Business Plan Part 2 Financial Analysis and Budget

docx

School

Grand Canyon University *

*We aren’t endorsed by this school

Course

470

Subject

Finance

Date

Jan 9, 2024

Type

docx

Pages

Uploaded by cgonzalesh

Quail Run Behavioral Financial Analysis and Budget Celia Gonzales-Hardy Grand Canyon University HCA-470: Strategic Planning and Implementation in Health Care Professor Leslie Minjarez December 4, 2023 1

Strategic Initiative Quail Run's proposed strategic initiative aims to build upon its strengths, address weaknesses, capitalize on opportunities, and mitigate threats identified in a comprehensive SWOT analysis. The organization, known for its highly skilled treatment team and patient- centered approach, seeks to enhance patient care, ensure financial sustainability, increase its reach, and improve staff retention. A key aspect of the proposed changes involves the diversification of services. Quail Run recognizes the need to go beyond its current offerings, leveraging the expertise of its treatment team to explore innovative treatments and potentially expand into related healthcare services. This strategic move aligns with the organization's holistic treatment philosophy and can lead to more comprehensive and effective patient care. The emphasis on a diverse treatment team, including psychiatrists, psychologists, social workers, nurses, behavioral health specialists, and recreation therapists, positions Quail Run to provide a wide range of services under one roof. Financial planning is another critical element of the proposed initiative. The organization acknowledges the ambitious nature of its goals related to program development and expansion. To ensure the realization of these goals, Quail Run aims to develop a robust financial plan. This plan will address potential financial constraints, allowing the organization to invest in the resources necessary for growth while maintaining a focus on delivering high-quality care. Geographical expansion is also on the agenda. Quail Run recognizes that its current services might be limited by a confined geographical reach. To overcome this limitation, the organization is considering the adoption of telehealth options and the establishment of satellite facilities. This move aligns with the evolving landscape of healthcare delivery, providing opportunities to reach a broader demographic and meet the changing needs of the community. 2

Acknowledging the demanding nature of behavioral health work, Quail Run is committed to implementing staff well-being initiatives. The organization recognizes the risk of staff burnout and aims to proactively address this challenge. Mental health support and work-life balance initiatives are proposed to ensure the physical and mental well-being of the treatment team. This not only contributes to staff satisfaction but also ensures a stable and skilled workforce, crucial for maintaining the high standards of care that Quail Run is known for. Quail Run's strategic initiative is a holistic approach that considers its internal strengths and weaknesses as well as external opportunities and threats. By diversifying services, ensuring financial sustainability, expanding its reach, and prioritizing staff well-being, Quail Run aims to position itself for continued success in the competitive behavioral health landscape while staying adaptable to regulatory changes and economic uncertainties. The organization's commitment to a patient-centered approach and a comprehensive treatment team reinforces its mission to provide supportive, compassionate, and innovative care. Budget Creating a budget for a strategic initiative involves careful consideration of various factors, including staffing, space, equipment, training, and other related expenses. Below is a simple budget outline with relevant categories for your behavioral health care services strategic initiative. Behavioral Health Care Services Strategic Initiative Budget Table: Summary of Operations (in thousands) Category 2022 Amount ($) 2021 Amount ($) % of Net Revenues Net Revenues $5,595,179 $5,371,512 100.0% Operating Expenses - Salaries, Wages, $3,075,718 $2,863,708 55.0% 3

Your preview ends here

Eager to read complete document? Join bartleby learn and gain access to the full version

Access to all documents
Unlimited textbook solutions
24/7 expert homework help

Category 2022 Amount ($) 2021 Amount ($) % of Net Revenues Benefits - Other Operating Expenses $1,071,443 $1,036,089 19.1% - Supplies Expense $210,136 $202,816 3.8% - Depreciation and Amortization $180,958 $183,843 3.2% - Lease and Rental Expense $42,657 $40,438 0.8% Total Operating Expenses $4,580,912 $4,326,894 81.9% Income from Operations $1,014,267 $1,044,618 18.1% Interest Expense, Net $3,749 $3,312 0.1% Other (Income) Expense, Net ($6,343) $96 -0.1% Income Before Income Taxes $1,016,861 $1,041,210 18.2% Key Observations: Revenue Growth: Net revenues increased by $224 million (4.2%) in 2022 compared to 2021. Expenses: Salaries, wages, and benefits increased by $212 million (7.4%) due to a nationwide shortage of clinical staff. Initiative Focus: Consider allocating funds to address the staffing shortage, training programs, and other initiatives to enhance operational efficiency. Future Predictions: Monitor changes in healthcare policies and reimbursement rates, as they may impact future revenues. COVID-19 Impact: Assess the ongoing effects of the pandemic on operating costs and patient care. Recommendations: Staffing: Allocate funds for recruiting and retaining skilled staff, considering the current shortage. Explore incentives to attract and retain essential workers. 4

Training and Education: Develop training programs to address the specific needs arising from the nationwide shortage, focusing on enhancing the skills of existing staff. Infrastructure: Invest in technology and equipment to improve efficiency and patient care. Policy Monitoring: Stay informed about healthcare policy changes that may affect reimbursement rates and overall financial stability. COVID-19 Preparedness: Allocate resources to adapt to ongoing challenges posed by the pandemic, including clinical staffing shortages. This budget provides a foundation for managing the strategic initiative, with a focus on addressing current challenges and preparing for future uncertainties. Regularly review and adjust the budget based on the evolving landscape of the healthcare industry and specific needs of your behavioral health care services. Financial Data Overview In formulating the budget for the strategic initiative in behavioral health care services, a thorough examination of financial data was undertaken, with a focus on key statements such as the income statement and balance sheet. These analyses aimed to glean insights into the financial health of the organization, identify potential areas for improvement, and address challenges within the behavioral health care sector. The net revenue figure of $5,595,179 thousand for the year ending December 31, 2022, played a pivotal role as the starting point for budget considerations. This metric, reflecting the total revenue after deducting allowances, showed a positive growth trend of 4.2% from the previous year, providing a solid foundation for the budget. A substantial portion of operating expenses, accounting for 55.0% ($3,075,718 thousand) of net revenues, was allocated to salaries, wages, and benefits. The 7.4% increase from the prior 5

year underscored the importance of human resources in delivering behavioral health care services. Strategic investments in staffing, including recruitment, training, and retention programs, were identified as essential to address staffing challenges and ensure quality patient care. Other operating expenses, representing 19.1% ($1,071,443 thousand) of net revenues, encompassed various operational costs. The 3.4% increase from the previous year signaled potential areas for cost optimization and efficiency improvements. Detailed scrutiny of these expenses, including administrative costs, facility maintenance, and technology investments, guided resource allocation decisions for enhanced operational effectiveness. The income from operations, standing at $1,014,267 thousand, indicated the organization's ability to generate profit after covering operating expenses. Despite challenges in staffing and other operational areas, the 18.1% margin suggested a financially stable position. This figure guided decisions on allocating surplus funds to strategic initiatives, such as technology upgrades, staff training, and infrastructure improvements. While not explicitly provided in the data, a review of the balance sheet would be essential for understanding the organization's overall financial position. Assets, liabilities, and equity components would inform decisions related to capital investments, debt management, and financial sustainability. Moreover, a consideration of the impact of the COVID-19 pandemic on financial performance, including increased expenses related to the clinical staffing shortage and pandemic- related regulations, influenced budgetary considerations. The financial data overview served as a foundational element for informed budgeting decisions. The analysis of net revenues, operating expenses, income from operations, and other 6

Your preview ends here

Eager to read complete document? Join bartleby learn and gain access to the full version

Access to all documents
Unlimited textbook solutions
24/7 expert homework help

pertinent financial metrics provided insights into the organization's fiscal health, facilitating strategic planning to address challenges and capitalize on growth opportunities within the behavioral health care sector. This approach ensures that the budget aligns with the organization's financial objectives, supports operational excellence, and positions the organization for sustained success. Financial Statements ( www.ahd.com.2023 ) 7

References Annual reports . Universal Health Services Inc. (2022). https://uhsinc.gcs-web.com/financial- information/annual-reports https://www.indeed.com/cmp/Quail-Run-Behavioral-Health/about#:~:text=Patients%20are %20our%20top%20priority,of%20those%20in%20our%20care.&text=Uncompromised %20standards:%20We%20are%20dedicated,of%20quality%2C%20talent%20and %20ethics.&text=Community%20investment:%20We%20are%20committed,of%20the %20communities%20we%20serve. https://quailrunbehavioral.com/ Moseley III, G. B. (2018). Managing health care business strategy (2nd ed.). Jones and Bartlett Learning. ISBN-13: 9781284081107 Quail Run Behavioral Health . ahd.com - American Hospital Directory. (2023, October 2). https://www.ahd.com/free_profile/034031/Quail_Run_Behavioral_Health/Phoenix/Arizona / 8