Health Finance Budget Report: Cardiology Department Analysis

This report provides a detailed financial analysis of a cardiology department, outlining the budget, income, and expenditure. It covers staffing costs (cardiologists, nurses, surgeons), consumables, utilities, administration, and depreciation. The income is derived from consultancy, surgery, and medicine. The report includes a break-even analysis to determine financial stability and scalability. The analysis also considers a contingency plan with a 10% reduction in the optimal budget, detailing cost-cutting measures. The report uses formulas to calculate costs and income, providing a comprehensive overview of the financial aspects of the department. The financial activity analysis and break-even analysis charts are also included to show at what level of activity the service 'breaks even'.

Running head: HEALTH FINANCE
Health Finance
Name of the Student:
Name of the University:
Authors Note:

1HEALTH FINANCE
Budget
Expenses Income
Category Item/Costs Formula Calculation Explanatory Notes Category Product/Service Formula Calculation
Staffing cardiologist 3*200*8*5*52 $ 1,248,000.00 This cost holds the consultancy Income Consultancy 1*35*5*52*3500 31850000
Nurse 8*35*8*5*52 $ 593,600.00 Surgery 1*30*5*52*7500 58500000
Surgeon 4*100*8*5*52 $ 832,000.00 Medicine 15*40*7*52*5000 498178240.000001
On costs total cost of staff above x 15% $ 401,040.00 TOTAL INCOME Insert total amount here -> $ 588,528,240.00
TOTAL STAFFING Insert total amount here -> $ 3,074,640.00
Consumables Surgical Instrument (15*2*40*5*52)*500 $ 156,000,000.00 Break Even Calculation
Surgical supplies (20*20*40*5*52)*100 $ 416,000,000.00 TOTAL INCOME $ 588,528,240.00
Medicine (2*20*40*5*52)*19 $ 7,904,000.00 minus TOTAL COSTS PER YEAR $ 588,528,240.00
others (5*2*40*5*52)*20 $ 2,080,000.00 Profit / Loss 0
TOTAL CONSUMABLES Insert total amount here -> $ 581,984,000.00
Utilities Fooding (30*5*30)*50 225000 If the Profit/Loss row is NEGATIVE, your service is LOSING MONEY. Increase your income.
Hotel Expenditure (30*5*30)*80 600000
Misc. (30*5*30)*52 117000
TOTAL UTILITIES Insert total amount here -> $ 942,000.00
Administration Management Staff Wages 25000*52 1300000
Security and maintance 10000*50 500000
Office Supplies 3000*52 156000
Building Rent 7500*52 171600 $ -
TOTAL UTILITIES Insert total amount here -> $ 2,127,600.00
Depreciation Depreciation 2000000*20% $ 400,000.00
In the given case the cardiology departments financial stability and scalability is being
organised. For this respective department various kinds of treatment and consultancy are
required. Therefore thee cardiologist are hired for the consultancy and surgeries. The average
aggregated rate of surgery and the consultancy amounted to $ 200 per hour. All the staffs are
employed for 5 days in a week and works 8 hours per day. One of the doctor operates the
surgery and the other two are for the consultancy proposes (Zelman, 2014). The surgeons and
the nursing staff assist the doctors in surgery and the taking care of. For the consultancy, the
centre charges $3500 per patient. On an average 35 patients comes for the consultancy.
In addition to that, per day the hospital makes cardiac and other heart related surgery
and charges on an average $7500 per patients this includes the food and accommodation of

2HEALTH FINANCE
the students. For the cardiac treatment the patients bears the cost of $5000(each). From the
above mention rates, the hospital earns $588528240 annually.
Expenses Income
Category Item/Costs Formula Calculation Explanatory Notes Category Product/Service Formula Calculation
Staffing cardiologist 3*200*8*5*52 $ 1,372,800.00 This cost holds the consultancy Income Consultancy 1*35*5*52*3500 31850000
Nurse 8*35*8*5*52 $ 652,960.00 Surgery 1*30*5*52*100000 780000000
Surgeon 4*100*8*5*52 $ 915,200.00 Medicine 15*40*7*52*5000 1092000000
On costs total cost of staff above $ 441,144.00 TOTAL INCOME Insert total amount here -> $ 1,903,850,000.00
TOTAL STAFFING Insert total amount here -> $ 3,382,104.00
Consumables Surgical Instrument (15*2*40*5*52)*500 $ 171,600,000.00 Break Even Calculation
Surgical supplies (20*20*40*5*52)*100 $ 457,600,000.00 TOTAL INCOME $ 1,903,850,000.00
Medicine (2*20*40*5*52)*19 $ 8,694,400.00 minus TOTAL COSTS PER YEAR $ 647,381,064.00
others (5*2*40*5*52)*20 $ 2,288,000.00 Profit / Loss 1256468936
TOTAL CONSUMABLES Insert total amount here -> $ 640,182,400.00
Utilities Fooding (30*5*30)*50 247500 If the Profit/Loss row is NEGATIVE, your service is LOSING MONEY. Increase your income.
Hotel Expenditure (30*5*30)*80 660000
Misc. (30*5*30)*52 128700
TOTAL UTILITIES Insert total amount here -> $ 1,036,200.00
Administration Management Staff Wages 25000*52 1430000
Security and maintance 10000*50 550000
Office Supplies 3000*52 171600
Building Rent 7500*52 188760
TOTAL UTILITIES Insert total amount here -> $ 2,340,360.00
Depreciation Depreciation 2200000*20% $ 440,000.00
TOTAL DEPRECIATION Insert total amount here -> $ 440,000.00
In the contingency plan the cost of providing service are considered to increase by
10%. Moreover, the investment in the surgical instrument increased by the same quantum. As
the result, if the same price is maintained then it will make loss (Penner, 2013).

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Income
Explanatory Notes Category Product/Service Formula Calculation Explanatory Notes
This cost holds the consultancy Income Consultancy 1*35*5*52*3500 31850000
Surgery 1*30*5*52*7500 58500000
Medicine 15*40*7*52*2282 498388800
TOTAL INCOME . $ 588,738,800.00
Break Even Calculation
TOTAL INCOME $ 588,738,800.00
minus TOTAL COSTS PER YEAR $ 647,381,064.00
Profit / Loss -58642264
If the Profit/Loss row is NEGATIVE, your service is LOSING MONEY. Increase your income.

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Reference
Penner, S. J. (2013). Economic and financial management for nurses and nurse leaders. (2nd
Ed). NY:Springer Publishing. Chapter 8: Cost finding, breakeven and charges p. 168
onwards.
Zelman, W.N. (2014). Financial management of health care organisations. (4th Ed). Online in
UWSLibrary. Chapter 9: Using cost information to make special decisions, p. 375
onwards.