Question: How Will You Meet New Budget Restrictions? You are the director of the local agency that cares for ill and well elderly patients. You are funded by a private corporation grant, which requires matching of city and state funds. You received a letter in the mail today from the state that says state funding will be cut by $35,000, effective in 2 weeks, when the state's budget year begins. This means that your private funding also will be cut $35,000, for a total revenue loss of $70,000. It is impossible at this time to seek alternative funding sources. In reviewing your agency budget, you note that, as in many healthcare agencies, your budget is labor intensive. More than 80% of your budget is attributable to personnel costs, and you believe that the cuts must come from within the personnel budget. You may reduce the patient population that you serve, although you do not really want to do so. You briefly discuss this communication with your staff; no one is willing to reduce his or her hours voluntarily, and no one is planning to terminate his or her employment at any time in the near future. ASSIGNMENT: Given the following brief description of your position and each of your fi ve employees, decide how you will meet the new budget restrictions. What is the rationale for your choice? Which decision do you believe will result in the least disruption of the agency and of the employees in the agency? Should group decision making be involved in fi scal decisions such as this one? Can fi scal decisions such as this be made without value judgments? Your position is project director. As the project director, you coordinate all the day-to-day activities in the agency. You also are involved in long-term planning, and a major portion of your time is allotted to securing future funding for the agency to continue. As the project director, you have the authority to hire and fi re employees. You are in your early 30s and have a master's degree in nursing and health administration. You enjoy your job and believe that you have done well in this position since you started 4 years ago. Your yearly salary as a full-time employee is $80,000.
Employee #1 is Mrs. Potter. Mrs. Potter has worked at the agency since it started 7 years ago. She is an RN with 30 years of experience working with the geriatric population in public health nursing, care facilities, and private duty. She plans to retire in 7 years and travel with her independently wealthy husband. Mrs. Potter has a great deal of expertise that she can share with your staff, although at times you believe she overshadows your authority because of her experience and your young age. Her yearly salary as a full-time employee is $65,000.
Employee #2 is Mr. Boone. Mr. Boone has BS degrees in both nursing and dietetics and food management. As an RN and Registered Dietician (RD), he brings a unique expertise to your staff, which is highly needed when dealing with a chronically ill and improperly nourished elderly population. In the 6 months since he joined your agency, he has proven to be a dependable, well-liked, and highly respected member of your staff. His yearly salary as a full-time employee is $55,000.
Employee #3 is Miss Barns. Miss Barns is the receptionist-secretary in the agency. In addition to all the traditional secretarial duties, such as typing, fi ling, and transcription of dictation, she screens incoming telephone calls and directs people who come to the agency for information. Her efficiency is a tremendous attribute to the agency. Her full-time yearly salary is $26,000.
Employee #4 is Ms. Lake. Ms. Lake is an LPN/LVN with 15 years of work experience in a variety of healthcare agencies. She is especially attuned to patient needs. Although her technical nursing skills are also good, her caseload frequently is more focused around elderly patients who need companionship and emotional support. She does well at patient teaching because of her outstanding listening and communication skills. Many of your patients request her by name. She is a single mother, supporting six children, and you are aware that she has great difficulty in meeting her personal financial obligations. Her full-time yearly salary is $48,000.
Employee #5 is Mrs. Long. Mrs. Long is an "elderly help aide." She has completed nurse aide training, although her primary role in the agency is to assist well elderly with bathing, meal preparation, driving, and shopping. The time that Mrs. Long spends in performing basic care has decreased the average visit time for each member of your staff by 30%. She is widowed and uses this job to meet her social and self-esteem needs. Financially, her resources are adequate, and the money she earns is not a motivator for working. Mrs. Long works 3 days a week, and her yearly salary is $23,000.