i.e. principal in
charge of the school of nursing should be the drawing
and disbursing officer and empowered to plan for
operating the funds in all different heads (as per
government rules and regulations and as seemed
necessary for running an educational institutions).

11.  Both the school/college and hospital should have
separate budget. The budget for the school or college is
annually planned by the nursing director, principal and
general manager and approved by the managing
director.

12.  The budget is classified into 3 heads as
 Revenue.
 Expenditure.
 Capital.

13.  1. Revenue: It includes assets, fixed deposits,
investments, loan, advances and income.
 2. Expenditure: It includes capital, recurring
annual mandatory and non recurring.

14.  The recurring annual mandatory expenditure includes:
 - University Administration Fees – Rs. 50,000/
 - Affiliation Fees – Rs.3,00,000/
 - and every year Rs 50,000/- per course
 - Inspection Fees Rs 25,000/-
 - State council – Rs 7000/ every year for recognition.
 - INC recognition fees Rs 50,000/ per course.
 - INC inspection or affiliation fees is 7,500/
 - Reinspection fees 7000/
 - Affiliation fees to other institution.

15.  The recurring monthly expenditure also include:
 - Rent.
 - Salary.
 - Stationary items.
 - Contingency.
 - Guest relation.
 - House keeping indent.
 - Pharmacy indent.
 - AV aids - Journals - Books - Maintenance: Repair, Replacement,
Electricity, Phone, Drinking Water, Sewage Disposal.

16.  Non recurring expenditure includes:
 - DME endowment: Endowment Fund (property or
income left to someone like insurance) Rs
20,00,000/- in two installments (before one year
10,00,000/ and second year Rs.10,00,000/) which is
paid to the DME office.
 - Security fixed deposit Rs.10,00,000/ with the joint
account of registrar of the university and trustees. -
Solvency certificate(state of having more money than
one owes) for Rs. 30,00,000/ from nationalized bank
for a period of 5 years.

17.  - University endowment.
 Approximately the Revenue is Rs. 21,24,000/ and
where as the Expenditure is Rs. 20,52,859/.
 Annual auditing is done to plan for the next year
budget and to evaluate the current year budget.