Counting the Costs

Counting the Costs
Now you are ready to count the costs of your strategy/intervention (s). From the three
best strategies identified in Assignment 2, select the strategy/s you would want to
implement to address your practice issue. The assignment has two parts; a budget and a
cost analysis.
For Your paper, you MUST include the headings in the grading guide to help organize
your paper. The paper should not be more than 4-6 pages in length (excluding title page
and reference list). You will need a minimum of six references for this paper.
Start out your paper with an introduction to the project. Briefly state what will be done
by whom and where will it be done. What is your overall goal? (No more than 1/2
page….this and all subsequent page limits per item are recommendations).
Then prepare a line by line budget as an appendix
Now break down the expense for each item. For example, you may have listed $4000 for
nursing expenses in your budget. Now you should explain that if an RN sees 10 patients
per week, and there is a nursing assistant receptionist, the plan will cost $1000 each
week. This would be a cost of $100 per patient to pay the salaries of the RN and
assistant. If you plan to carry on the project for a month, it will cost $4000 for 40
patients.
These are the type of things you must consider in your budget:
Any increased personnel (RNs, LPNs, or NAs) needed to implement your plan. Any
extra overtime for existing personnel to learn the new teaching plan.
The cost of duplicating handouts, booklets, etc to teach the program. The cost of flyers
or ads to advertise about the new program.
Any new equipment needed for patients to take home (i.e. BP monitor, cook books,
pedometer) Will you need a projector and computer to teach large groups of patients
and families?
Will the patients need to come back for follow up assessment and possible
reinforcement teaching or will this be a one time discharge teaching course.? (If another
follow-up class is needed, calculate the cost of an individual doing this.)
Will you need a secretary or some other personnel to do a follow-up phone call and find
out how the patient is doing, reinforce teaching, or schedule another class for more
teaching?
Also look at the indirect cost of the plan (i.e. fringe benefits for extra employees). The
cost of room to teach in may be an indirect in-kind cost.
What is the total cost of the project?

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COUNTING THE COSTS

Counting the costs
Introduction and thesis statement

This project entails implementing 2 strategies. A teaching program will be conducted
in which nurses will provide teaching to patients and their families regarding the
interventions. This teaching program would be done in a facility that would be rented for this
purpose. The aim is to implement the 2 interventions/strategies and provide teaching about
them. From the 3 strategies/interventions identified in assignment 2, those that I would want
to implement to address the practice issues are: (i) Screening for type 2 diabetes mellitus with
the use of glycated hemoglobin, two-hour oral-glucose tolerance test, and fasting plasma
glucose (FPG). (ii) Lifestyle modifications, and this entails maintaining a weight that is
healthy, increasing the everyday physical activity, and eating diet that is healthy. Thesis
statement: the cost of a teaching class on interventions to lower Hemoglobin A1Cs for
children and adolescents with type 2 diabetes mellitus is lower compared to the costs of
outcomes of the patients not reducing A1Cs.

Line-item budget showing all expenses and program costs

For the line-budget, see Appendix 1.

Breakdown of each individual item

Nursing expenses: $28,000.00: in the event that a nurse attends to 7 patients per week,
and there is a nursing assistant receptionist, the plan will cost $7,000 per week. This would be
a cost of $1000 per patient to pay the salaries of the nurse and the assistant. Considering that
the project would be carried out for 4 weeks, it would cost $28,000 for 28 patients. Five extra
personnel: $17,000.00: 5 more personnel would be hired each costing $850.00 per week,
which would be $4,250 per week and $17,000 for 4 weeks. Extra overtime for existing

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COUNTING THE COSTS
workers $10,080: there are 6 existing nurses and each will cost $420 overtime translating to
$10,080.00 per month. Materials to teach the program $7,764: duplicating brochures $2,100,
booklets $2,300, and handouts $3,364 totaling to $7,764. Flyers and ads $5,960: flyers
$2,000, and ads $3,960. New equipment required $13,050: blood pressure (BP) monitor $390,
which will be $10,920 for 28 patients for the whole 1 month, projector will be $1,280, and
computer would be $850, totaling $13,050 for the equipment. Follow-up assessment is $244
per patient totaling to $6,832 for all 28 patients. The secretary would be paid $1,060 per week
which is $4,240 per month. The conference hall will cost $1,000 per week. The total of all
these costs adds up to $97,226.00.

Broad scope perspective of the analysis

This project involves comparing cost of a teaching class on interventions to lower
Hemoglobin A1Cs for children and adolescents with type 2 diabetes mellitus, versus the costs
of outcomes of the patients not reducing A1Cs. The entire project would take 4 weeks. The
project would cost a total of $97,226.00. It is expected that the cost of a teaching class is less.

Estimate of program effects

In most instances, children with type II diabetes mellitus visit the hospital on average
7 times annually (Wald et al., 2012; Pozzo & Kemp, 2012). Generally, youngsters to be
screened comprise adolescents and children ranging from aged 17 years or less. There are
usually screening visits, and a treatment period that comprises 3 days of inpatient stay per
patient (Cox, Karen & Polvado, 2008; Willi et al., 2004). Insulin therapy is provided for
patients with: Hemoglobin A1c (HbA1c) greater than 9 percent, or blood glucose
concentrations ≥ mg/dL, concentrations of HbA1c monitored every 3 months. The patient is
also given nutrition counselling (Reinehr, 2013).

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COUNTING THE COSTS

Estimate of Monetary Value of outcomes

The cost of each clinic visit per patient is $15,750. The cost of each day of inpatient
stay per patient is $750, and since the treatment comprises 3 days of inpatient stay, total cost
per patient per year would be $15,750 per patient (Hansen, Fulop & Hunter, 2009). This
program is intended to reduce the number of clinic visits to only 3 every year. This way, it
will only cost the patient $6,750 annually in clinic visits, thereby saving $9,000 per year in
clinic visits. If the project reduces the length of inpatient stay from the current 3 days to only
1 day per year, it will cost the patient only $5,250 annually, which is a saving of $10,500.

Account for the effects of time

At present, the patient visits the clinic 7 times a year and for each clinic visit, there is
an inpatient stay of 3 days. Thus, the patient spends a total of 21 days in hospital every year
(Nesmith, 2009). If the program reduces the number of clinic visits to only 3 per year, the
patient would only spend 9 days in hospital annually. This is a substantial saving of 12 days.
Moreover, if the project reduces length of inpatient stay to just 1 per year, there would only
be 7 visits per year, a great saving of 14 days. Considering that the patients are adolescents
and children with type 2 diabetes, they are still at school and the hospital visits usually affect
them academically since some of the time they should in school they spend it in hospital as
inpatient. It is noteworthy that these saved days would lead to increased attendance at school
and possibly contribute to their improved performance in school (Gahagan & Silverstein
(2003).

Distributional consequences

This program will not only be of benefit to the affected children who will have their
number of clinic visits reduced considerably, but other parties such as parents/family

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COUNTING THE COSTS
members and insurance firms would also see the benefits. Parents would benefit in the sense
that there would be fewer days lost at work taking their diabetic youngsters for clinic visits.
As such, there would be increased productivity by parents (Eriksson, Lindstrom &
Tuomilehto, 2013). Insurance firms would also benefit in the sense that there would be less
medical costs for them to pay for the diabetic youngsters. Considering that the program could
save up to 14 days, it implies that RNs would have 14 free more days to teach the program,
make follow-up or focus on other duties. At present, nurse patient ratio is 1:5; one nurse
attends to 5 patients (Reinehr, 2013). However, the program would result in decreased
hospital clinics by up to one third, meaning that one nurse would attend to just 2 patients and
the nurse patient ratio would be 1:2.

Sensitivity analysis

It is notable that the cost estimates could change to some extent. As per the budgeted
cost, the secretary would be paid $4,240 for the 4 week period. However, this cost could go
up should the individual demand for increment. The cost of conference hall for the program is
projected to cost $4,000. However, one of the families of the patient could offer their
conference hall, and the cost would be saved. The cost of equipment is budgeted to cost
$13,350. Nonetheless, some equipment such as the computer and projector might be donated
by a well-wisher. The cost of flyers and ads is estimated to cost $5,960. A well-wisher might
support the project and offer to fund this cost.

Qualitative residual

The most noteworthy and significant benefit of the program is certainly reduced pain
as well as suffering to patients and their families. The program would lead to increased
screening and treatment of type 2 diabetes mellitus, as well as increased access to clinics. In
turn, this would lead to reduced pain for patients and their families (Cox, Karen & Polvado,

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COUNTING THE COSTS
2008). Moreover, the quality of life would improve substantially since the health of the
patient would improve. This project would help in reducing blindness and retinopathy of the
patient. In so doing, the adolescent diabetics would have their eye sights improved.
Consequently, they would be able to attend school satisfactorily, pursue a career of their
choice and could work in a profession that calls for good eyesight.

Conclusion

In conclusion, the entire cost of the program is budgeted to cost $97,226. The items
for the budget include nursing expenses, cost for extra personnel, follow-up assessment,
secretary, flyers and ads, equipment, conference hall, cost of overtime and cost of duplicating
teaching materials. Implementing the new program would result in substantial saving in both
time and money. The diabetic adolescents could utilize the saved time to focus on the
schoolwork, and their parents will have more time for their various jobs. Insurance firms
would also benefit because there would be less medical costs for them to pay for the diabetic
youngsters. It is of note that cost estimates could change. The cost of conference hall for the
program is projected to cost $4,000. However, one of the families of the patient could offer
their conference hall, and the cost would be saved. The most noteworthy and significant
benefit of the program is certainly the reduced pain and suffering to patients and their
families, and the fact that there would be improved quality of life for patients.

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COUNTING THE COSTS
Appendix 1: Line-budget

Line-budget

Item Cost in $
Nursing expenses 28,000.00
5 extra personnel to execute the plan 17,000.00
Extra overtime for existing workers to learn the new teaching plan 10,080.00
Cost of duplicating brochures, booklets and handouts to teach the
program

7,764.00
The cost of flyers and ads to advertise about the new program 5,960.00
New equipment required for the patient to take home (blood pressure
monitor), as well as computer and projector to teach large groups of
patients and their families

13,350.00

Follow-up assessment 6,832.00
Secretary 4,240.00
Cost of conference hall to teach the program 4,000.00
Total costs 97,226.00

References

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COUNTING THE COSTS
Bowen, M. E., & Rothman, R. L. (2010). Multidisciplinary Management of Type 2 Diabetes
in Children and Adolescents. Journal of Multidisciplinary healthcare, 21(3): 113-124.
Cox, D., Karen, J., & Polvado, N. P. (2008). Type 2 Diabetes in Children and Adolescents.
Advance Healthcare, 16(11): 43.
Eriksson, J., Lindstrom, J., & Tuomilehto (2013). Potential for the Prevention of Type 2
Diabetes. British Medical Bulletin, 60(1): 183-199.
Gahagan, S., & Silverstein, J. (2003). Prevention and Treatment of Type 2 Diabetes Mellitus
in Children, With Special Emphasis on American Indian and Alaska Native Children.
PEDIATRICS, 112(4): 188.
Hansen, J. R., Fulop., M. J., & Hunter, M. K. (2009). Type 2 Diabetes in Youth: A Growing
Challenge. Clinical Diabetes, 18(2): 174-177.
Nesmith, D. J. (2009). Type 2 Diabetes Mellitus in Children and Adolescents. PEDIATRICS
IN REVIEW, 2(5): 147-152.
Pozzo, A. M., & Kemp, S. (2012). Pediatric Type 2 Diabetes Mellitus. Medscape, 33(2): 72-
81.
Reinehr, T. (2013). Type 2 Diabetes in Children and Adolescents. World Journal of Diabetes,
4(6): 270-281.
Wald, E. R., Moyer, S. C. L., Eickhoff, J., & Ewing, L. J. (2012). Treating Childhood Obesity
in Primary Care. SAGE Journals, 74(4): 123-129.
Willi, S. M., Martin, K., Datko, F. M., & Brant, B. P. (2004). Treatment of Type 2 Diabetes
in Childhood Using a Very-Low-Calorie Diet. Diabetes Care, 27(2): 348-353.

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