NUR 425 Exam 3 Practice Questions and
Solutions
3 Primary Sources that Pay for Healthcare ✅Government (Medicare & Medicaid),
private health insurance (through your job), and out-of-pocket (includes deductibles,
copayments, and anything paid by the individual)
Medicare Part A ✅Federal program that is the insurance plan for hospital, hospice,
home health, and skilled nursing care paid through with social security taxes. Nursing
home care is NOT covered.
Medicaid ✅State level programs funded by state and federal. Pays for services for the
blind, disabled, medically indigent, children with disabilities and covers a lot.
Cost-Based System ✅Consists of the cost of providing a service plus an additional
cost for profit. Third party payers costs decided by surveying a certain area, and
payment is selected after the service is provided.
Contractual Allowance ✅Given when reimbursed amount is less than the full charge of
service in a cost-based system because it is similar to a "discount" for the third party
payer.
Prospective Payment System ✅Third-party payer decides what and how much will be
paid for a service. If the cost of care is higher than the payment, the provider absorbs
the loss. Profit is made when the cost of care is lower.
Diagnosis Related Groups ✅Basis of payment in the Prospective Payment System
which groups people based on their diagnosis on their average hospital stay, lab costs,
surgeries, therapies, etc. Does not accurately reflect patient intensity or acuity. PPS with
DRG caused increased patient acuity and decreased length of stay in hospitals
Value Based Purchasing/Pay-for-Performance ✅Reimbursed based on performance
and outcomes versus rather than considering the cost of providing certain care. Based
on quality outcomes, staff responsiveness, cleanliness, quietness of hospital
environment
Capitation ✅Form of Prospective Based Payment. It is a Decided amount of what will
be paid per patient per days, not based on the procedure. There is a profit when the
stay is shorter for patients.
Nurse's Role in Capitation ✅Nurse must strive to do more in a visit to prevent return
visits and complications as they are working on only a set amount of days that is being
, paid for. They need to complete care under the set amount of paid days for the
company to make a profit
Nurse's Role with Case Management ✅Knowledge of patient goals and anticipated
discharge date. Appropriate and timely interventions when the patient isn't progressing
as expected. Ongoing patient and family education. Identifying barriers to discharge.
Operating Budget Defined ✅Financial plan generated from daily operations which
takes into account a day's personnel, supply, expenses, and revenue. THE EXPENSE
PORTION is the most time consuming. More specifically, personnel is determined with
unit of service
Unit of Service ✅Essentially, it is personnel on the unit. Contains nurse to bed ratios,
acuity, and type of staff (RNs, LPNs). Predicts the volume of work required, and the
personnel budget is established from there
Full-Time Equivalents (FTEs) ✅Used when determining personnel budgets and
simplifying who works full-time and part-time but not considering their roles. Full time
equivalents are 2,080 paid hours per year which can be productive and nonproductive
Productive vs. Nonproductive Hours ✅Productive= paid time that is worked
Nonproductive=paid time that is not worked (PTO, vacation, orientation, sick time)
Capital Expenditure Budget ✅reflects expenses related to the purchase of major
capital items such as equipment and physical plant. The capital expenditure must have
a useful life of more than one year (usually 1-5 years) and must exceed the
organization's cost. Kept separate from the operating budget because the high cost
would be reflected in the cost of patient care, also showing way too high
Variance Defined ✅Difference between the projected budget & the actual performance
for a particular account. Positive (favorable) variance means that the budget was larger
than the actual amount spent
Position Descriptions provide... ✅Written guidelines detailing the roles and
responsibilities of a specific position
Behavioral Interviewing Purpose and Example ✅Requires applicants to describe a
situation that happened to them and how they handled it. For example, stating how the
reacted to a conflict with another employee.
Empowerment Strategies ✅Process that acknowledges the values and judgement of
individuals and trusts them to make correct decisions. Useful in professional and
organizational development
Solutions
3 Primary Sources that Pay for Healthcare ✅Government (Medicare & Medicaid),
private health insurance (through your job), and out-of-pocket (includes deductibles,
copayments, and anything paid by the individual)
Medicare Part A ✅Federal program that is the insurance plan for hospital, hospice,
home health, and skilled nursing care paid through with social security taxes. Nursing
home care is NOT covered.
Medicaid ✅State level programs funded by state and federal. Pays for services for the
blind, disabled, medically indigent, children with disabilities and covers a lot.
Cost-Based System ✅Consists of the cost of providing a service plus an additional
cost for profit. Third party payers costs decided by surveying a certain area, and
payment is selected after the service is provided.
Contractual Allowance ✅Given when reimbursed amount is less than the full charge of
service in a cost-based system because it is similar to a "discount" for the third party
payer.
Prospective Payment System ✅Third-party payer decides what and how much will be
paid for a service. If the cost of care is higher than the payment, the provider absorbs
the loss. Profit is made when the cost of care is lower.
Diagnosis Related Groups ✅Basis of payment in the Prospective Payment System
which groups people based on their diagnosis on their average hospital stay, lab costs,
surgeries, therapies, etc. Does not accurately reflect patient intensity or acuity. PPS with
DRG caused increased patient acuity and decreased length of stay in hospitals
Value Based Purchasing/Pay-for-Performance ✅Reimbursed based on performance
and outcomes versus rather than considering the cost of providing certain care. Based
on quality outcomes, staff responsiveness, cleanliness, quietness of hospital
environment
Capitation ✅Form of Prospective Based Payment. It is a Decided amount of what will
be paid per patient per days, not based on the procedure. There is a profit when the
stay is shorter for patients.
Nurse's Role in Capitation ✅Nurse must strive to do more in a visit to prevent return
visits and complications as they are working on only a set amount of days that is being
, paid for. They need to complete care under the set amount of paid days for the
company to make a profit
Nurse's Role with Case Management ✅Knowledge of patient goals and anticipated
discharge date. Appropriate and timely interventions when the patient isn't progressing
as expected. Ongoing patient and family education. Identifying barriers to discharge.
Operating Budget Defined ✅Financial plan generated from daily operations which
takes into account a day's personnel, supply, expenses, and revenue. THE EXPENSE
PORTION is the most time consuming. More specifically, personnel is determined with
unit of service
Unit of Service ✅Essentially, it is personnel on the unit. Contains nurse to bed ratios,
acuity, and type of staff (RNs, LPNs). Predicts the volume of work required, and the
personnel budget is established from there
Full-Time Equivalents (FTEs) ✅Used when determining personnel budgets and
simplifying who works full-time and part-time but not considering their roles. Full time
equivalents are 2,080 paid hours per year which can be productive and nonproductive
Productive vs. Nonproductive Hours ✅Productive= paid time that is worked
Nonproductive=paid time that is not worked (PTO, vacation, orientation, sick time)
Capital Expenditure Budget ✅reflects expenses related to the purchase of major
capital items such as equipment and physical plant. The capital expenditure must have
a useful life of more than one year (usually 1-5 years) and must exceed the
organization's cost. Kept separate from the operating budget because the high cost
would be reflected in the cost of patient care, also showing way too high
Variance Defined ✅Difference between the projected budget & the actual performance
for a particular account. Positive (favorable) variance means that the budget was larger
than the actual amount spent
Position Descriptions provide... ✅Written guidelines detailing the roles and
responsibilities of a specific position
Behavioral Interviewing Purpose and Example ✅Requires applicants to describe a
situation that happened to them and how they handled it. For example, stating how the
reacted to a conflict with another employee.
Empowerment Strategies ✅Process that acknowledges the values and judgement of
individuals and trusts them to make correct decisions. Useful in professional and
organizational development
