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LSUS MHA 706 EXAM/ Practice Exam Questions with Correct Answers/ Latest .
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LSUS MHA 706 EXAM/ Practice Exam Questions withCorrect Answers/ Latest 2020-2025.
The major provisions of the Patient Protection & Affordable Care Act of 2010 were?
Answer--Banning of preexisting condition coverage limitations
-Free preventative care
-Medicaid expansion
Which of the following statement(s) about the finance department a t large healthcare organizations
is/are correct?
Answer---The CFO typically reports directly to the chief executive officer (CEO)
-The CFO is usually assisted by a comptroller and treasurer
-The department is headed by the chief financial officer (CFO) (sometimes called the vice president-
finance)
In a not-for-profit hospital, the following are example(s) of a stakeholder.
Answer---Vendor
-Employee
-Community
Stockholders have all of the following right(s)...
Answer---Claim on residual liquidation proceeds
-Right of control
-A possible dividend and/or capital gains
Which of the following statements about finance accounting, and financial management is most correct?
pg. 1
,Answer--Financial management provides the theory, concepts, and tools necessary to help managers
make better financial decisions.
Healthcare Finance - ANSWER - is the practice of finance, including both accounting and financial
management, within health services (provider) organizations
Accounting - ANSWER - concerns the measurement, in financial (dollar) terms, of events that reflect the
resources, operations, and financing of an organization
Financial managment - ANSWER - provides the theory, concepts, and tools necessary to help managers
make better financial decisions
Business characteristics - ANSWER - -obtains financing from the marketplace
-uses the funds to buy assets
-operates the assets to provide goods or services
-sells the goods or services to create revenue
Pure Charity - ANSWER - refers to an undertaking for a charitable purpose only. The relief of poverty,
advancement of education, advancement of religion, promotion of health, the obtaining of good
government, and the accomplishment of that which is beneficial to the community in any other respect
are pure charities.
Primary role of finance - ANSWER - is to plan for, acquire, and utilize resources to maximize the efficiency
(and hence value) of the enterprise.
The Four C's - ANSWER - cost minimization
cash sufficiency
capital access
control of financial resources
3 categories of business organizations - ANSWER - proprietorship, partnership, and corporation (there
are also hybrid forms)
pg. 2
, Advantages of Proprietorships and Partnerships - ANSWER - ease of formation, subject to few
regulations, and no corporate income taxes.
Disadvantages to proprietorships and partnerships - ANSWER - limited life, difficult to transfer
ownership, unlimited liability, difficult to raise capital
Advantages to corporations - ANSWER - unlimited life, easy transfer of ownership, ease of raising capital
Disadvantages of corporations - ANSWER - cost of formation and reporting and double taxation for
investor-owned corporations
Limited liability partnership LLP - ANSWER - ◦Partners share general business liability, but partners are
liable only for their own malpractice actions
Limited liability company LLC - ANSWER - Members are taxed like partners
and Liability like stockholders
Professional corporation (PC) or professional association (PA) - ANSWER - Owners have benefits of
incorporation. However, still liable for malpractice. Often used by individual clinicians.
Stakeholders - ANSWER - have a (financial) interest in the business
Investor-owned corporations - ANSWER - stems from their organizational goal: shareholder wealth
maximization
Not for profit - ANSWER - is to ensure the financial viability of the organization
Characteristics for insurance - ANSWER - pooling of losses, payment only for random losses, risk transfer,
and indemnification
pg. 3
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