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Budgeting Basics for Medicaid Organizations

Budgeting Basics for Medicaid Organizations

Medicaid organizations have closely watched budgets — government agencies must be sure budgets line up with recommendations and allowances on a state and federal level. Data analysis, care delivery analysis, and analysis of other existing data collected by the agency can inform future budgets and assist in altering current budgets where it is needed. The budget of an organization can impact everyone from individuals receiving services to employees to agency suppliers and must be considered carefully before changes are made. The purpose of a budget is to plan, track, and control spending and support funding requests. Let’s take a closer look.  

Analyzing the Current Budget

Although many aspects of a direct support provider agency’s budget are determined by state and federal regulation, there is some wiggle room. Analyzing the budget will require the help of financial professionals within the agency, or supplied through third-party auditing companies or the government. The main steps of budget analysis are:
  • Item-by-item review and analyzing expenditures
  • Using tools to help analysis
  • Incorporating the organization’s mission
  • Funding authorization and a budget resolution
  • Measuring performance, effectiveness, and outcomes of the new budget
In plain speak, every aspect of a Medicaid organization’s budget must be examined using tools to analyze the data, the purpose of the agency must be revisited, changes must be decided on, and outcomes must be measured once the new budget is implemented.  

Need help? DCI can help with budget analysis!


Establishing a Timeline for New Budget Implementation

Once an organization knows which changes need to be made, a timeline for making the changes should be established. Finance and management are the best people for this job, as well as IT employees who will be implementing the changes in the network or system. The timeline should be rolled out to the entire agency in time for completion, and adjusted if necessary.  

Budgeting Policy & Procedure Follow Up

As in any large agency or provider budget change, measurements will have to be put in place to find out if the budgetary changes are or were effective, and what future changes may need to happen. Monitoring a budget is an ongoing project that all businesses and organizations should stay on top of if they wish to be successful.  

DCI can help an organization analyze, plan, and implement any budget changes necessary to improve functioning, resources, and care.


Using a Project Management Approach

The best and simplest way to ensure that a new budget is planned, implemented, and successful at an organization funded by Medicaid is to follow a project management approach. Project management requires that the provider agency goes through these steps to ensure that the budget project is properly begun, completed, and reviewed for success or changes down the line:
  • Initiation
  • Planning
  • Execution
  • Monitoring and Controlling
  • Closing
Notice that much of this process happens after implementation. With a new budget, measuring outcomes will consist of meeting budgetary constraints, purchasing power, and driving all departments and areas of the provider’s mission forward at every step.   The expertise of Direct Care Innovations (DCI) can help an organization avoid the pitfalls of planning, implementing, and monitoring a new budget from the very start. DCI can also help with various aspects of implementing a new budget, including authorization management, training certification, payroll, billing, and scheduling. Contact us on our website or give us a call to schedule a demo of our software and change your budget for the better.

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