A dietary manager at a nursing home opened an email from the business office on a Thursday afternoon that said dietary was close to its budget for the month. The week's produce order was still sitting in the cart. The email gave a percentage and nothing more, so the manager walked down the hall to ask the administrator whether the order could go out.
A budget alert is the message sent when a department's spend reaches a set share of its budget for the period. It should tell the department head what the budget figure is, what census it assumes, what spend it has counted so far, and what to do about the next order.
What should a budget alert include?
A budget alert should include the department, the period, the threshold crossed, the budget figure for the period, the census that figure assumed, the spend counted so far and what is not in it yet, and the action expected. A percentage on its own does not say what it was measured against.
The budget figure matters because a per patient day budget is not a fixed dollar amount for the month. A dietary budget set per patient day grows when the census goes up and shrinks when it drops, so the same percentage late in the month means one thing in a full building and another in a building with a wing closed. What PPD means in long-term care finance covers the term.
The action line is the easiest to leave out and the reason the alert exists. An instruction to hold orders that can wait until the administrator confirms is something a dietary manager can follow at the cart.
Why does the census matter in a budget alert?
The census matters because the budget behind the alert is set per patient day, so the dollar figure for the month changes whenever the census changes. Where the census feeds the budget from the EHR every day, the budget behind today's alert is not the budget behind last week's, even if nothing was ordered in between. How a per patient day budget moves when the census moves has the arithmetic.
An alert should state the census it used, so the department head can check it against the count the building reported that morning. A move-in or a discharge that posted after the alert was built changes the budget again.
Does a budget alert count purchase orders or invoices?
A budget alert can count approved purchase orders, invoices received, or both, and it should say which. Purchase orders show what the department has committed to for the month. Invoices show what the vendor billed, which can be higher than the order when a price changed or a substitution went through.
A cart that has been built but not submitted is in neither figure, which is why the manager with a produce order in the cart cannot read the answer off a percentage. The alert should say whether open carts are counted. The tracking side is in how to track spending against PPD budgets in real time.
What should a department head do at 70% and at 90%?
Our playbook suggests alerts at 70% and 90% of the monthly PPD budget for each department, and the two alerts call for different actions.
| Threshold | What it tells the department head | What to do next |
|---|---|---|
| 70% of the month's PPD budget | The rest of the month needs a plan | Compare the days left with the budget left, and move any order that can wait |
| 90% of the month's PPD budget | The next sizable order is likely to take the department over | Hold orders that can wait, and tell the administrator before the next one goes in |
Whatever thresholds an operator sets, each alert should say which threshold it is and whether another one follows, so the first alert reads as planning time and not as a stop sign.
Who should get a budget alert?
The department head who places the orders should get the budget alert first, because that is the person who can change the next order. The administrator should see the same alert, since holding dietary or housekeeping orders affects residents. The controller needs it as the record of when the department was warned, and an alert that reaches only the controller leaves the next order unchanged.
How budget tracking works in Adelpo
PPD budget tracking and alerts are part of Adelpo's procurement module. The per patient day budget for each department adjusts daily from the census synced from PointClickCare, MatrixCare, or another EHR, and the person building a cart sees the budget impact in the cart's Budgets tab before submitting. Submitting a cart does not change the budget. The budget takes the order when the PO goes to the vendor, and the invoice updates it if the amount differs. A budget alert in Adelpo shows the budget amount, the percentage used, the spend so far, and the PPD budget, and it arrives both in the app and by email. Each customer chooses the levels that trigger it, for example 75% and 95%, for a department or a sub-department. It usually goes to purchasing directors and administrators, depending on the customer.
Questions department heads ask about budget alerts
What is a budget alert in procurement?
A budget alert is a message sent when a department's spend for a period reaches a set share of its budget. It goes to the people who place or approve orders so they can change the next order before the period closes. A useful one states the budget figure, the census behind it, the spend counted, and the action expected.
Does a budget alert count orders I have not submitted yet?
That depends on the system, and the alert should say what it counts. A cart that has not been submitted is not a commitment, so a budget that counts approved purchase orders will not include it. In Adelpo, submitting a cart does not change the budget, and the cart's Budgets tab shows the impact before you submit.
Why did my department budget change when I did not order anything?
If the budget is set per patient day, the dollar figure for the month moves with the census, not with orders. A move-in or a discharge changes the day's budget even when nothing was bought. Check the census the alert used against the building's own count before acting on the percentage.