HFMA - Accounting and Finance Exam
Questions & Answers25
The break-even point is the level of sales volume of a product producing the exact amount of
_____________. - ANSWERS-Contribution margin needed to cover fixed costs
Overhead is a common term for - ANSWERS-Indirect Costs
Activity-based costing is - ANSWERS-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 -
ANSWERS-Negotiated
Arrived at by a group or association of organizations with similar characteristics (for example, a
published relative value scale). - ANSWERS-Predetermined
Based on detailed time or activity studies within a specific department of a specific institution. -
ANSWERS-Customized standards
Which type of cost behavior varies more or less in direct proportion to volume? - ANSWERS-
Variable
The hospital staffing for a regular acute unit is an example of - ANSWERS-Semi-fixed or stepped
variable cost
,The wage variance is determined by: - ANSWERS-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:
- ANSWERS-Also favorable
Which of the following is NOT a type of expense variance? - ANSWERS-Stepped Variable
Which of the following is not one of the current trends moving away from the fee for service
delivery payment system: - ANSWERS-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? - ANSWERS-Case
rate
Which one of the following options is a managed care product that is easy to evaluate -
ANSWERS-Fee-for-service
Healthcare providers should develop different modeling tools depending on ____________. -
ANSWERS-the reimbursement method proposed in the contract.
Managed care arrangements generally result in providers: - ANSWERS-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 - ANSWERS-. 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 - ANSWERS-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) - ANSWERS-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) - ANSWERS-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 - ANSWERS-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).
Questions & Answers25
The break-even point is the level of sales volume of a product producing the exact amount of
_____________. - ANSWERS-Contribution margin needed to cover fixed costs
Overhead is a common term for - ANSWERS-Indirect Costs
Activity-based costing is - ANSWERS-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 -
ANSWERS-Negotiated
Arrived at by a group or association of organizations with similar characteristics (for example, a
published relative value scale). - ANSWERS-Predetermined
Based on detailed time or activity studies within a specific department of a specific institution. -
ANSWERS-Customized standards
Which type of cost behavior varies more or less in direct proportion to volume? - ANSWERS-
Variable
The hospital staffing for a regular acute unit is an example of - ANSWERS-Semi-fixed or stepped
variable cost
,The wage variance is determined by: - ANSWERS-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:
- ANSWERS-Also favorable
Which of the following is NOT a type of expense variance? - ANSWERS-Stepped Variable
Which of the following is not one of the current trends moving away from the fee for service
delivery payment system: - ANSWERS-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? - ANSWERS-Case
rate
Which one of the following options is a managed care product that is easy to evaluate -
ANSWERS-Fee-for-service
Healthcare providers should develop different modeling tools depending on ____________. -
ANSWERS-the reimbursement method proposed in the contract.
Managed care arrangements generally result in providers: - ANSWERS-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 - ANSWERS-. 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 - ANSWERS-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) - ANSWERS-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) - ANSWERS-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 - ANSWERS-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).
