Iran J Public Health, Vol. 52, No. 9, Sep 2023, pp.

1889-1901 Review Article

Budgeting in Healthcare Systems and Organizations: A

Systematic Review
Abbas Homauni 1, Nader Markazi-Moghaddam 1,2, Ali Mosadeghkhah 3, Majid Noori 4,
Kourosh Abbasiyan 1, *Sanaz Zargar Balaye Jame 1
1. Department of Health Management and Economics, School of Medicine, Aja University of Medical Sciences, Tehran, Iran
2. Critical Care Quality Improvement Research Center, Shahid Modarres Hospital, Shahid Beheshti University of Medical Sciences,
Tehran, Iran
3. Department of Endocrinology, Aja University of Medical Science, Tehran, Iran
4. Infectious Diseases Research Center, Aja University of Medical Sciences, Tehran, Iran
*Corresponding Author: Email: sanazzargar@gmail.com

(Received 24 Dec 2022; accepted 16 Mar 2023)

Abstract
Background: Budgeting is the process resource allocation to produce the best output according to the revenue
levels involved. Among the constraints that healthcare organizations, including hospitals, both in the public and
private sectors, grapple with is budgetary constraints. Therefore, cost control and resource management should
be considered in healthcare organizations under such circumstances.
Methods: We aimed to identify methods of budgeting in healthcare systems and organizations as a systematic
review. To extract and analyze the data, a form was designed by the researcher to define budgeting methods
proposed in the literature and to identify their strengths, weaknesses, and dimensions. The search was conduct-
ed in Google Scholar, Web of science, Pub med and Scopus databases covering the period 1990-2022.
Results: Overall, 33 articles were included in the study for extraction and final analysis. The study results were
reported in four main themes: healthcare system budgeting, capital budgeting, global budgeting, and perfor-
mance-based budgeting.
Conclusion: Each budgeting approach has its own pros and cons and requires meeting certain requirements.
These approaches are selected and implemented depending on each country's infrastructure and conditions as
well as its organizations. These infrastructures need to be thoroughly examined before implementing any budg-
eting method, and then a budgeting method should be selected accordingly.

Keywords: Budget; Budgeting; Health system; Healthcare organization

Introduction
A budget is a key lever in organizational planning location to produce the best outputs according to
and management (1). It can be defined as an es- the revenue levels involved (3). If done properly,
timate of revenues/expenditures over a given budgeting can help managers better manage and
time (2). Budgeting is the process of resource al- control the organization (4). As a management

Copyright © 2023 Homauni et al. Published by Tehran University of Medical Sciences.

This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International license.
(https://creativecommons.org/licenses/by-nc/4.0/). Non-commercial uses of the work are permitted, provided the original work is properly cited
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 Homauni et al.: Budgeting in Healthcare Systems and Organizations …

planning/control tool, budgeting helps coordi- affected as their actions directly affect human
nate activity concentration and control in organi- health (14).
zations. Budgeting shows financial management Various budgeting methods have been addressed
orientation to organizations. Therefore, every in many previous studies In global budgeting, a
organization has revenue and expenses that need certain amount of budget is allocated to services
budget and budgeting (5). offered to a given population for a certain time
The health (healthcare) sector is considered as (usually one year). The global budgeting method
one of the basic sectors in the process of eco- has its advantages and disadvantages, which will
nomic (6) and social development in each coun- be mentioned below. Many studies have evaluat-
try (7). ed the performance of the global budgeting ap-
The bulk of countries' budgets goes to the proach and its practical results (15-18).
healthcare system. About 10% of the GDP of Furthermore, the capital budgeting approach is
many countries is allocated to the healthcare sys- employed to meet capital needs in healthcare or-
tem (8). Moreover, examining the costs of ganizations (19). Surgical operations are becom-
healthcare systems and organizations indicates an ing more complex and reliant on specialized
increase in the costs allocated to healthcare ser- equipment and techniques, necessitating in-
vices (9). This can be due to several reasons, in- creased investment by hospitals and other
cluding population aging and the adoption of healthcare organizations (20). During normal pe-
state-of-the-art healthcare technologies (10). The riods, a large portion of hospitals' capital budget
improved quality of healthcare services is a dou- and investment decisions relating to the capital
ble-edged sword, both increasing life expectancy raising practices required to provide replace-
and making the aging population in need of more ment/upgrade costs for outdated equipment and
healthcare, which, in turn, increases the cost of facilities. In many hospitals, specifically older
healthcare services. Accordingly, policymakers hospitals, a lot of capital is needed to upgrade the
are increasingly motivated to reduce healthcare existing physical space, including facilities and
costs (11). equipment, reduced liquidity and increased the
Numerous studies have been conducted on debt ratio with financial problems, and the bank-
healthcare cost control over the past three dec- ruptcy of these hospitals. Therefore, funding
ades, and various economic models have been seems to be essential for healthcare organiza-
developed for this purpose, especially in hospi- tions, especially hospitals (21).
tals. These models are more focused on cost Performance-based budgeting (also called pro-
structure, cost-effectiveness analysis, cost-utility gram budgeting) is another budgeting approach
analysis, and cost-benefit analysis. Numerous that has recently gained popularity. It is a plan-
measures have been taken to control the cost of ning, budgeting, and evaluation system that em-
healthcare systems and organizations in recent phasizes the association between budget spent
years, including changing accounting approaches, and outcomes. It has been widely discussed in the
a modified approach to budgeting, and service budgeting literature. This approach has certain
cost control in hospitals and other healthcare or- features, such as flexible budgeting associated
ganizations (12). with performance goals and program outcome
Among the constraints that healthcare organiza- measures (22).
tions, including hospitals, both in the public and Despite all efforts to improve budgeting practices
private sectors, grapple with is budgetary con- in the healthcare systems and organizations, the
straints (13). Therefore, cost control and resource healthcare system still seems to suffer from in-
management should be considered in healthcare creased costs and inefficient resource utilization.
organizations under such circumstances. They We aimed to explore budgeting methods, dimen-
need to consider budget/resource management sions, and strengths and weaknesses, as well as to
such that the quality of healthcare services is not provide several solutions to improve it.

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 Iran J Public Health, Vol. 52, No.9, Sep 2023, pp.1889-1901

Methods Med, Web of Science, and Scopus databases were

used. The period of studies was from 1990-2022.
We aimed to identify methods of budgeting in The final papers were selected for inclusion in a
healthcare systems and organizations as a system- three-step process. In the first step, the titles of
atic review. For this purpose, the keywords Hos- all articles were reviewed, and articles unrelated
pital OR teaching hospital OR poly clinic OR to the research subject were excluded. In the sec-
clinic OR public hospital OR non-profit hospital ond stage, the abstracts were studied, and irrele-
OR health OR health system OR health care sys- vant articles were excluded. Finally, the remaining
tem OR healthcare OR health service OR articles were read in full text, and articles tailored
healthcare service AND budget OR budgeting to the research purpose were included in the
OR budgeting model OR cost estimation OR study.
income estimation OR revenue estimation OR
financial management OR capital budgeting OR Inclusion and exclusion criteria
global budgeting OR periodic financial forecast 1- Articles and reports published from 1990-2022
OR resource allocation OR budget planning OR 2- Studies written in Persian or English
budget process OR budget format OR budget 3- Articles and reports on budgeting in the
framework OR budgeting planning OR opera- healthcare system or healthcare organizations
tional budgeting OR operational budgeting mod- 4- Articles and reports on the budgeting process,
el OR budget forecast OR operational based budgeting approaches, and their strengths and
budgeting OR zero based budgeting OR budget- weaknesses
ing component OR operational budgeting com- Articles that did not have the above characteris-
ponent OR performance budgeting OR person- tics were excluded from the study.
nel budgeting OR equipment budgeting OR em-
ployee budgeting OR budget allocation OR zero Data extraction/analysis method
based budget OR contract-based budgeting OR To extract and analyze the data, a form was de-
performance-based budgeting OR budgeting signed by the researcher to define budgeting
steps OR activity-based budgeting OR popula- methods proposed in the literature and to identi-
tion budgeting OR facility budgeting OR case- fy their strengths, weaknesses, and dimensions.
mix budgeting OR global budgeting OR line by The information on each budgeting method was
line budgeting OR policy budgeting OR project then put on the form. Fig. 1 illustrates the article
budgeting, as well as the Google Scholar, Pub selection process:

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 Homauni et al.: Budgeting in Healthcare Systems and Organizations …

Total number of articles

found in the database: 2554

The number of articles that have been

removed due to being repeated: 57

Total number of article titles

studied: 2497

The number of irrelevant articles

excluded from the research after
reading the title: 2121

The number of remaining

articles whose abstract
should be read: 376

The number of irrelevant articles

excluded from the research after
reading the abstract: 280

The number of remaining

articles that should be read in
full text: 96

The number of articles whose full text was not

available: 17
The number of studies conducted in all organizations
except for healthcare organizat ions: 8
Insufficiently connected to the research purpose: 38

Total number of articles

included in the study: 33

Fig. 1: article selection process

Results Overall, 33 articles were included in the study for

extraction and final analysis. Table 1 lists various
budgeting methods identified in the literature:

Table 1: Various methods of budgeting in healthcare systems

No. Budgeting type No. %

1 Global budgeting 12 36.4
2 Healthcare system budg- 10 30.3
eting
3 Performance-based budg- 7 21.2
eting
4 Capital budgeting 4 12.1
Total 33 100

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 Iran J Public Health, Vol. 52, No.9, Sep 2023, pp.1889-1901

Budgeting in healthcare systems

To ensure health budgeting is in line with health intentional bias (upward bias and reciprocity bi-
priorities, health planning beneficiaries must be as), and blame avoidance approach (28).One of
strategically involved in the process and be pre- the possible errors when budgeting is mere cost
pared to support it (23). Department and operat- control and disregarding service quality. Cost
ing unit managers in healthcare organizations are control is a double-edged sword, leading to a de-
regarded as the main budget-makers (budgeteers) cline in service quality and customer dissatisfac-
of these organizations, involved in budgeting tion (29).
(24). A standard budget cycle consists of four Budget performance feedback should be provid-
phases: ed to managers and officials periodically so that
Preparation and submission; they can timely identify budget variance and
Approval (authorization); modify their performance (26). Budgeters should
Execution; consider their stakeholder satisfaction when
Audit and evaluation (authorization) (25). budgeting because stakeholders are the organiza-
The following principles must be followed for tion's key customers whose dissatisfaction can
successful budget planning and execution in significantly damage the organization (30).
healthcare systems and organizations: Among the criteria used in the studies are nation-
Employees' and managers' participation in the al priorities (preferences), essential services, his-
budgeting process can enhance their commit- torical budget, health needs, the feasibility analy-
ment to budget execution (26).Part of the budg- sis of international priorities (preferences), per-
eting process should be delegated to managers to sonal relationships, and generation of income
do budgeting with their employees' assistance (31).
(27).The need for identifying and preventing var- Table 2 lists the methods/approaches identified
ious biases in the budgeting process in hospitals in a healthcare system as well as the dimen-
and healthcare organizations, including uninten- sions/characteristics and practical results of im-
tional cognitive bias (due to cognitive errors, in- plementing each of them.
formation asymmetry, and limited information),

Table 2: Budgeting methods/approaches in the healthcare system

Budgeting Characteristics Practical results

type
Global budg-  Allocating a certain part of the budget for a certain  Failure to contribute to reducing
eting period (usually one year) to a certain population rather hospital services or increasing prima-
than fixed rates for certain services or items (32) ry care visits among service users af-
 Determining the volume/total cost of services provid- ter two years have passed since the
ed (32) application of this method in Mary-
 Administrative mechanism management using a spe- land Hospital (16)
cific type of contract; volume, price, service type, and  Most physicians developed a negative
its quality must be specified in this contract (17) . view of certain cost control measures
 Lowering costs for the healthcare organization (33) based on global budgeting in 110
 More flexible than the line- items method (34) hospitals in China. This can be at-
 Applied for cost control and increased health offi- tributed mainly to concerns about the
cials' authority regarding it (17) effects of these measures on physi-
 Motivating service providers to enhance the efficien- cians' healthcare performance and pa-
cy of non-medical activities, causing the payer to tient satisfaction. Cost control
measures with a significant impact on

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 Homauni et al.: Budgeting in Healthcare Systems and Organizations …

avoid their justification of activities (33). physicians' performance included

 Potentially reduced service quality due to the budget lowering the average prescription
ceiling (35) drug costs for outpatients as well as
 This method can be employed as an independent tool limiting access to examinations, med-
to strengthen budget structure sustainability (17). ications, and surgeries. Decreased pa-
 Compatibility with population-based payment (PBP) tient satisfaction was associated with
methods, e.g., shared savings (32) lower admission of patients with de-
 Reduced hospital's motivation to increase service teriorating conditions, reduced usage
volume (33) of commercial drugs, and increased
 Financial risk on the service provider side in full (34) total patient costs due to increased
 Motivating hospitals and other organizations to im- referrals (36).
prove service efficiency and Creating cost predicta-  In Taiwan, hospital wards that used
bility for healthcare payers/policymakers (33) more drugs as part of their regular
 Simple to implement (34) healthcare increased their prescrip-
 Reducing competition between hospitals and failing tion drug costs following the gov-
to determine rewards to increase hospital market ernment's implementation of global
share (33) budgeting in hospitals. Group thera-
 Payers may base allowances for annual budget in- py departments also increased the av-
creases on factors unrelated to health, such as erage monthly cost of medication in
growth in inflation or GDP, or on budgetary con- each case following the introduction
straints outside of the healthcare sector, thereby of the global budget system in 2002
eroding the global budget's purchasing power (33) . (37).
 Ability to combine administrative simplification with  Experimental results indicate that
strong motives to enhance performance; here, real global budgeting has failed to en-
progress can be achieved cost-effectively by obtain- hance the efficiency of Taiwanese
ing less complex information (32). hospitals (38).
 While global budgeting is an effective
tool for curbing costs, severe finan-
cial stress can result in unintended
consequences, including impaired
quality, due to the altered perfor-
mance of service providers following
financial rewards (35) .
 GB can help reduce healthcare costs
and increase healthcare quality com-
pared to the FFS method. While ser-
vice volume, length of hospital stays,
and monthly hospital admissions de-
creased, the number of drugs per an-
tibiotic treatment case remained un-
affected (39).
 A significant reduction in emergency
admissions accompanied the imple-
mentation of global budgeting in
Maryland compared to hospitals un-
der the payment service structure
(40).
 In Taiwan, the global budget system
was associated with longer hospital
stay lengths, increased healthcare

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 Iran J Public Health, Vol. 52, No.9, Sep 2023, pp.1889-1901

costs, and improved healthcare quali-

ty for patients treated for acute pan-
creatitis (41).
Capital  Capital budgeting is the summarized financial state-  A small sample of US hospitals sug-
budgeting ments of investment in fixed assets (42). gests that applying capital budgeting
 The repayment method is the main criterion for techniques is problematic. The most
evaluating long-term investment projects in the important concern is probably the
hospital (43) prioritized repayment, by which total
 A significant number of hospitals whose approaches return on investment (ROI) and time
seem to be dealing incorrectly with the effects of in- value of money (TVM) are explicitly
flation (42). ignored in the budgeting decision
 To implement capital budgeting, the discounted processes (42).
cash flow (DCF) method of valuation has been  A significant number of hospitals
widely utilized with negligence, such as net present whose approach seems to be dealing
value (NPV) and internal rate of return (IRR) meth- incorrectly with the effects of infla-
ods. Detailed instructions on their usage are availa- tion and the use of discount rates that
ble (43). seem excessive (42).
 As one of the errors that occurred during capital  As hospitals are likely to take ad-
budgeting implementation, the management com- vantage of the many financial re-
pares the project revenue with the status quo, while sources available to fund their gen-
it is unacceptable to apply this approach in the cur- eral capital budget, the projects they
rent situation under which we see intense competi- evaluated are expected to cover the
tion and rapid technological changes. There is also different average cost of capital (aka
a strong desire for measurable aspects of projects the weighted average cost of capital
compared to intangibles, benefits, and costs (42). (WACC)). WACC refers to the rate
 Among the items that need to be considered in at which obstacles must be over-
capital budgeting are unrealistic assumptions on re- come before being accepted by the
investment rate and inflation effects accounting finance team and implemented by
(42). the company (44).
 A capital budgeting problem in hospitals is the  In the aftermath of the COVID-19
prominent role played by physicians in accepting or global crisis, multihospital systems
rejecting investment offers because they are not li- appear to have been more successful
able for subsequent losses. Thus, the hospital man- in project management and less
agement should make the necessary decisions re- damaged than smaller hospitals (44).
gardless of the physicians' desire for venture pro-
jects (21).
 Decisions are made on choosing a project as a
hospital investment because direct cash flows from
the project are more than investment costs in do-
mestic investment, and there is sufficient cash flow
to cover costs in foreign investment (44).
Performance-  In performance-based budgeting, the budget allo-  Despite the many benefits of im-
based budg- cated to each activity is determined based on its plementing a performance-based
eting purpose and outcome rather than the previous budgeting approach, there have
year's expense (45) been some reports of failure to im-
 Performance-based budgeting is a useful tool for plement this approach successfully.
aligning planning and budgeting (46). Unsuccessful implementation of this
 This budgeting method's technical elements are set- method can be attributed to several
ting short-term, medium-term, and strategic goals reasons; for example, budgetary and
(46). executive institutions operate quite

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 Homauni et al.: Budgeting in Healthcare Systems and Organizations …

 One of the most important advantages is the high- separately in many cases, leading to
er flexibility of this budgeting method than other disharmony and disruption of budg-
methods. Other benefits include participatory et execution. To solve this problem,
management in the budgeting process increasing planning and budgeting institutions
commitment to budget execution (47). must be integrated and act in full
coordination (48).
 Another reason for disrupted per-
formance-based budgeting in
healthcare organizations/systems is
the rapidly changing planning and
budgeting environment. In many
cases, goal-setting is not performed
due to a lack of reliable data; in-
stead, it is conducted by key stake-
holders involved, including the top-
down approach (49).
 The last reason for the poor im-
plementation of performance-
based budgeting, addressed in rele-
vant studies, is the failure to update
the hospital financial management
system to implement this method
(50)
 Four requirements must be met to
implement the above system in
hospitals and healthcare organiza-
tions in Iran:
1- The accounting approach shifting
from cash to accrual
2- Developing a cost price system
3- Implementing performance-based
budgeting
4- Productivity management, evidence-
based analysis, and decision making (51)

Discussion satisfaction was associated with decreased admis-

sion of patients with deteriorating conditions,
This study analyzed the different budgeting decreased access to commercial drugs, and in-
methods used in healthcare systems. Various creased patients' total cost due to an increased
studies have examined the method of global number of referrals (36). In Berenson study,
budgeting. In Roberts study, the application of maintaining services quality through executing
the global budgeting method does not directly global budgeting was emphasized As Petrou
affect the increase of primary healthcare and the study, also global budgeting execution must be
decrease of hospital services (16). Cost control accompanied by explicit service coverage guide-
measures resulting from the global budget with a lines (33). In Dredge Report, the benefits of
significant impact on physician performance in- global budgeting were introduced, which in this
cluded lowering the average prescription drug sense is consistent with Petrou study. As in the
costs for outpatients and limiting access to exam- previous study, this study also discussed applying
inations, drugs, and surgeries. Decreased patient historical, normative, and per capita approaches.

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 Iran J Public Health, Vol. 52, No.9, Sep 2023, pp.1889-1901

This study enumerates other benefits of global ble number of hospitals whose approach seems
budgeting, including the elimination of inessential to be incorrectly dealing with the effects of infla-
services and improved service coordina- tion. On the other hand, sample hospitals seem
tion/planning, in addition to its previous benefits to be aware of the need for tangible and intangi-
(32). ble costs/benefits (42).
Global budgets can provide strong financial in- Physicians have an important role in developing
centives for cost control. Properly structured, the and validating offers in most healthcare systems.
global budget can guarantee some degree of fi- Physicians who play do not significantly contrib-
nancial stability for hospitals, especially in rural ute to the success of their preferred hospital, di-
areas. This study also enumerates global budget- rect investment costs, and budget deficit com-
ing services, including covered services, covered pensation do not affect healthcare systems in
patient population, solutions to ensure third- multiple institutions (21).
party payer participation, base year budgeting As hospitals are likely to benefit from multiple
method, updating base year budget in the next funding sources to meet their general capital
taxable years, identifying any base budget adjust- budget, the projects evaluated by them are ex-
ment, budget management method. The mecha- pected to cover the average cost of capital (called
nism for calculating market share changes, moni- weighted average cost of capital (WACC)).
toring hospital performance and the general sys- WACC refers to the rate at which obstacles must
tem, and developing/implementing a contract be overcome before being accepted by the fi-
between the global budget hospitals and the insti- nance team and implemented by the company.
tution (s) that administer the global budget sys- The severity of the COVID-19 crisis is likely to
tem. One research suggestion was that pay for be much greater in smaller hospitals with less ac-
performance (P4P) could be increased by imple- cess to different financial resources rather than
menting supplemental incentive programs to en- larger hospitals or hospital systems likely to have
sure that service quality is not compromised by significant financial resources and good relation-
providers trying to control prices (34). ships with financial service providers for financ-
GB could further contribute to reducing ing (44).
healthcare costs and increasing healthcare quality Another approach to budgeting is performance-
compared to FFS. Regarding service volume, based budgeting. In this approach, the technical
while the length of stay (LOS) and monthly hos- elements of performance-based budgeting are
pital admissions decreased the number of drugs setting short-term, medium-term, and strategic
in each case and cases containing antibiotics re- goals. In the early 2000s, the International Mone-
mained unchanged (39). Moreover, executing tary Fund (IMF) and the World Bank (WB) de-
global budgeting in Maryland was associated with fined the Medium Term Expenditure Framework
ED admissions significantly reduced compared to (MTEF) as a framework for guiding public sector
hospitals under payment service structure (40). planning and budgeting, especially in low- and
Although the results of another study showed middle-income countries. One of the lessons
that, the global budget system was associated learned from the Kenyan experience is that
with longer length of stay, higher healthcare LMICs that adopt PPBs should develop clear
costs, and higher healthcare quality in patients guidelines for implementing and updating finan-
treated for acute pancreatitis (41). cial management systems to align with the PBB
Another approach to budgeting is capital budget- framework (46). The importance of MTEF in
ing, addressed in four studies, the results of Ho performance-based budgeting was addressed (3).
study showed that the repayment method was the It is difficult to align planning and budgeting in
main criterion for evaluating long-term hospital Kenya. This can be attributed to several factors,
investment projects in a sample of small hospitals including poor oversight of the Ministry of
in the United States. There are also a considera- Health and Medical Education, institutionalized

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 Homauni et al.: Budgeting in Healthcare Systems and Organizations …

segregation of rapidly changing plan- Kenya, delegation of authority allows local priori-
ning/budgeting, planning and budgeting envi- tization and public participation in planning and
ronments, lack of reliable goal-setting data, and budgeting in the healthcare sector, leading to an
poor involvement of key stakeholders in the pro- increase in equal opportunities for local resource
cess. Including a top-down approach to goal- allocation. In this study, health policymakers were
setting. Increasing the effectiveness of perfor- recommended to develop a broad understanding
mance-based budgeting requires the institutional of countries' political context while designing and
integration of planning and budgeting processes implementing technical strategies for decentraliz-
into a shared cycle/framework with shared re- ing the healthcare sector (27). In the budgeting
porting lines, data recovery, and local input for process, providing budget feedback to depart-
information on appropriate and realistic settings ment/unit managers and supervisors is second
(49). only to participation. Since budget feedback in-
Flexibility with responsiveness, are the key fea- formation is effective in monitoring, controlling,
tures of performance-based budgeting. Public and encouraging budget managers, budget feed-
healthcare budgets and expenditures could be back will positively affect managers' budget in-
categorized and clearly described descriptively. A centives (sense of success and promotion). The
framework can also be provided to support pro- presence of a division manager in budgetary
gram budgeting and performance measurement. planning indicates the high capability of the or-
Public health policymakers/specialists may then ganization for budget execution. In addition, the
initiate an important discussion to prioritize ac- advice of the division manager and the considera-
tions and outcomes (50). tion of his views in budgetary planning will lead
The steps of setting up a performance-based to an increase in the positive/acceptable attitude
budgeting system were described, including towards budget participation, which will have a
changing the accounting approach from cash to positive effect on the budget incentive (24).
accrual, developing a cost price system, executing The stages of budgeting in healthcare systems in
performance-based budgeting, productivity man- Ghana were described in Arthur study, including
agement, evidence-based analysis, and decision informing the goals, identifying limiting factors,
making (47). Moreover, despite adequate admis- initial budgeting based on goals and limiting fac-
sion and cost-effective execution of perfor- tors, budget negotiation (a participatory process),
mance-based budgeting, Shiraz University of budget approval, budget participation, and budg-
Medical Sciences (SUMS) lacks the necessary ca- et management (29).
pabilities and authority. SUMS lacked sufficient Eight budgeting methods in healthcare organiza-
infrastructure to execute performance-based tions, including population-based, facility-based,
budgeting while conducting research (51). case mix-based, global, line-by-line, policy-based,
project-based, and ministerial discretion. (31).
Budgeting in healthcare systems The following conclusions were drawn from a
Managers and heads of operational units and de- study:
partments are considered the main decision- - Hospital-level prioritization can be improved by
makers of hospitals that should be involved in aligning budgeting and planning, combining the
the budgeting process (28). The involvement of clear role of decision-making structures, and ap-
budget executors in budgeting was also discussed plying explicit and formal decision-making crite-
in one study (25). The importance of participa- ria.
tion in budgeting was discussed in another study. - Hospital-level prioritization methods can be
The budget participation (followed by budget improved in terms of efficiency and equality in
control and feedback) and budget complexity had decision making and yielding intermediate results,
the greatest and least impact on budget perfor- including stakeholder satisfaction/understanding,
mance in Kenyan state-owned hospitals (26). In changed priorities, and implemented decisions.

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 Iran J Public Health, Vol. 52, No.9, Sep 2023, pp.1889-1901

- Cooperation includes the following conditional Acknowledgements

democratic principles: participa-
tion/empowerment of stakeholders, transparen-
cy, use of evidence, reconsideration, and applica- We are grateful to the study participants for their
tion/combination of community values. It can time and viewpoints. This study was not support-
improve hospital-level prioritization practices ed by any financial sources
(23).
Conflict of interest
Conclusion
The authors declare that there is no conflict of
interest.
The healthcare system is one of the most expen-
sive sectors in any country; therefore, it is neces-
sary to monitor closely this sector's costs. The References
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