Crisis Management - Lesson from Bp Gulf Oil Spill

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Review of Healthcare Block Budget Subvention

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Case: NUH at WestPoint Hospital

As NUH was facing very bad bed crunch, the management decided to lease beds from private players to extend its inpatient facility. As the manager from Inpatient Operations, I was tasked to put up the funding request to Ministry of Health for the additional subvention to support NUH operate the offsite inpatient facility at WestPoint Hospital.

The funding supplied by Ministry of Health is very much like a mini-block budget. Because we have to do whatever costing and volume projection the year before, and once the blocked is determined, NUH will have to live with it for the next 1-3 years, hence the hospital is subject to all the risk factors: Rise in patient volume, lease rental & other purchased service cost increase etc. Because during the initial phase, NUH was having some difficulty to fill up the entire ward, the bed occupancy was hanging around 70%, hence the ministry only agreed to support NUH based on 75% bed occupancy projection; however, in this year most of the time we have the occupancy hanging around 80% or higher, and the higher patient volume definitely will consume more manpower (esp. clinician, allied health) which leads to higher cost; For the lease rental, Ministry was only comfortable to funding us based on 3% annual increment, but from 2012 to 2011 there was 8.3% increase requested by the vendor, and we yet to hear from the vendor the new lease cost for 2013, hence we are praying hard that increase will be minimum. We are yet to conduct a re-costing exercise for WestPoint Hospital this year, but are expecting some losses by running this additional unit for the financial year 2012.

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As we all know, in 2005, MOH once a quarter began providing public hospitals subvention funds, also known as block...
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