Prepare an annual operating budget (do not include revenue) for a Medical Transcription Unit that is a part of the Health Information Department under the direction of a Health Information Manager.

Use the Operating Budget spreadsheet (under this Budget assignment folder) as a template for your budget - be sure to include the following:

Salary and Benefits

Travel

New Equipment

Supplies

Staff Development

Service Contracts

Dues/Memberships

Any other components you deem necessary based on the information you are given

Note: All equipment purchases and increases in personnel must be accompanied by a justification proposal.

Read the Facts below. Complete all Assignments listed (they are included within the Facts below) while you prepare the operating budget.

FACTS

This is a 150 bed hospital in Central Kansas (45 miles to Wichita, Kansas) with 6600 discharges per year and 15,600 xray procedures per year.

Employees include one transcription supervisor, three transcriptionists (FTE), and one part-time transcriptionist who covers the weekend shift. Currently, they provide service for physicians by completing their transcription on discharge summaries, history and physical exams, operative reports, and consultation reports for sixty active physicians. Also, ten of those physicians dictate their progress notes. On average, each physician dictates 273 two page reports each per year; mailed four reports at a time.

Hours: 7 a.m. to 8 p.m. Monday through Friday; 10 a.m. to 3 p.m. Saturday and Sunday

Current Productivity:

Position	# pages typed	Daily	Weekly
Supervisor	5 pages/hr	20	100
Transcriptionist #1	5 pages/hr	40	200
Transcriptionist #2	4 pages/hr	32	160
Transcriptionist #3	3 pages/hr	24	120
Transcriptionist #4	5 pages/hr	25	50
Total		141	630

In August this year, the supervisor will assume responsibility for the transcription of radiology reports. The full time radiology transcriptionist is leaving on September 1st (she currently works 8 hours per day and transcribes approximately 5 one-page reports per hour) and the hospital administrator wants you to absorb her work. There is also a .5 radiology transcriptionist who also transcribes 5 one-page reports per hour. The total annual reports for both transcriptionists = 15,600.

Assignment #1:

In one paragraph convince your administrator that the radiology transcriptionist must be replaced. You would like to hire a replacement at an entry level of $12.00 per hour. You will submit this paragraph in one submission with the operating budget.

Salary: Annual based on 2080 hours for FTE - does not include weekend differential for Transcriptionist #4.

Position	Salary
Supervisor	20.00/hr
Transcriptionist #1	15.00/hr
Transcriptionist #2	13.00/hr
Transcriptionist #3	12.00/hr
Transcriptionist #4 (PT weekend)	10.00/hr
Radiology Transcriptionist (FT)	13.00/hr
Radiology Transcriptionist (PT)	10.00/hr

Consider: Supervisor will receive a 3% raise in June; the other transcriptionists (medical and radiology) will receive a 2% raise in June. Also, consider if you want to upgrade the salaries of your transcriptionists to be equal to the radiology transcriptionists (who have less seniority, education, and experience) but remember to justify this in your work.

Also, the weekend differential for transcriptionist #4 is 1.00/hr.

Use 2080 as the number of hours for full time employees.

For this assignment compute the number of hours times the hourly wage, round up to the nearest dollar amount and divide by 12 for a monthly total. You may adjust in May if need be but be sure the correct yearly salary is in the Total column.

Assignment #2:

If you choose to upgrade the salaries of your transcriptionists (you will receive extra points if you do this) then you must justify this. Write one paragraph convincing your administrator that the transcriptionists salaries must be upgraded to be equal to the radiology transcriptionists. Submit this Assignment in one submission with the operating budget and other Assignments.

Benefits:

Benefit	Amount Paid
FICA	12% of salary/employee/month
Life Insurance	$5.00/employee/month
Medical Insurance	$150.00/employee/month
Dental Insurance	$50.00/employee/month
Retirement Contribution	$50.00/employee/month
Worker's Compensation	$50.00/employee/month

Compute the figures for the benefits for all employees and place in that section of the budget form.

Service Contracts and Supplies:

PCs and Printers Maintenance Program - $500/year/for each computer and printers payable in August each year. All transcriptionists (health information and radiology) and the supervisor have their own PC. There are two printers in the department. Put this in the service contracts.

Printer Supplies - $500.00/each printer/year. There are two printers in the department (Purchase in September) - put this in supplies.

Dictaphone/Dictation Equipment - You want to purchase these in June (List in supplies):

Need to replace two hand-held recorders (estimated at $150 each)

Need to purchase one transcribing unit (approximately $500)

Need to replace 3 earplugs ($15.00 each)

Maintenance agreement on dictation monitoring equipment, dictating units and transcription units - Total $3500 per year payable in equal installments in June and January each year - these should be listed under Service Contracts.

Paper Costs - $5.00 per ream of paper (500 pages per ream) - list in supplies. Compute this cost based on the number of pages transcribed (round up to the highest thousand) - these are purchased (1/2 at a time) in bulk in October and April.

Transcription Company - Currently, your transcription department is able to handle the transcription load except during four weeks in June and July when work is sent out to a transcription company in Wichita. They have a service contract with this company. The company charges them .15/line (40 lines per page) and the company usually transcribes 640 pages for them during this time frame. This is due in July. The health information section of the department handles all copying of reports so you do not have to include it in this budget.

Other Expenses:

Dues/Memberships (All due in January):

Supervisor is an RHIT - full active AHIMA member with dues paid by hospital ($175)

Transcriptionist #1 is an RHIT - active AHIMA member - hospital pays 75% of dues

Transcriptionist #2 is a CMT and is an active member of the Association for Healthcare Documentation Integrity (AHDI) - hospital pays 75% of dues ($50/year)

Hospital also maintains an institutional membership with AHDI ($125/year)

The part time radiology transcriptionist is interested in joining AHDI also

Education/Training and Travel/Mileage:

(Put registration fee in Education/Training and other expenses in Travel/Mileage)

The medical transcriptionists attend quarterly meetings (February, May, August and November) traveling to Wichita each time. The supervisor does not attend these meetings. The hospital pays 55 cents per mile for one person to drive everyone going to the meeting. The radiology transcriptionists have never gone before but have expressed an interest in attending these quarterly meetings. Registration fee for the quarterly meetings is $50.00. Because you now have more people attending the meeting, you should schedule them to drive in two cars.

The supervisor would like to attend the AHIMA annual meeting in another state in October. Registration = $550. Estimated cost from the hospital travel agent is $400 for a round trip ticket to the meeting - from Wichita to the meeting site. Hotel cost is $200 per night for four nights. She is sharing the room with her sister who is an RHIT from Nebraska so the hospital will pay half. Travel to and from the airport in Wichita is reimbursed by the hospital at .55/mile, and travel to and from the airport in the meeting city is on a shuttle bus estimated to be $40 round trip. The hospital has a cap of $20/day for meals.

The supervisor and transcriptionist #1 also attend one state HIMA meeting each. One goes in September and one in April. Registration fee = $120/each. Estimated expenses to the meeting in September include 216 miles round trip, and the meeting in April is 432 miles round trip, two nights each in a hotel (the hospital will only pay half), plus meals. You estimate the cost of a hotel room in each town. Hospital pays the same mileage and meals as listed above for the annual meeting.

Uniforms (Payable in the first month of the fiscal year):

The hospital does provide a uniform benefit for employees who wish to wear them ($20/month) and currently the radiology transcriptionists wear the shirts and slacks provided by the uniform company. Your employees have expressed an interest in wearing uniforms, so budget it in. Note: The supervisor does not wish to wear a uniform.

Assignment #3:

Write a memo to the HIM department director informing them of your employees decision to wear uniforms and you will include it in your budget. Submit this Assignment in one submission with the operating budget and other Assignments.

Subscription/Books (Payable in February except for the dictionary):

Note: New PDR $200; Dictionaries $100/each

The radiology transcriptionists have to share dictionaries. Because of this, you decide to purchase another one so they each have their own when you take over the area in August. Each transcriptionist (including the radiology transcriptionists) and supervisor receives a new PDR each year in February and you need to purchase 3 more new dictionaries in February.

Postage (estimated for each month):

You mail copies of reports to physicians (all reports are mailed because the physicians never pick up their mail from the physician's lounge) so estimate the cost of mailing reports each month (keep in mind the price of the current postage stamp!) to the physicians. You mail 6 sheets of paper in each envelope for the radiology reports and 8 sheets of paper for the rest of the medical staff. The HIM Department supplies the envelopes, so you don't have to budget that. Remember, you don't take over the radiology reports until August.

On the average, each physician dictates 273 two page reports each per year; mailed four reports at a time. Copies of radiology reports are also mailed to physicians (estimated at 260 reports per physician mailed six reports at a time).

Assignment #4:

Use the Operating Budget spreadsheet (under this Budget assignment folder) as a template for your budget - complete the spreadsheet based on the facts provided.