1. A completed Personnel Budget (Table 6-33)
   • Follow the instructions on page 353 to calculate the new salary for each position. Ensure the raise that goes into effect in October is factored into the salaries. Since the fiscal year starts on July 1st, the raise itself would not be applied across the entire year, only from October - June.
   • Fringe benefits and overtime should be included at the bottom of the table, as indicated in the book.
2. A completed Operational Budget (Table 6-34)
   • Most of this is already provided. You will need to total the expenses so they can be allocated appropriately across the months in your comprehensive budget next week.
3. A completed Capital Equipment Budget (Table 6-35)
   • The line item stating "Depreciation over five years" should actually only include ONE year of depreciation to show how much it will depreciate each year over the next five years.
   • Use the straight line depreciation method and assume a depreciation time of five years.

My suggestion for formatting would be to create an Excel spreadsheet with separate tabs for each requirement.

***Be sure to show ALL formulas within Excel***

CASE STUDIES IN HEALTH INFORMATION MANAGEMENT CASE 6-27 Developing the Health Information Management Department Budget op a budget for the HIM department for the sea Crest Healthcare Center, The FY begns bily 1. U n der soll were to deving the butts and the develco the department the next Fy There are three parts to the budget as follows: Personnel (see Table 6-331 Operational Isee Table 6-34] Capital equipment (see Table 6-35. Figure 6-3, and Figure 6-4 1. Calculate the budget for each month and a total for the ver Line tems to be included are identified in each of the three parts of the budget. Any tim tationslindructions from administration are also provided. 2. Use the capital expenditure approval form figure 6-4 in completing and submitting a capital expenditure request for a new dictation system. Personnel Budget The FY personnel budget is indicated in Table 6-36. Remember that the salary raises will not go into effect until October of the FY. Instructions: Limitations: Calculate fringe benefits as 25% of monthly salary, A5% raise will go into effect in October Overtime cannot exceed $4,000.00 for the year. No new employees. Use a spreadsheet to calculate and reflect the monthly personnel budget. - LEADERSHIP O W i ntermation for Salary Budget 20XX-20XX Salary Position Director Assistant director Receptionist/clerk Analyst/coder/abstractor Analyst/coder/abstractor HIM clerk Transcriptionist Transcriptionist Part-time HIM clerk Personnel Budget Current Salary $82,000.00 $74,000.00 $31.000.00 $46,000.00 $48,500.00 $30,000.00 $45,000.00 $47.000.00 $16.500.00 Line items total salaries Total salaries and fringe benefits Overtime TABLE 1-1 Operational Budget Operational Budget Operation Budgeted Telephone $2,000.00 Supplies $1,050.00 Scanner $10,000.00 Equipment Copy machine Education $22,000.00 $5,000.00 $5,000.00 TOTAL CASE STUDIES IN HEALTH INFORMATION MANAGEMENT o Capital Equipment Budget Instructions: Complete the HIM de department's capital equipment budget for the Note: The only major equipment request is to replace your current dictation Administration has distributed budget requests to each departmen Ing a due date of one month sach department at General Hospital with a memo indicat- Instructions state that the capital budoet is er based, requiring 14 expenditures. You have listed some justifications for a new digit Figure 6-3. You need to complete the capital expenditure approval forms administration with your budget. Based," requiring justification of any proposed capital acons for a new digital dictation system for the upcoming year in cure approval form shown in Figure 6-4 and return it to As the HIM director, you know that after administration's review of subm foreseen as most important will be approved and funded. For your capital budget as if it had been approved. nistration's review of submitted department budgets, only those be approved and funded. For this exercise, include the dictation system in TABLE 6-35 Capital Equipment Information Capital Equipment Item: New Dictation System Cost for system $ 65,000.00 Annual income produced $20,000.00 Depreciation over five years 356 Section 6 LEADERSHIP JUSTIFICATION FOR NEW TRANSCRIPTION SYSTEM couple of times per month The current dictation system is 15 years old. It requires service a couple of times per me The downtime of the system averages 50 minutes each time the serviceman comes out to serve The medical staff has complained of not being able to access the system due to getting buty sian Dr. Delinco complains that his operative reports are taking 1 to 1 weeks to be typed. Dr. Smith has complained that the current system does not allow him to call in and listen dictations as an alternative when the report is not available on the patient chart. Prioritizing reports among the transcriptionists is not as automated as newer systems allow, there consuming transcribers' time and impacting production FIGURE Justification for New Transcription System CAPITAL EXPENDITURE APPROVAL FORM Description: Budget Year: Type of Expenditure: Replacement: Briefly define function of capital expenditure: Budget Cost: $ New: Briefly describe why item is needed: Justification for new transcription system is attached Isee Figure 6-31 FIGURE 4 Capital Expenditure Approval Form CASE STUDIES IN HEALTH INFORMATION MANAGEMENT 357 Financial Analysis Annual Al Gross Revenue B) Less Depreciation C) Gross Profit D) Asset Cost E) Return on Asset F) Payback Years Requested by: (Department Manager] Approved by: Date (Operations Manager [Finance Manager) Date [Administrator) Date FIGURE 4 Capital Expenditure Approval Form (continued CASE STUDIES IN HEALTH INFORMATION MANAGEMENT CASE 6-27 Developing the Health Information Management Department Budget op a budget for the HIM department for the sea Crest Healthcare Center, The FY begns bily 1. U n der soll were to deving the butts and the develco the department the next Fy There are three parts to the budget as follows: Personnel (see Table 6-331 Operational Isee Table 6-34] Capital equipment (see Table 6-35. Figure 6-3, and Figure 6-4 1. Calculate the budget for each month and a total for the ver Line tems to be included are identified in each of the three parts of the budget. Any tim tationslindructions from administration are also provided. 2. Use the capital expenditure approval form figure 6-4 in completing and submitting a capital expenditure request for a new dictation system. Personnel Budget The FY personnel budget is indicated in Table 6-36. Remember that the salary raises will not go into effect until October of the FY. Instructions: Limitations: Calculate fringe benefits as 25% of monthly salary, A5% raise will go into effect in October Overtime cannot exceed $4,000.00 for the year. No new employees. Use a spreadsheet to calculate and reflect the monthly personnel budget. - LEADERSHIP O W i ntermation for Salary Budget 20XX-20XX Salary Position Director Assistant director Receptionist/clerk Analyst/coder/abstractor Analyst/coder/abstractor HIM clerk Transcriptionist Transcriptionist Part-time HIM clerk Personnel Budget Current Salary $82,000.00 $74,000.00 $31.000.00 $46,000.00 $48,500.00 $30,000.00 $45,000.00 $47.000.00 $16.500.00 Line items total salaries Total salaries and fringe benefits Overtime TABLE 1-1 Operational Budget Operational Budget Operation Budgeted Telephone $2,000.00 Supplies $1,050.00 Scanner $10,000.00 Equipment Copy machine Education $22,000.00 $5,000.00 $5,000.00 TOTAL CASE STUDIES IN HEALTH INFORMATION MANAGEMENT o Capital Equipment Budget Instructions: Complete the HIM de department's capital equipment budget for the Note: The only major equipment request is to replace your current dictation Administration has distributed budget requests to each departmen Ing a due date of one month sach department at General Hospital with a memo indicat- Instructions state that the capital budoet is er based, requiring 14 expenditures. You have listed some justifications for a new digit Figure 6-3. You need to complete the capital expenditure approval forms administration with your budget. Based," requiring justification of any proposed capital acons for a new digital dictation system for the upcoming year in cure approval form shown in Figure 6-4 and return it to As the HIM director, you know that after administration's review of subm foreseen as most important will be approved and funded. For your capital budget as if it had been approved. nistration's review of submitted department budgets, only those be approved and funded. For this exercise, include the dictation system in TABLE 6-35 Capital Equipment Information Capital Equipment Item: New Dictation System Cost for system $ 65,000.00 Annual income produced $20,000.00 Depreciation over five years 356 Section 6 LEADERSHIP JUSTIFICATION FOR NEW TRANSCRIPTION SYSTEM couple of times per month The current dictation system is 15 years old. It requires service a couple of times per me The downtime of the system averages 50 minutes each time the serviceman comes out to serve The medical staff has complained of not being able to access the system due to getting buty sian Dr. Delinco complains that his operative reports are taking 1 to 1 weeks to be typed. Dr. Smith has complained that the current system does not allow him to call in and listen dictations as an alternative when the report is not available on the patient chart. Prioritizing reports among the transcriptionists is not as automated as newer systems allow, there consuming transcribers' time and impacting production FIGURE Justification for New Transcription System CAPITAL EXPENDITURE APPROVAL FORM Description: Budget Year: Type of Expenditure: Replacement: Briefly define function of capital expenditure: Budget Cost: $ New: Briefly describe why item is needed: Justification for new transcription system is attached Isee Figure 6-31 FIGURE 4 Capital Expenditure Approval Form CASE STUDIES IN HEALTH INFORMATION MANAGEMENT 357 Financial Analysis Annual Al Gross Revenue B) Less Depreciation C) Gross Profit D) Asset Cost E) Return on Asset F) Payback Years Requested by: (Department Manager] Approved by: Date (Operations Manager [Finance Manager) Date [Administrator) Date FIGURE 4 Capital Expenditure Approval Form (continued