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Budgeting in Healthcare

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Decision Making in Healthcare Systems

Part of the book series: Studies in Systems, Decision and Control ((SSDC,volume 513))

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Abstract

This chapter provides a comprehensive analysis of budgeting processes in healthcare organizations as not-for-profit entities. It emphasizes the significance of financial elements such as the reinvestment rate, financing rate, present value (PV), and future value (FV) in effective budgeting. The chapter introduces the Total Net Present Value (TNPV) concept, which includes both financial Net Present Value (NPV) and Net Present Social Value (NPSV). The TNPV emphasizes the importance of project proposals to achieve a balance between financial viability and social value. The manuscript stresses the importance of transparency and accountability when creating a budget. This budget serves as a guide for obtaining donors’ trust and helps make decisions for an organization. It explains the different parts of a budget, including the various revenue sources, allocation of expenditures, and direct and indirect costs. The manuscript also distinguishes between operating budgets, which show projected annual income and expenditures, and capital budgets, which cover projects with long-term effects and substantial costs. Aligning budgeting with strategic planning is emphasized as a means to help achieve organizational goals.

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Author information

Authors and Affiliations

  1. Faculty of Commerce and Finance, University of Tehran, Tehran, Iran

    S. Khajavi

  2. Department of Accounting, Bandar Anzali Branch, Islamic Azad University, Bandar Anzali, Iran

    M. Etemedy Jooriaby

  3. Department of Accounting, Dariun Branch, Islamic Azad University, Dariun, Iran

    E. Kermani

Authors
  1. S. Khajavi
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  2. M. Etemedy Jooriaby
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  3. E. Kermani
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Corresponding author

Correspondence to S. Khajavi .

Editor information

Editors and Affiliations

  1. Faculty of Engineering and Natural Sciences, Istinye University, Istanbul, TĂĽrkiye

    Tofigh Allahviranloo

  2. Department of Mathematics, Science and Research Branch, Islamic Azad University, Tehran, Iran

    Farhad Hosseinzadeh Lotfi

  3. School of Information Technology, Deakin University, Waurn Ponds Campus, Geelong, VIC, Australia

    Zohreh Moghaddas

  4. Department of Mathematics, Islamic Azad University, Rasht, Iran

    Mohsen Vaez-Ghasemi

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Khajavi, S., Etemedy Jooriaby, M., Kermani, E. (2024). Budgeting in Healthcare. In: Allahviranloo, T., Hosseinzadeh Lotfi, F., Moghaddas, Z., Vaez-Ghasemi, M. (eds) Decision Making in Healthcare Systems. Studies in Systems, Decision and Control, vol 513. Springer, Cham. https://doi.org/10.1007/978-3-031-46735-6_9

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