Overview
Description
The proposed annual budget shows expected revenue increases due to greater volume from additional contracting with managed care plans. Word has come from the executive team that the expense portion of the budget needs revision due to value-based purchasing (VBP) contracts being implemented (including per member per month [PMPM] contracts, care bundles, and global payment).
Your health service organization (HSO) must cut total expense from the current proposed annual budget to achieve a 5% profit margin. Note that individual line item reductions may differ, and the expected total expense reduction will be the result in income that shows a 5% profit.
As a member of the budget team, you are asked to provide the following:
- A revision of the Excel budget sheet below (you are to revise the area of the table in the red box) showing the proposed cuts in line items to achieve the 5% profit marginUnit 4 Excel Budget Sheet
- A written 3–5-page report that does the following:
- Identifies and justifies where budget expense cuts should be made
- Discusses possible effect(s) that these reductions would have on services provided, such as inpatient (IP) services (which ones), outpatient (OP) services (which ones), or other services
- Explores the long-term sustainability of these cuts in light of continued growth in VBP contracting in your HSO
The written work should discuss and provide specific support as reasoning for the response to each prompt above.
Please submit your assignment.
For assistance with your assignment, please use your textbook and all course resources.
| Expectation | Points Possible | Points Earned | Comments |
| The revised Excel budget displays the proposed cuts and is correct in format. | 25 | ||
| The write-up indicates specific proposed reductions that match the budget table and provides substantive supported reasoning as justification for making the assertions. | 30 | ||
| The write-up discusses the effects that the reductions would have on services offered regarding the IP and OP services. | 30 | ||
| The write-up explores ideas on the sustainability of the reductions based on VBP contracting growth. | 30 | ||
| Professional Language: Assignment contains accurate grammar, spelling, and punctuation, with few or no errors. (APA formatting or the style specified in the assignment is required.) | 10 | ||
Total Points | 125 | ||
Total Points Earned |