REVENUE, EXPENSE ANALYSIS

&
PERFORMANCE EVALUATION

NOCHE MAY R. BUENA, R.N

At the end of the presentation, MAN students will be able to:

1. Understand the difference between revenue and expense in a

nursing unit budget.

2. Analyze the financial status of a nursing unit based on

performance evaluation report.

3. Know the computation of profit and variance.

What is Cost Control???

Minimizing costs the company must

expend without sacrificing the end
product (service/food) that the
customer receives.
Reven
ue is based on charges and is the
money the organization will
receive for a patient visit,
procedure, or inpatient
hospitalization from Medicare,
Medicaid, managed care, private
insurers, and self-pay patients.
EXPENSE include the cost of staff,
activities, supplies, and so
forth in running the nursing
unit.

Operating expense budget:

-Personnel expenses

-Non-personnel expenses
Personnel Expense

High costs so require close monitoring

Nurse manager often able to control these costs
Personnel expenses:
Straight time and overtime hours
Differentials and premiums for shifts, weekends and
holidays
Benefits, paid leave
Travelling and per diem nurse hours
Operating Expense Budget:
Non-personnel

Fixed non-personnel expenses:

Office supplies
Training, staff education supplies
Depreciation
Overhead or administrative expenses

Flexible non-personnel expenses:

Medical supplies
Why focus on the operating expense
budget?

Operating expenses are assumed to be under the control and

supervision of the nurse manager.

Your understanding of acute care nursing unit budgets will

transfer to the review of other health care budgets.
Revenue and Expense
Revenue - Expenses = Profit

Revenue Desired Profit = Ideal Expense

Expense
Revenue = Expense %
PERFORMANCE aims to assess the extent to
which the nursing unit added
EVALUATION wealth or income to the
institution and whether its
performance is above or
below the market norm.
 Table 1. Nursing Unit Expense Budget
Variance
20 staffed beds, June 2013 ($ thousands)

Budget Actual
Current Prior YTD
Item June June Variance
YTD 2013 2012
2013 2013

Patient Days 360 347 -13 3,240 3,164

Productive $ 200 $ 220 -$20 $ 1,248 $ 1,257
Non-productive $ 50 $ 53 -$3 $ 312 $ 309
Total Personnel $ 250 $ 273 -$23 $ 1,560 $ 1,566
Supplies $ 25 $ 26 -$1 $ 153 $ 144
Overhead $ 10 $ 10 $0 $ 60 $ 60
Total Non-personnel $ 35 $ 36 -$1 $ 213 $ 204
Total
Expenses $ 285 $ 309 -$24 $ 1,773 $ 1,770
In order to carry a positive
action, we must develop a
positive vision.

--DALAI LAMA
REFERRENCES:

1. www.accountinginfocus.com
2. Slideshare.com
3. Fiscal Management Handbook, Edward G. Rendell,
Commonwealth of Pennsylvania,
 SUMMARY
The more efficient the control of stock is, the less will be wasted or stored
unnecessarily.
Good stock control:
Saves time
Saves money
Makes sure the workplace is more efficient.
You can use paper based and computer based stock control methods to:
Record the movement of stock items
Maintain stock lists
Adjust levels to meet demand.