BOOKS OF RtfiDIfGS - PAHO/WHO

udgeting, and controlling processes
(PBCP) for health care institutions.
Schematic diagrams of each of the th.,:.
processes are presented (Figures 2, 3,
and 5) for the purposes of highlighting
the important data elements, relationships,
and decision points. These diagrams
are not intended to preclude
additional considerations or steps leading
toward decisions, and the ensuing
discussions must, because of space
constraints, be restricted to general
characteristics of the diagram elements.
(For more detailed discussions of methodological
options, evaluations, etc.,
see [201.)
Programming Phase
In the management control model
described above, the initial planning
step is that of deciding on the strategic
plans for the organization. Once decided,
the programs to be undertaken
and the approximate amount of resources
to be allocated to each program
are determined. The outputs of this
programmng process are decisions regarding
the revenues, expenses, and
capital requirements of patient care,
teaching, research, and overhead programs;
facility size; and objectives in
the area of improving or ensuring production
efficiency and effectiveness.
The programming decisions are based
on four major categories of informetion
(see Figure 2).
Marketing Information. The market
served by the hospital should be understood
well enough to permit costeffective
planning, i.e., to determine
the least costly arrangement of facilities
and services, consonant with community
needs. This should include three
important types of information: 1) determination
of service population of the
hospital and its characteristics 121], 2)
assessment of medical needs of the
service population [221, and 3) assess-
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Programing, Budgeting, and Control
ment of potential areas for cooperation
with other hospitals and providers [23].
It is recognized that difficulties arise in
trying to define and measure need fnr
medical services [24]. As a result, many
of the contemporary planning models
and the marketing information are demand
based. It should be noted that
increasingly hospitals are trying to influence
the amount and configuration
of their demand through various marketing
efforts.
Organizational Goals and $.trmiegic
Plans. The developmeni, statement,
and updating of organizatiorlal goals
and strategic plans is the second major
cf-t.gory of information necessary for
;h- programming process. These goals
initially provide direction for the decision
process and, later, become yardsticks
along which various program;.3
can be evaluated. It is important that
the formulation of these goals reflect
- inputs from a variety of individuals
within the organization, e.g., trustees,
administrators, depar,..en* heads, etc.
[17]. Such an exchange of ideas between
individuals at the different levels
not only provides useful suggestions
in the planning process, but helps
foster a córr-itment to the organization
arid its plans [25].
Previous Year's Performance. The
feedback loop in the general management
control process can suggest areas
whete adjustments are necessary and
areas where expectations should be
changed. The primary use of this information
is the .evaluation of ongoing
programs [3, Chap. 91, and the data is
generated during the Controlling Phase
which is discussed below.
Externa) Constraints. The hospital
industry operates within a larger legal
and economic system and is regulated
by a host of statutes and agencies.