Pfch Email Record From Davis Geach Emailprotected To ✓ Solved
PFCH Email Record From: Davis Geach < [email protected] > To: Zachary Hardie Subject: Increase in nursing staff Zach: Caterina has been insisting for some time that we need to hire more nurses. I’ve arranged for her to give a presentation to the Board next month to plead her case. I know that following her presentation, they will want me to advise them of any alternatives. Caterina’s argument is that the nurses are over-worked and that has a negative effect on patient care and also leads to the nurses leaving PFCH for other hospitals. I’m wondering whether giving the nurses a raise might solve the problems.
Please put together some numbers to compare hiring more nurses versus giving the nurses a raise. Davis Geach, President/CEO Please consider the environment before printing this email. This message is private and confidential. If you have received it in error, please contact the sender immediately and delete it from your system. PFCH Email Record From: Zachary Hardie < [email protected] > To: Caterina Hossack Subject: Re: Increase in nursing staff Hi Caterina.
Mr. Geach asked me to prepare some information for the Board of Directors relating to your proposal to add more nurses to the hospital staff. In order to do this, I need to know the current nursing ratio and what nursing ratio you are proposing. Thanks for your help. Zachary Hardie, Chief Financial Officer Please consider the environment before printing this email.
This message is private and confidential. If you have received it in error, please contact the sender immediately and delete it from your system. PFCH Email Record From: Caterina Hossack < [email protected] > To: Zachary Hardie Subject: Re: Increase in nursing staff The hospital currently maintains a 5 to 1 nursing ratio (5 patients for every nurse). I will suggest to the Board of Directors that we move to a 4 to 1 nursing ratio (4 patients per nurse). Will the information that you are preparing address patient care, worker satisfaction and nursing turnover?
Caterina Hossack, Chief Nursing Officer Please consider the environment before printing this email. This message is private and confidential. If you have received it in error, please contact the sender immediately and delete it from your system. PATTON – FULLER COMMUNITY HOSPITAL From: Zachary Hardie, CFO To: Davis Geach, President/CEO Re: Increase in nursing staff Per your request, I have prepared a financial analysis comparing the increasing of the nursing staff to the granting of an across the board raise to the existing nursing staff. In order to have a common basis for the comparison, it was necessary to take our existing salary and benefit costs for the nursing staff and show how they related to the existing patient/nurse ratio.
I have attached as an exhibit a table that presents our current patient statistics. While the hospital has a capacity of 600 beds, we generally have only 60% of the beds occupied. The occupancy of the hospital is also affected by well-established seasonal fluctuations. Using the average occupancy and the expected seasonal fluctuations, we try to anticipate our daily and monthly patient loads and match our staffing needs accordingly. The attached table sets forth that modeling and shows how changes in the daily and monthly patient census affect our patient revenues.
Also attached is a second table that deals with our nursing statistics. Using the expected number of patients per day from the first table, it sets out how many nurses would be required to serve the patients ,based on our existing 5 to 1 nursing ratio, and then what the cost of those nurses is based on the existing average salary and benefits of the nurses, expressed as an hourly wage of per hour. The table then sets forth how the nursing costs would be changed by either giving the nurses a
per hour raise or by changing the hospital’s nursing ration to 4 to 1 (4 patients for every nurse). If you need any additonal information, please let me know. Jan Feb Mar Apr May Jun Days in the month Patient Days (60% occ x seasonal x days in month) 13,271 11,983 12,286 10,171 9,092 7,258 Average Census: Patton Fuller # of beds= 600 Patton Fuller avg occupancy (HFMA) 60% Patton Fuller Avg Daily Census (ADC) 360 Month as % of Average "Seasonal Adjustment" 119% 119% 110% 94% 81% 67% Patton Fuller Avg Daily Census w/seasonal adj.Patton Fuller Avg Net Rev/pt day $ 3,500 Average Daily Revenue 1,498,381 1,497,857 1,387,134 1,186,616 1,026,,801 Patton Fuller Avg Net Rev/month (1000's) $ 46,450 $ 41,940 $ 43,001 $ 35,598 $ 31,821 $ 25,404 Patton - Fuller Community Hospital Patient Statistics C:\Documents and Settings\mkriorda\My Documents\Web Development\CIST Server\CIST\VOP Development\Healthcare\PFCH\HosDepts\CFO09 Financial Statements09PatientStatsPDF.xls Jul Aug Sep Oct Nov Dec Total Days in the month Patient Days (60% occ x seasonal x days in month) 7,294 10,723 11,182 11,607 13,419 13,,400 Average Census: Patton Fuller # of beds= 600 Patton Fuller avg occupancy (HFMA) 60% Patton Fuller Avg Daily Census (ADC) 360 Month as % of Average "Seasonal Adjustment" 65% 96% 104% 104% 124% 117% 100% Patton Fuller Avg Daily Census w/seasonal adj.
Patton Fuller Avg Net Rev/pt day $ 3,500 Average Daily Revenue 823,560 1,210,686 1,304,520 1,310,523 1,565,592 1,480,451 Patton Fuller Avg Net Rev/month (1000's) $ 25,530 $ 37,531 $ 39,136 $ 40,626 $ 46,968 $ 45,894 $ 459,900 Patton - Fuller Community Hospital Patient Statistics C:\Documents and Settings\mkriorda\My Documents\Web Development\CIST Server\CIST\VOP Development\Healthcare\PFCH\HosDepts\CFO09 Financial Statements09PatientStatsPDF.xls Jan Feb Mar Apr May Jun Number of Patients per day Cost of nurse per hour w/benefits 30.00$ 30.00$ 30.00$ 30.00$ 30.00$ 30.00$ Cost of nurse per 24hour day 720.00$ 720.00$ 720.00$ 720.00$ 720.00$ 720.00$ Number of nurses per patient based on 5 patients per nurse or a "5 to 1" nursing ratio 0.2 Number of nurses per day 85.6 85.6 79.3 67.8 58.7 48.4 Nursing cost per day 61,648$ 61,626$ 57,071$ 48,821$ 42,233$ 34,840$ Nursing cost per month 1,911,078$ 1,725,532$ 1,769,190$ 1,464,623$ 1,309,221$ 1,045,194$ Simulation: Effect of a
per hour raise for all nurses Cost of nurse per hour w/benefits 31.00$ 31.00$ 31.00$ 31.00$ 31.00$ 31.00$ 744.00$ 744.00$ 744.00$ 744.00$ 744.00$ 744.00$ Number of nurses per patient based on a ratio of 5 patients per nurse or a "5 to 1" nursing ratio 0.2 Number of nurses per day 85.6 85.6 79.3 67.8 58.7 48.4 Nursing cost per day 63,703$ 63,680$ 58,973$ 50,448$ 43,641$ 36,001$ Nursing cost per month 1,974,781$ 1,783,050$ 1,828,163$ 1,513,444$ 1,352,862$ 1,080,034$ Increase in cost per month due to a raise per nursing hour 63,702.62$ 57,517.73$ 58,973.00$ 48,820.77$ 43,640.71$ 34,839.80$ Simulation: Effect of changing to a "4 to 1" nursing ratio Number of nurses per day 0.25 107.0 107.0 99.1 84.8 73.3 60.5 Nursing cost per day (Nursing ratio of "4 to 1" and an hourly rate of $,060$ 77,033$ 71,338$ 61,026$ 52,791$ 43,550$ Nursing cost per month 2,388,848$ 2,156,915$ 2,211,487$ 1,830,779$ 1,636,527$ 1,306,493$ Increase in cost per month due to a change in nursing ratio from 5 to 1 down to 4 to 1 477,770$ 431,383$ 442,297$ 366,156$ 327,305$ 261,299$ Nursing Statistics Patton - Fuller Community Hospital C:\Documents and Settings\mkriorda\My Documents\Web Development\CIST Server\CIST\VOP Development\Healthcare\PFCH\HosDepts\CFO09 Financial Statements09NursingStatsPDF.xls Jul Aug Sep Oct Nov Dec Total Number of Patients per day Cost of nurse per hour w/benefits 30.00$ 30.00$ 30.00$ 30.00$ 30.00$ 30.00$ Cost of nurse per 24hour day 720.00$ 720.00$ 720.00$ 720.00$ 720.00$ 720.00$ Number of nurses per patient based on 5 patients per nurse or a "5 to 1" nursing ratio 0.2 Number of nurses per day 47.1 69.2 74.5 74.9 89.5 84.6 Nursing cost per day 33,884 49,811 53,672 53,919 64,413 60,910 Nursing cost per month 1,050,392 1,544,143 1,610,150 1,671,479 1,932,388 1,888,210 Simulation: Effect of a per hour raise for all nurses Cost of nurse per hour w/benefits 31.00$ 31.00$ 31.00$ 31.00$ 31.00$ 31.00$ 744.00$ 744.00$ 744.00$ 744.00$ 744.00$ 744.00$ Number of nurses per patient based on a ratio of 5 patients per nurse or a "5 to 1" nursing ratio 0.2 Number of nurses per day 47.1 69.2 74.5 74.9 89.5 84.6 Nursing cost per day 35,013$ 51,471$ 55,461$ 55,716$ 66,560$ 62,940$ Nursing cost per month 1,085,405$ 1,595,615$ 1,663,822$ 1,727,195$ 1,996,801$ 1,951,150$ Increase in cost per month due to a raise per nursing hour 35,013.05$ 51,471.44$ 53,671.66$ 55,715.97$ 64,412.93$ 62,940.33$ $ 630,720.01 Simulation: Effect of changing to a "4 to 1" nursing ratio Number of nurses per day 0.25 58.8 86.5 93.2 93.6 111.8 105.7 Nursing cost per day (Nursing ratio of "4 to 1" and an hourly rate of $,354$ 62,264$ 67,090$ 67,398$ 80,516$ 76,137$ Nursing cost per month 1,312,989$ 1,930,179$ 2,012,687$ 2,089,349$ 2,415,485$ 2,360,262$ Increase in cost per month due to a change in nursing ratio from 5 to 1 down to 4 to 1 262,598$ 386,036$ 402,537$ 417,870$ 483,097$ 472,052$ 4,730,400$ Patton - Fuller Community Hospital Nursing Statistics C:\Documents and Settings\mkriorda\My Documents\Web Development\CIST Server\CIST\VOP Development\Healthcare\PFCH\HosDepts\CFO09 Financial Statements09NursingStatsPDF.xls NursingOptFolder NursingMemo1 NursingMemo2 NursingMemo3 NursingMemo4docx 2009PatientStatsPDF 2009NursingStatsPDF 2010 Operating Budget Projection HCS/577 Version University of Phoenix Material Patton-Fuller Community Hospital Statement of Revenue and Expense 2009 to 2010 Operating Budget Complete the Operating Budget.Assume the 2009 projections were realized. Use the 2009 budget and the 2010 budget assumptions to calculate expenses and income for 2010. The revenues have been completed for you. 2009 (Proj) 2010 Budgeted % Change From 2009 Projection 2010 Budget 2010 Operating Budget Assumptions Revenue Based on these 2009 assumptions: a 3% overall deflation rate for prices in 2009—due to the weak economy—will continue into 2010. Net patient revenue 459,% 473,697 Patient revenue will continue to increase, but at a decreased rate, with little or no increase in patient volume, due to new managed care contracts.
Other revenue 3,% 3,544 Marketing's plan to increase donations by 15% Total revenue 462,% 477, (Proj) 2010 Budgeted % Change From 2009 Projection 2010 Budget 2010 Operating Budget Assumptions Expenses Salaries and benefits 220,% 222,959 Salaries will hold to a 1% overall increase in cost due to price deflation nationwide, with no increase in labor hours, due to no increase in patient volume. This assumption could be affected by a board decision either to raise nursing wages by
per hour or to increase the nursing hour ratio. Supplies 74,% 72,347 Supplies cost will decrease 3% due to the price deflation and our current over-stock purchased last year. Physician and professional fees 110,% 113,687 Contracts for fees have a built-in 3% increase.Utilities 1,% 1,260 Utilities cost will increase to the rising cost of oil partially offset by the efficiency of the hospital's new heating and cooling systems. Other 1,% 1,840 No net change in the cost or volume of these items. Depreciation & amortization (noncash expenses) 36,% 36,036 Some high-cost equipment—air conditioning, telephone system, all patient beds, and headwalls—were replaced in 2009, and depreciation rose sharply. Depreciation will remain at this level in 2010. Interest 3,% 4,820 The repayment plan for any monies borrowed in 2009 will come due in 2010, with a sharp increase in interest cost.
Provision for doubtful accounts 13,% 15,176 The renegotiation of managed care plans has delayed collection and made collections less certain. Total expenses 462,% 468,125 Total expenses will rise 1%. 2009 (Proj) 2010 Budgeted % Change From 2009 Projection 2010 Budget 2010 Operating Budget Assumptions Income Operating income % 916 Operating Income will improve, with the hospital's loss reduced by 2/3. Loss (nonoperating income) Investment income (% (62) The market is down, expected to hold steady; a zero-return is expected, with neither losses nor gains. Net income % 854 The hospital will continue its dramatic turnaround, taking advantage of the stagnation in patient volume, price deflation, the efficiency of new equipment, and the improved arrangements with the managed care companies.
Paper for above instructions
Comparison of Hiring More Nurses vs. Giving Existing Nurses a Raise at Patton-Fuller Community HospitalIntroduction
The nursing staff is crucial for patient care in hospitals; thus, the decision-making regarding its adequacy is paramount. The communication exchanged among Davis Geach, Zachary Hardie, and Caterina Hossack sheds light on a pressing issue at Patton-Fuller Community Hospital (PFCH): the insufficient nursing staff versus increasing salaries for existing nurses. This paper aims to analyze the financial implications and operational impact of both hiring more nurses and providing salary increments. Through this analysis, we will evaluate how each option may address nurse overwork and subsequently enhance patient care and retention rates.
Current Nursing Situation
The current patient-to-nurse ratio at PFCH stands at 5:1, meaning one nurse is responsible for five patients. This ratio has raised concerns about nurse burnout and its subsequent effect on patient care (Bai, 2021). Caterina Hossack proposes a new ratio of 4:1, equating to one nurse managing only four patients, which could lead to enhanced patient care and increased job satisfaction for nurses (Gordon et al., 2020). However, the transition to a 4:1 ratio involves hiring more nurses, leading to higher labor costs.
Financial Analysis of Hiring More Nurses
Hiring more nurses means increasing the nurse workforce to maintain a more favorable patient-to-nurse ratio. The cost of hiring is substantial, considering the average salary of nurses, which, based on Zachary Hardie's financial model, stands at per hour alongside other benefits. Below is a simple breakdown of the costs associated with hiring additional nurses to achieve a 4:1 ratio.
1. Calculating Required Staff: Current projections indicate that PFCH would need around 107 nurses daily under a 4:1 ratio, compared to approximately 85 nurses daily under the existing 5:1 ratio (PFCH Nursing Statistics).
2. Salary Estimations: Given that a nurse works 24 hours a day at the aforementioned rate, the nursing cost per day at the 4:1 ratio would be approximately ,033, compared to ,648 at the 5:1 ratio (PFCH Nursing Statistics).
3. Monthly Cost Analysis: Over the year, the additional monthly cost for the increased staff could approximate 7,770, significantly impacting the hospital's budget (PFCH Nursing Statistics).
The Case for Increasing Nurse Salaries
Alternatively, increasing the existing nursing staff's salaries could mitigate the challenges of turnover and staff retention without the additional hiring costs. A increase per hour for each nurse results in a daily rise in costs; however, it eliminates the need for additional hires.
1. Cost Implications: For each nurse, a increment leads to wage costs increasing from to , leading to an additional ,703 expense per month (PFCH Nursing Statistics).
2. Retention Benefits: Increasing salaries may address personnel turnover, which has been a growing concern at PFCH (Bai, 2021). Hiring new staff incurs onboarding and training costs, which can be avoided by investing in existing personnel.
Broader Implications for Patient Care and Job Satisfaction
1. Patient Care: A better staff-to-patient ratio with new hires could enhance the quality of service, ultimately improving patient outcomes and satisfaction (Gordon et al., 2020). Studies indicate lower ratios correlate with better patient satisfaction (O’Brien-Pallas et al., 2020).
2. Staff Satisfaction: Increased salaries could enhance job satisfaction and morale among nurses. According to a study by Aiken et al. (2018), higher salaries frequently correlate with lower turnover and higher job satisfaction amongst nursing staff.
3. Workforce Stability: A stable and satisfied workforce can mean less disruption in patient care. Higher turnover leads to inconsistencies in care, negatively impacting patient experiences (Bai, 2021).
Alternative Solutions
Instead of polarizing between hiring new staff and increasing current salaries, PFCH could potentially consider a hybrid approach by:
1. Implementing Flexible Staffing: Utilize part-time nurses during peak hours, especially considering the hospital's fluctuating patient occupancy rates throughout the year.
2. Introducing Incentives: Offering completion bonuses, competitive benefits, or pathway programs for existing staff could help retain quality staff while addressing concerns over workload.
3. Assessing Non-Financial Factors: Examining elements such as working conditions, support systems, and professional development could enhance job satisfaction, retaining staff without affecting salary structures directly (Bai, 2021).
Conclusion
As PFCH prepares for the board presentation on nursing staffing, it is crucial to weigh the implications of both hiring additional nurses and increasing current nurses’ salaries. While hiring more nurses can improve patient care, the financial strain can be substantial. Conversely, solely relying on salary increases may not adequately address the nursing workload concerns. A strategic approach combining optimal staffing, enhanced compensation, and robust staff support systems may be the key to resolving these pressing concerns while maintaining fiscal responsibility.
References
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