HFMA - Accounting and finance Questions And Verified Guaranteed Answers.

The break-even point is the level of sales volume of a product producing the exact amount of _____________. - correct answer Contribution margin needed to cover fixed costs Overhead is a common term for - correct answer Indirect Costs Activity-based costing is - correct answer A method of determining product costs using cost drivers or activity measures that cause indirect costs to be incurred Based on the historical data of the specific institution for which the budget is intended - correct answer Negotiated Arrived at by a group or association of organizations with similar characteristics (for example, a published relative value scale). - correct answer Predetermined Based on detailed time or activity studies within a specific department of a specific institution. - correct answer Customized standards Which type of cost behavior varies more or less in direct proportion to volume? - correct answer Variable The hospital staffing for a regular acute unit is an example of - correct answer Semi-fixed or stepped variable cost The wage variance is determined by: - correct answer The "difference in the budgeted and actual average wage per hour" times the "actual paid hours." When a hospital's actual patient census is greater than budgeted, the management views this as favorable. Generally, the effect on the actual expenses being less than the budgeted amounts is: - correct answer Also favorable Which of the following is NOT a type of expense variance? - correct answer Stepped Variable Which of the following is not one of the current trends moving away from the fee for service delivery payment system: - correct answer Resource Based Relative Value System (RBRVS) Which type of payment method is intended to cover all inpatient services utilized for each procedure (e.g., joint replacement) while the beneficiary is in the hospital? - correct answer Case rate Which one of the following options is a managed care product that is easy to evaluate - correct answer Fee-for-service Healthcare providers should develop different modeling tools depending on ____________. - correct answer the reimbursement method proposed in the contract. Managed care arrangements generally result in providers: - correct answer Assuming greater financial risk for the level of services provided. Which option is NOT a general category of provider excess loss insurance? Per-Person B. Aggregate C. Carve-Out D. Quality Indicator - correct answer . Quality Indicator Which option is NOT a function of the Centers for Medicare and Medicaid Services (CMS)? .A Establishment and promulgation of clear policy on eligibility for CMS programs, coverage and reimbursement of healthcare services, standards for providers and program administration B. Administration of comprehensive agreements with contractors and states that stipulate the conditions under which CMS programs are carried out, the performance standards that must be met in their administration, and the programmatic results that are to be achieved C. Monitoring the performance of contractors and states in administering CMS programs consistent with program and performance standards, as well as the direct monitoring of healthcare providers to make sure that programmatic goals are achieved D. Regulation of federal and state legislation related to life and safety issues, business compliance, and licensure requirements. Regulatory Envi - correct answer Regulation of federal and state legislation related to life and safety issues, business compliance, and licensure requirements. Regulatory Environment and Corporate Compliance Provider Reimbursement Review Board (PRRB) - correct answer was created to conduct hearings and render decisions on certain appeals from Medicare providers. If a provider disagrees with its MAC's interpretation and application of a Medicare regulation, it can appeal the matter before PRRB when the disputed amount exceeds a minimum dollar limit. Federal Trade Commission (FTC) - correct answer The healthcare industry is required to comply with all antitrust laws and, as such, is under the enforcement of the Federal Trade Commission (FTC). The FTC has maintained an aggressive enforcement program in the healthcare field, including looking for situations where its presence can enhance competition. Internal Revenue Service - correct answer All Hospitals and health care organizations are subject to IRS regulations. For-Profit organizations must follow rules similar to organizations located in any other industry. Non-profit Hospitals and health care organizations must follow rules set forth under code section 501(c) (3) and 501 (r). Accreditation and The Joint Commission - correct answer States have adopted laws and regulations governing the granting of operating licenses to various healthcare providers. Criteria for licensure typically include physical facility requirements, the scope of services offered, the education and training standards for medical staff and employees, and minimum safety and staffing requirements. The Joint Commission periodically evaluates programs and services of hospitals Quality Improvement Organizations (QIO) - correct answer A Quality Improvement Organization (QIO) is a group of health quality experts, clinicians, and consumers organized to improve the care delivered to people with Medicare. QIOs work under the direction of the Centers for Medicare & Medicaid Services to assist Medicare providers with quality improvement and to review quality concerns for the protection of beneficiaries and the Medicare Trust Fund. Office of the Inspector General - correct answer The Office of the Inspector General (OIG) was established by Congress to identify and eliminate fraud, abuse, and waste in HHS programs and to promote efficiency and economy in departmental operations. It carries out this mission through a nationwide program of audits, investigations, and inspections. Department of Justice (DOJ) - correct answer The United States Department of Justice (DOJ) can prosecute healthcare fraud under various federal criminal statutes. The Department can also bring civil actions for damages and monetary penalties against providers who submit false or fraudulent claims for payment to the Medicare or Medicaid programs. Medicare - correct answer or all persons 65 years of age or older; Individuals with certain disabilities A federally funded and administered program of health insurance Includes four parts A, B, C, and D With the Prospective Payment System, hospital reimbursement for inpatients, with the exception of critical access hospitals, is determined prospectively Medicaid - correct answer Administered jointly by the federal and state governments In most cases the federal government matches state contributions and, thus, shares in financing these healthcare services States receive funding from the federal government based on the state's per capita income Provides health insurance mainly for the indigent Which option is NOT true concerning Medicare's Prospective Payment System? A. Hospital reimbursement for inpatients, with the exception of critical access hospitals, is primarily determined prospectively B. Hospitals assume the responsibility for treating the diagnosis with the most cost-effective use of hospital resources. C. All Medicare patients are placed into a diagnosis related group (DRG) based on their primary clinical diagnosis D. It is an accumulation of funds in the Part B trust fund occurs through premiums paid by enrollees as well as federal government subsidies. - correct answer It is an accumulation of funds in the Part B trust fund occurs through premiums paid by enrollees as well as federal government subsidies. Phase 1: Determining allowable costs - correct answer The source data needed in this phase include expenses, other operating revenues, operating gains and losses, and nonoperating gains and losses. All of these data are generally obtained from the provider's accounting records. The expense data must be sorted by department and then divided between salaries and other expenses within the department. Phase II: Cost Finding - correct answer In the second phase of the reimbursement process, the objective is to determine the total allowable cost of direct patient care departments, commonly referred to as "revenue-producing" departments. To accomplish this, the direct costs of the non-revenue-producing or general service (overhead) departments obtained in Phase I must be allocated to the revenue-producing and non-allowable departments. This process of allocation is called cost finding. Phase III: Cost Apportionment - correct answer The cost apportionment process is the determination of Medicare's share of total allowable costs of the revenue-producing departments (output of Phase II). Essentially, Medicare's share is determined based on its use of the services of each department. Generally, patient days are used to determine Medicare's utilization of routine care services, and patient revenues are used to determine its share of ancillary service costs. The output of this phase is the provider's cost reimbursable from Medicare. Phase IV: Determining Settlement - correct answer The last phase of the reimbursement process is determining the net settlement due to or from the provider. To compute the settlement, interim payments—DRG, outlier, cost-based, and other payments received or receivable from the intermediary, plus coinsurance and deductibles received or receivable from the patient—are subtracted from the provider's computed amounts for DRG, outlier, cost-based, coinsurance and deductible bad debts, and other amounts. The output of this phase is the provider's cost reimbursable from Medicare. - correct answer phase 3 The objective of this phase is to determine allowable costs by department. - correct answer phase 1 This phase of the reimbursement process is determining the net settlement due to or from the provider. - correct answer phase 4 The objective is to determine the total allowable cost of direct patient care departments, commonly referred to as "revenue-producing" departments. - correct answer phase 2 Included in s-10 worksheet - correct answer cost to charge ratio All partial payments by charity care patients Total initial charity charges State Children's Health Insurance Program (SCHIP) data Other state and local indigent care programs data Medicaid and disproportionate share hospital (DSH) data What is the requirement of the Omnibus Budget Reconciliation Act of 1989? - correct answer For hospitals to maintain records on transferred patients for five years Regarding anti-dumping, which option is necessary for a hospital to do if an emergency medical condition exists? - correct answer Provide further medical examination and treatment to stabilize the patient Organizations should have a clear plan as to why they are in business and how they can stay in business in the future. What is such a plan called? - correct answer Strategic plan Which option is NOT a control budget? A. Operating B. Capital C. Cash - correct answer Variances Which control budget places the responsibility for meeting budget targets on departmental or service managers? A. Operating budget B. Capital budget C. Cash budget D. Control budget - correct answer Operating Budget Which statistical factor is typically used by healthcare organizations in their operating budgets? - correct answer historical statistics