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Cost Variance in Healthcare Organizations
Pages 5 (1255 words)
Cost Variance in Healthcare Organizations Introduction Budget management is essential in different industries of an economy. This is because it enables organizations to operate with low costs while maintaining their effectiveness in service delivery. Budget management involves analysis and controlling of budget variance…
Like other healthcare organizations, the budget management in this healthcare organization is said to be underdeveloped. This is the reason why we have identified it for the analysis so that we can make possible recommendations. Strategies of Managing Budgets Within Forecast Managing budgets within forecasts is significant in revenue attainment and costs containment. However, ensuring that budgets remain within forecasts is not an easy task. Moreover, budget forecasts are not always accurate in terms of budgetary estimates they give. This makes designing of a strategic budgets management approach to be a necessity in healthcare organizations. In this healthcare organization, specific strategies exist for managing budgets within forecasts. These strategies vary both in their characteristics and in applicability. However, the majority of them are applicable in healthcare organizations like the one identified in this paper. One of the strategies that could be significant in managing budgets within forecasts is the use of both quantitative and qualitative approaches during forecasting. According to Cole (2003), quantitative approach uses numeric data such as statistics and the accounting data to draw projections. ...
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