The CAPC Payment Accelerator: A Joint Virtual Workshop for Home-Based Care Teams-CAPC Financial Analysis and Budgeting Tool Companion Guide

CAPC Financial Analysis and Budgeting Tool Companion Guide

Pdf Summary

The "Budgeting and Financial Analysis: A Descriptive Companion Guide" addresses the financial planning necessary for palliative care providers aiming to build, sustain, and expand their services in community settings. The guide is meant to be used in conjunction with the "Budget and Financial Analysis Tool" to model and test various program assumptions iteratively, such as staffing models, patient encounters, and payment rates, to see their financial outcomes.<br /><br />**Key Points:**<br />1. **Collaborative Effort:** Work with your organization's financial management team and departments like finance, human resources, and senior leadership to develop a realistic budget. Their involvement ensures the incorporation of accurate norms for salaries, benefits, and payment levels.<br /><br />2. **Chicken and Egg Dilemma:** Budgeting for a new clinical service often starts with a rough estimate of demand and a core team. The guide suggests varying this initial team as needed to fit realistic assumptions about capacity, utilization, costs, and revenue.<br /><br />3. **Worksheets Overview:** The Budgeting and Financial Analysis Workbook includes six worksheets, which cover:<br />   - Overview and Tips<br />   - Operating Budget and Key Statistics<br />   - Staff Cost Assumptions<br />   - Non-Personnel Expense (NPE) Assumptions<br />   - Visit and Capacity Assumptions<br />   - Billing Revenue Assumptions<br /><br />4. **Building the Budget:**<br />   - **Staffing Costs:** Begin with employed staff costs, categorizing by Full-Time Equivalents (FTEs) and factoring in fringe benefits.<br />   - **Contracted Staff:** For contractors, the budget should reflect hourly rates or a total cost contract without adding fringe benefits.<br />   - **Non-Personnel Expenses:** These can be direct costs (like travel and patient supplies) and indirect costs (like rent, IT, and insurance).<br /><br />5. **Capacity and Utilization:** Calculate patient care time by factoring in holidays, vacations, administrative work, and average visit durations. This helps estimate the program's total visit capacity and patient reach.<br /><br />6. **Revenue Estimates:** Focus on fee-for-service revenue but consider multiple revenue sources like grants or quality bonuses. Estimate a mix of visit types to calculate the weighted average per-visit payment, adjusting for payer mix and negotiated rates.<br /><br />7. **Finalizing the Budget:** Integrate expense and revenue assumptions into the operating budget, highlighting key statistics like costs per visit and net margins. Use these insights for continuous adjustments and improvement.<br /><br />8. **Efficiency Considerations:** Explore operational efficiencies and clinician capacity enhancements, such as refining staffing models, coordinating with other care providers, optimizing patient identification and eligibility processes, and negotiating reporting requirements with payers.<br /><br />The guide emphasizes iterative planning, stakeholder involvement, and operational efficiency to create a sustainable financial model for palliative care services.

Keywords

Budgeting

Financial Analysis

Palliative Care

Community Settings

Staffing Models

Revenue Estimates

Operational Efficiency

Capacity Utilization

Expense Assumptions

Financial Planning