Healthcare Reimbursement Mid-Term
Exam Questions and Correct Answers
ICD-10-CM ✅The coding system that is used primarily for reporting diagnoses for
hospital inpatients
CPT ✅coding systems created for reporting procedures and services performed by
physicians in clinical practice?
WHO ✅ICD is maintained by
lessons learned from RAC demonstration ✅-RACs are able to find large volume of
improper payments
-Overpayments collected were significantly greater than the programs costs
-Providers do not appeal every overpayment determination
- RACs willing to spend time on provider outreach activites , developing strong
relationships with provider organizations
- It is administratively possible to have a RAC work closely with a medicare claims
processing contractor
- RAC efforts did not disrupt medicare or law enforcement anti-fraud activites
- IT is possible to find companies willing to work on a contingency fee basis
HCPCS ✅Medical surgical supplies
OIG elements of effective compliance plan ✅-Written policies and procedures
-Designation of a compliance office
-education and training
-Communication, auditing and monitoring
-disciplinary action and corrective action
Three parties in healthcare situation ✅First: Patient/person responsible for bill
Second: Physician/hospital rendering care
Third: payer/insurance company
Compare UCR and CPR ✅UCR is usual, customary, and reasonable payment and
was employed by private insurance companies. The CPR approach—customary,
prevailing, and reasonable—was the system used by Medicare prior to the RBRVS
schedule. Both were discounted fee-for-service payments that attempted to control
healthcare costs before the era of prospective payment systems.
Two purposes of managed care ✅One purpose of managed care is to reduce
healthcare costs that are reimbursed by third parties. This is accomplished by requiring
prior approval for surgery and by requiring insureds to make partial payment for
, services. The other purpose of managed care is to ensure the continuing quality of care.
Advocates of managed care argue that quality of care is enhanced under this system
because unwarranted procedures are not performed or reimbursed.
Why have many insurers replaced retrospective health insurance plans with group plans
such as HMOs and PPOs? ✅In retrospective payment methods, the insurer learns of
the costs of health services after providers give patients care, and the third-party payer
is at risk. To control financial risk, insurers have replaced retrospective and fee-for-
service systems with hybrid plans and managed care plans such as HMOs, POSs, and
PPOs.
What are advantages of capitated payments for providers and payers? ✅The
advantage of capitated payment for providers is having a guaranteed customer base for
a practice or facility. The advantage for third-party payers is knowing the cost of
reimbursable services.
How do third-party payers set per-diem payment rates? ✅Third party-payers use
historical data such as dividing total costs for all prior inpatients by their LOS.
Describe the major benefits of episode-of-care reimbursement according to its
advocates and the major concerns about episode-of-care reimbursement expressed by
its critics. ✅Advocates say that episode-of-care reimbursement rewards effective and
efficient provision of healthcare services by enabling such providers to make money
from their streamlined services. Critics say that the system creates incentives to
substitute cheaper diagnostic and therapeutic tests and services and to delay or deny
treatment.
Why is the federal government a dominant player in the healthcare sector? ✅The
federal government is a dominant player in the healthcare sector because its Medicare
program is the largest single payer for health services. Additionally, the federal
government pays about two-thirds of the costs of the joint state-federal Medicaid
program. Finally, the federal government also pays for health services for other
populations including active duty and retired military personnel and their families,
veterans, American Indians, and injured and disabled workers
Why is the constant trend of increased national spending on healthcare a concern?
✅This increased spending is a concern because money is a limited resource. As
spending on healthcare increases, the money available for other sectors of the
economy decreases.
The national health service (Beveridge) model is different from the social insurance
(Bismarck) model because the Beveridge model is financed by general revenue funds
from fiscal taxes, whereas the Bismarck model is financed by workers' and employers'
compulsory payroll contributions into sickness funds ✅True
Exam Questions and Correct Answers
ICD-10-CM ✅The coding system that is used primarily for reporting diagnoses for
hospital inpatients
CPT ✅coding systems created for reporting procedures and services performed by
physicians in clinical practice?
WHO ✅ICD is maintained by
lessons learned from RAC demonstration ✅-RACs are able to find large volume of
improper payments
-Overpayments collected were significantly greater than the programs costs
-Providers do not appeal every overpayment determination
- RACs willing to spend time on provider outreach activites , developing strong
relationships with provider organizations
- It is administratively possible to have a RAC work closely with a medicare claims
processing contractor
- RAC efforts did not disrupt medicare or law enforcement anti-fraud activites
- IT is possible to find companies willing to work on a contingency fee basis
HCPCS ✅Medical surgical supplies
OIG elements of effective compliance plan ✅-Written policies and procedures
-Designation of a compliance office
-education and training
-Communication, auditing and monitoring
-disciplinary action and corrective action
Three parties in healthcare situation ✅First: Patient/person responsible for bill
Second: Physician/hospital rendering care
Third: payer/insurance company
Compare UCR and CPR ✅UCR is usual, customary, and reasonable payment and
was employed by private insurance companies. The CPR approach—customary,
prevailing, and reasonable—was the system used by Medicare prior to the RBRVS
schedule. Both were discounted fee-for-service payments that attempted to control
healthcare costs before the era of prospective payment systems.
Two purposes of managed care ✅One purpose of managed care is to reduce
healthcare costs that are reimbursed by third parties. This is accomplished by requiring
prior approval for surgery and by requiring insureds to make partial payment for
, services. The other purpose of managed care is to ensure the continuing quality of care.
Advocates of managed care argue that quality of care is enhanced under this system
because unwarranted procedures are not performed or reimbursed.
Why have many insurers replaced retrospective health insurance plans with group plans
such as HMOs and PPOs? ✅In retrospective payment methods, the insurer learns of
the costs of health services after providers give patients care, and the third-party payer
is at risk. To control financial risk, insurers have replaced retrospective and fee-for-
service systems with hybrid plans and managed care plans such as HMOs, POSs, and
PPOs.
What are advantages of capitated payments for providers and payers? ✅The
advantage of capitated payment for providers is having a guaranteed customer base for
a practice or facility. The advantage for third-party payers is knowing the cost of
reimbursable services.
How do third-party payers set per-diem payment rates? ✅Third party-payers use
historical data such as dividing total costs for all prior inpatients by their LOS.
Describe the major benefits of episode-of-care reimbursement according to its
advocates and the major concerns about episode-of-care reimbursement expressed by
its critics. ✅Advocates say that episode-of-care reimbursement rewards effective and
efficient provision of healthcare services by enabling such providers to make money
from their streamlined services. Critics say that the system creates incentives to
substitute cheaper diagnostic and therapeutic tests and services and to delay or deny
treatment.
Why is the federal government a dominant player in the healthcare sector? ✅The
federal government is a dominant player in the healthcare sector because its Medicare
program is the largest single payer for health services. Additionally, the federal
government pays about two-thirds of the costs of the joint state-federal Medicaid
program. Finally, the federal government also pays for health services for other
populations including active duty and retired military personnel and their families,
veterans, American Indians, and injured and disabled workers
Why is the constant trend of increased national spending on healthcare a concern?
✅This increased spending is a concern because money is a limited resource. As
spending on healthcare increases, the money available for other sectors of the
economy decreases.
The national health service (Beveridge) model is different from the social insurance
(Bismarck) model because the Beveridge model is financed by general revenue funds
from fiscal taxes, whereas the Bismarck model is financed by workers' and employers'
compulsory payroll contributions into sickness funds ✅True
