,TESTBANK FOR Healthcare Financial Management
Applied Concepts and Practical Analyses Henson
Notes
1- The file is chapter after chapter.
2- We have shown you few pages sample.
3- The file contains all Appendix and Excel sheet
if it exists.
4- We have all what you need, we make update
at every time. There are many new editions
waiting you.
5- If you think you purchased the wrong file You
can contact us at every time, we can replace it
with true one.
Our email:
,Healthcare Financial Management
Applied Concepts and Practical Analyses
Cassandra R. Henson, DrPA, MBA
Copyright © Springer Publishing Company, LLC. All Rights Reserved. 1
,Copyright © 2024 Springer Publishing Company, LLC
All rights reserved.
No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any
form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without
the prior permission of Springer Publishing Company, LLC, or authorization through payment of
the appropriate fees to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers,
MA 01923, 978-750-8400, fax 978-646-8600, or at www.copyright.com.
Springer Publishing Company, LLC
11 West 42nd Street, New York, NY 10036
www.springerpub.com
connect.springerpub.com
ISBN: 978-0-8261-4478-2
The author and the publisher of this Work have made every effort to use sources believed to be
reliable to provide information that is accurate and compatible with the standards generally
accepted at the time of publication. Because medical science is continually advancing, our
knowledge base continues to expand. Therefore, as new information becomes available,
changes in procedures become necessary. We recommend that the reader always consult
current research and specific institutional policies before performing any clinical procedure or
delivering any medication. The author and publisher shall not be liable for any special,
consequential, or exemplary damages resulting, in whole or in part, from the readers’ use of, or
reliance on, the information contained in this book. The publisher has no responsibility for the
persistence or accuracy of URLs for external or third-party internet websites referred to in this
publication and does not guarantee that any content on such websites is, or will remain,
accurate or appropriate.
Copyright © Springer Publishing Company, LLC. All Rights Reserved. 2
,Contents
Module I: Healthcare Industry Framework
Chapter 1: The Business of Healthcare
Chapter 2: The Healthcare Sector, Supporting Industries, and System
Organization
Chapter 3: Finance Department Structure, Function, and Roles
Module II: Accounting Principles Review
Chapter 4: Financial and Managerial Accounting
Chapter 5: General Ledger Categorization and Recording Transactions
Chapter 6: Financial Statements Analysis, Benchmarking, and Decision-Making
Module III: Healthcare Revenue Cycle Management
Chapter 7: Revenue Cycle Management: Health Insurance and Other Payment
Mechanisms
Chapter 8: Revenue Cycle Management: Cost Estimation and Rate Calculations
Chapter 9: Revenue Cycle Management: Billing, Coding, and Collections
Chapter 10: Reimbursement Mechanisms and Revenue Recognition
Module IV: Budgeting and Operations
Chapter 11: The Budgeting Process
Chapter 12: The Capital Budget, Investments, and Financing Decisions
Chapter 13: Financial Performance and Evaluation
Module V: Resource Management
Chapter 14: Human Resources and Labor Management
Chapter 15: Healthcare Supply Chain Management
Chapter 16—This chapter is intentionally omitted from the Test Bank, as the
chapter focuses on the SurgiFlex Robotic Surgery System course project.
Copyright © Springer Publishing Company, LLC. All Rights Reserved. 3
,Module I: Healthcare Industry Framework
Chapter 1: The Business of Healthcare Test Bank Questions
1. When was the Medicare Act introduced?
*A) 1965
B) 2010
C) 1935
D) 1944
Rationale: A) The Medicare Act was introduced in 1965. B) The Patient Protection and
Affordable Care Act was created and implemented in 2010. C) The Social Security Act was
enacted in 1935. D) The U.S. Public Health Service Act was adopted in 1944.
2. The Patient Protection and Affordable Care Act was created and implemented in:
*A) 2010
B) 1944
C) 1889
D) 1765
Rationale: A) The Patient Protection and Affordable Care Act was created and implemented
in 2010. B) The U.S. Public Health Service Act was adopted in 1944. C) The U.S. Public
Health Service Commissioned Corps was created in 1889. D) The first medical college was
established in 1765.
3. Which statement is NOT true about the earliest forms of public healthcare coverage? (Choose all
that apply.)
A) The machine-driven pace of production led to increased numbers of work-related injuries.
*B) Employers began to organize and demand changes be made for their employees.
C) Early unions fought for basic medical care and prepaid hospital expenses.
*D) Most employers provided company sick benefits and medical programs.
Rationale: A) It is true that the machine-driven pace of production led to increased numbers
of work-related injuries. B) Concerned for their safety, employees began to organize and
demand changes be made by their employers. C) Early unions fought for coverage of lost
wages due to injury, which later began to include basic medical care, and in some cases
prepaid hospital expenses. D) As a result of union activity, company sick benefits and
medical programs began to take shape, although most employers at that time still refused to
offer them.
4. Which is a government-sponsored health program that provides benefits to low-income patients?
*A) Medicaid
B) Medicare
C) CHAMPVA
D) TRICARE
Rationale: A) Medicaid is a government-sponsored health program that provides benefits to
low-income patients. B) Medicare is a government-sponsored health program that provides
benefits to those 65 years of age and older. C) CHAMPVA (Civilian Health and Medical
Program of the Department of Veterans Affairs) is a government-sponsored health program
Copyright © Springer Publishing Company, LLC. All Rights Reserved.
, that provides health coverage to veterans. D) TRICARE is a government-sponsored health
program that provides health benefits to members of uniformed services and their families.
5. Which of the following provides consultation to patients with limited access to care?
*A) Telemedicine
B) Electronic medical records
C) Smart watches
D) Heartrate monitors
Rationale: A) Telemedicine provides consultation to those seeking care for nonemergent
health concerns as well as those with limited access to care. B) Electronic medical records
share patient information among providers to eliminate duplicate or unnecessary care and
testing, prevent overmedication, and reduce increasingly costly internal administrative
processes. C) Smart watches allow consumers to monitor exercise results, sleeping patterns,
breathing, and so on for personal physical fitness. D) Heartrate monitors and similar devices
allow consumers to monitor exercise results, sleeping patterns, breathing, and so on for
personal physical fitness.
6. A qualitative target used as an indicator of achieving an intended outcome is:
*A) Effectiveness
B) Efficiency
C) Efficacy
D) Triple Aim
Rationale: A) Effectiveness is a qualitative target used as an indicator of achieving an
intended outcome. B) Efficiency is a quantitative target that answers the question of whether
or not the organization is providing the best possible product or service at the least possible
cost. C) Efficacy is the capacity of a given intervention under controlled conditions. D) Triple
Aim refers to the healthcare sector goals of improving the quality of patient care, maintaining
sound financial operations and viability, and addressing issues with access to healthcare
services.
7. Which of the following statements is true of a typical business structure and business processes?
(Choose all that apply.)
*A) Markers or dominant traits of success can be categorized in three categories.
*B) Securing raw materials is a key function of ongoing economic and financial activities.
C) The supplier is the foundation of an organization’s mission, vision, and values.
*D) Effective resource allocation is characterized to meet the needs of consumers.
Rationale: A) Several distinct characteristics surface as markers or dominant traits of success
that can be categorized as ongoing economic and financial activities, customer/consumer-
driven focus, and effective and efficient resource utilization. B) Securing raw materials is a
key function and process in the category of economic and financial activities. C) The
customer is the foundation of an organization’s mission, vision, and values, with customers
being internal and external to the organization. D) Effective and efficient resource allocation
is another characteristic of a business that many other industries have adopted.
8. A business entity wholly owned by one individual is:
*A) A sole proprietorship
B) A partnership
Copyright © Springer Publishing Company, LLC. All Rights Reserved.
, C) A corporation
D) A limited liability company
Rationale: A) A sole proprietorship is a business entity wholly owned by one individual. B) A
partnership is a business entity that has two or more owners and is relatively easy to form. C)
A corporation is a business entity that has been established to be separate from its owners. D)
A limited liability company is a business structure that combines the benefits of partnership
and collaboration with limited liability of a corporation.
9. Which of the following is NOT true of for-profit organizations? (Choose all that apply.)
*A) For-profit organizations maintain a tax-exempt status.
B) For-profit organizations’ financial activities are regulated by the Securities and Exchange
Commission.
*C. For-profit organizations’ financial activities are regulated by the Internal Revenue
Service.
D. For-profit organizations focus on maximizing profits for shareholders’ dividends.
Rationale: A) For-profit organizations do not have a tax-exempt status and have federal tax
obligations. B) It is true that for-profit organizations’ financial activities are regulated by the
Securities and Exchange Commission. C) Not-for-profit organizations’ financial activities
and reporting are regulated by the Internal Revenue Service. D) For-profit organizations are
investor-owned with a focus on maximizing profits for shareholders’ dividends.
10. The organization that regulates the financial activities and reporting for publicly traded for-profit
organizations is the:
*A) Securities and Exchange Commission
B) Internal Revenue Service
C) Federal Trade Commission
D) Centers for Medicare & Medicaid Services
Rationale: A) The Securities and Exchange Commission regulates the financial activities and
reporting for publicly traded for-profit organizations. B) The Internal Revenue Service
regulates the financial activities and reporting for not-for-profit organizations. C) The Federal
Trade Commission is a federal agency that protects the public from deceptive business
practices. D) The Centers for Medicare & Medicaid Services is part of the Department of
Health and Human Services.
11. The government health plan that provides health benefits to those 65 years of age and older is
called:
*A) Medicare
B) CHAMPVA
C) Medicaid
D) TRICARE
Rationale: A) Medicare provides health benefits to those 65 years of age and older. B)
CHAMPVA (Civilian Health and Medical Program of the Department of Veterans Affairs) is
a healthcare program for veterans. C) Medicaid provides health benefits to those with limited
family income. D) TRICARE provides health benefits to members of the uniformed services
and their families.
Copyright © Springer Publishing Company, LLC. All Rights Reserved.
,12. Which of the following statements is NOT true about access to healthcare services? (Choose all
that apply.)
A) Location and provider availability play a role in access to care.
*B) In urban areas, services are available due to the capacity of community providers.
C) Patients with mobility issues depend on medical transport or home healthcare services.
D) Additional providers have been added to expand services and ease wait times.
Rationale: A) Illness, location, and clinician availability all play a role in the access to care
dilemma. B) For some in urban areas, no services may be available at all if community
providers lack capacity. C) Without medical transport or home healthcare services, those with
mobility issues may go without the necessary care. D) Healthcare has added providers to
expand services and ease wait times and congestion.
13. The out-of-pocket expenses by an individual seeking healthcare services prior to the introduction
of the Medicare Act of 1965 were approximately:
*A) 80%
B) 90%
C) 100%
D) 50%
Rationale: A) Prior to the introduction of the Medicare Act of 1965 and managed care
organizations, approximately 80% of healthcare expenses were paid out-of-pocket by
individuals seeking healthcare services. B) The correct answer is 80%, not 90%. C) The
correct answer is 80%, not 100%. D) The correct answer is 80%, not 50%.
14. Which of the following is an example of a quantitative target?
A) A cardiac treatment initiative sets a target of decreasing heart disease by 50% in a specific
community or population.
*B) A cardiac treatment initiative sets a target of using the least number of resources
(financial and material).
C) Billions of dollars are wasted on inpatient procedures and screening.
D) The percentage of cases treated in a clinical trial is compared with the percentage of cases
treated in real practice.
Rationale: A) This is an example of a qualitative target. B) This is an example of a
quantitative target. C) This is an example of a qualitative target. D) This is an example of a
qualitative target.
15. Which of the following is NOT true of a partnership? (Choose all that apply.)
*A) A business entity established to be separate from its owners
B) A business entity that has two or more owners and is easy to form
*C) A business entity in healthcare that may include local neighborhood providers and
pharmacies
D) A business entity with unlimited liability
Rationale: A) A corporation is a business entity established to be separate from its owners. B)
A partnership has two or more owners and is relatively easy to form. C) A sole proprietorship
is a business entity wholly owned by one individual, which may include local neighborhood
providers and pharmacies. D) A sole proprietorship and a standard partnership have unlimited
liability.
Copyright © Springer Publishing Company, LLC. All Rights Reserved.
, 16. Which agency regulates the financial activities and reporting for not-for-profit organizations?
*A) Internal Revenue Service
B) Securities and Exchange Commission
C) Centers for Medicare & Medicaid Services
D) Managed care organizations
Rationale: A) The Internal Revenue Service regulates the financial activities and reporting for
not-for-profit organizations. B) The Securities and Exchange Commission regulates the
financial activities and reporting for publicly traded for-profit organizations. C) The Centers
for Medicare & Medicaid Services is part of the Department of Health and Human Services.
D) Managed care organizations are a group of doctors, hospitals, and other providers who
work together to meet patients’ healthcare needs.
17. Which of the following statements is true?
*A) The healthcare sector generates approximately $3.8 trillion in expenditure.
B) The healthcare sector generates approximately $3.8 million in expenditure.
C) The healthcare sector generates approximately $38 million in expenditure.
D) The healthcare sector generates approximately $3.8 billion in expenditure.
Rationale: A) The healthcare sector generates approximately $3.8 trillion. B) The correct
response is $3.8 trillion. C) The correct response is $3.8 trillion. D) The correct response is
$3.8 trillion.
18. Which of the following has the healthcare sector implemented to improve quality and access to
care? (Choose all that apply.)
*A) Increased the number of providers
*B) Accountable care organizations
*C) Bundled payments
D) Offer one single good or service
Rationale: A) The healthcare sector has implemented several changes to improve quality and
access to care, as well as reduce the price of care for the consumers, through measures such
as increased number of providers, managed care organizations, accountable care
organizations, and bundled payments. B) The healthcare sector has implemented several
changes to improve quality and access to care, as well as reduce the price of care for the
consumers, through measures such as increased number of providers, managed care
organizations, accountable care organizations, and bundled payments. C) The healthcare
sector has implemented several changes to improve quality and access to care, as well as
reduce the price of care for the consumers, through measures such as increased number of
providers, managed care organizations, accountable care organizations, and bundled
payments. D) The healthcare sector does not offer one single good or service to consumers
but offers a tremendous number of items to meet a myriad of needs.
19. Which of the following statements is true about healthcare?
*A) Competition in healthcare is usually dependent on location.
B) Competition in healthcare includes exact product producers as well as substitutes.
C) Healthcare meets specific product demand.
D) Effectiveness in healthcare is generally tied to business performance.
Rationale: A) Competition being usually dependent on location is a healthcare concept. B)
Competition including exact product producers as well as substitutes is a business concept. C)
Copyright © Springer Publishing Company, LLC. All Rights Reserved.
Applied Concepts and Practical Analyses Henson
Notes
1- The file is chapter after chapter.
2- We have shown you few pages sample.
3- The file contains all Appendix and Excel sheet
if it exists.
4- We have all what you need, we make update
at every time. There are many new editions
waiting you.
5- If you think you purchased the wrong file You
can contact us at every time, we can replace it
with true one.
Our email:
,Healthcare Financial Management
Applied Concepts and Practical Analyses
Cassandra R. Henson, DrPA, MBA
Copyright © Springer Publishing Company, LLC. All Rights Reserved. 1
,Copyright © 2024 Springer Publishing Company, LLC
All rights reserved.
No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any
form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without
the prior permission of Springer Publishing Company, LLC, or authorization through payment of
the appropriate fees to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers,
MA 01923, 978-750-8400, fax 978-646-8600, or at www.copyright.com.
Springer Publishing Company, LLC
11 West 42nd Street, New York, NY 10036
www.springerpub.com
connect.springerpub.com
ISBN: 978-0-8261-4478-2
The author and the publisher of this Work have made every effort to use sources believed to be
reliable to provide information that is accurate and compatible with the standards generally
accepted at the time of publication. Because medical science is continually advancing, our
knowledge base continues to expand. Therefore, as new information becomes available,
changes in procedures become necessary. We recommend that the reader always consult
current research and specific institutional policies before performing any clinical procedure or
delivering any medication. The author and publisher shall not be liable for any special,
consequential, or exemplary damages resulting, in whole or in part, from the readers’ use of, or
reliance on, the information contained in this book. The publisher has no responsibility for the
persistence or accuracy of URLs for external or third-party internet websites referred to in this
publication and does not guarantee that any content on such websites is, or will remain,
accurate or appropriate.
Copyright © Springer Publishing Company, LLC. All Rights Reserved. 2
,Contents
Module I: Healthcare Industry Framework
Chapter 1: The Business of Healthcare
Chapter 2: The Healthcare Sector, Supporting Industries, and System
Organization
Chapter 3: Finance Department Structure, Function, and Roles
Module II: Accounting Principles Review
Chapter 4: Financial and Managerial Accounting
Chapter 5: General Ledger Categorization and Recording Transactions
Chapter 6: Financial Statements Analysis, Benchmarking, and Decision-Making
Module III: Healthcare Revenue Cycle Management
Chapter 7: Revenue Cycle Management: Health Insurance and Other Payment
Mechanisms
Chapter 8: Revenue Cycle Management: Cost Estimation and Rate Calculations
Chapter 9: Revenue Cycle Management: Billing, Coding, and Collections
Chapter 10: Reimbursement Mechanisms and Revenue Recognition
Module IV: Budgeting and Operations
Chapter 11: The Budgeting Process
Chapter 12: The Capital Budget, Investments, and Financing Decisions
Chapter 13: Financial Performance and Evaluation
Module V: Resource Management
Chapter 14: Human Resources and Labor Management
Chapter 15: Healthcare Supply Chain Management
Chapter 16—This chapter is intentionally omitted from the Test Bank, as the
chapter focuses on the SurgiFlex Robotic Surgery System course project.
Copyright © Springer Publishing Company, LLC. All Rights Reserved. 3
,Module I: Healthcare Industry Framework
Chapter 1: The Business of Healthcare Test Bank Questions
1. When was the Medicare Act introduced?
*A) 1965
B) 2010
C) 1935
D) 1944
Rationale: A) The Medicare Act was introduced in 1965. B) The Patient Protection and
Affordable Care Act was created and implemented in 2010. C) The Social Security Act was
enacted in 1935. D) The U.S. Public Health Service Act was adopted in 1944.
2. The Patient Protection and Affordable Care Act was created and implemented in:
*A) 2010
B) 1944
C) 1889
D) 1765
Rationale: A) The Patient Protection and Affordable Care Act was created and implemented
in 2010. B) The U.S. Public Health Service Act was adopted in 1944. C) The U.S. Public
Health Service Commissioned Corps was created in 1889. D) The first medical college was
established in 1765.
3. Which statement is NOT true about the earliest forms of public healthcare coverage? (Choose all
that apply.)
A) The machine-driven pace of production led to increased numbers of work-related injuries.
*B) Employers began to organize and demand changes be made for their employees.
C) Early unions fought for basic medical care and prepaid hospital expenses.
*D) Most employers provided company sick benefits and medical programs.
Rationale: A) It is true that the machine-driven pace of production led to increased numbers
of work-related injuries. B) Concerned for their safety, employees began to organize and
demand changes be made by their employers. C) Early unions fought for coverage of lost
wages due to injury, which later began to include basic medical care, and in some cases
prepaid hospital expenses. D) As a result of union activity, company sick benefits and
medical programs began to take shape, although most employers at that time still refused to
offer them.
4. Which is a government-sponsored health program that provides benefits to low-income patients?
*A) Medicaid
B) Medicare
C) CHAMPVA
D) TRICARE
Rationale: A) Medicaid is a government-sponsored health program that provides benefits to
low-income patients. B) Medicare is a government-sponsored health program that provides
benefits to those 65 years of age and older. C) CHAMPVA (Civilian Health and Medical
Program of the Department of Veterans Affairs) is a government-sponsored health program
Copyright © Springer Publishing Company, LLC. All Rights Reserved.
, that provides health coverage to veterans. D) TRICARE is a government-sponsored health
program that provides health benefits to members of uniformed services and their families.
5. Which of the following provides consultation to patients with limited access to care?
*A) Telemedicine
B) Electronic medical records
C) Smart watches
D) Heartrate monitors
Rationale: A) Telemedicine provides consultation to those seeking care for nonemergent
health concerns as well as those with limited access to care. B) Electronic medical records
share patient information among providers to eliminate duplicate or unnecessary care and
testing, prevent overmedication, and reduce increasingly costly internal administrative
processes. C) Smart watches allow consumers to monitor exercise results, sleeping patterns,
breathing, and so on for personal physical fitness. D) Heartrate monitors and similar devices
allow consumers to monitor exercise results, sleeping patterns, breathing, and so on for
personal physical fitness.
6. A qualitative target used as an indicator of achieving an intended outcome is:
*A) Effectiveness
B) Efficiency
C) Efficacy
D) Triple Aim
Rationale: A) Effectiveness is a qualitative target used as an indicator of achieving an
intended outcome. B) Efficiency is a quantitative target that answers the question of whether
or not the organization is providing the best possible product or service at the least possible
cost. C) Efficacy is the capacity of a given intervention under controlled conditions. D) Triple
Aim refers to the healthcare sector goals of improving the quality of patient care, maintaining
sound financial operations and viability, and addressing issues with access to healthcare
services.
7. Which of the following statements is true of a typical business structure and business processes?
(Choose all that apply.)
*A) Markers or dominant traits of success can be categorized in three categories.
*B) Securing raw materials is a key function of ongoing economic and financial activities.
C) The supplier is the foundation of an organization’s mission, vision, and values.
*D) Effective resource allocation is characterized to meet the needs of consumers.
Rationale: A) Several distinct characteristics surface as markers or dominant traits of success
that can be categorized as ongoing economic and financial activities, customer/consumer-
driven focus, and effective and efficient resource utilization. B) Securing raw materials is a
key function and process in the category of economic and financial activities. C) The
customer is the foundation of an organization’s mission, vision, and values, with customers
being internal and external to the organization. D) Effective and efficient resource allocation
is another characteristic of a business that many other industries have adopted.
8. A business entity wholly owned by one individual is:
*A) A sole proprietorship
B) A partnership
Copyright © Springer Publishing Company, LLC. All Rights Reserved.
, C) A corporation
D) A limited liability company
Rationale: A) A sole proprietorship is a business entity wholly owned by one individual. B) A
partnership is a business entity that has two or more owners and is relatively easy to form. C)
A corporation is a business entity that has been established to be separate from its owners. D)
A limited liability company is a business structure that combines the benefits of partnership
and collaboration with limited liability of a corporation.
9. Which of the following is NOT true of for-profit organizations? (Choose all that apply.)
*A) For-profit organizations maintain a tax-exempt status.
B) For-profit organizations’ financial activities are regulated by the Securities and Exchange
Commission.
*C. For-profit organizations’ financial activities are regulated by the Internal Revenue
Service.
D. For-profit organizations focus on maximizing profits for shareholders’ dividends.
Rationale: A) For-profit organizations do not have a tax-exempt status and have federal tax
obligations. B) It is true that for-profit organizations’ financial activities are regulated by the
Securities and Exchange Commission. C) Not-for-profit organizations’ financial activities
and reporting are regulated by the Internal Revenue Service. D) For-profit organizations are
investor-owned with a focus on maximizing profits for shareholders’ dividends.
10. The organization that regulates the financial activities and reporting for publicly traded for-profit
organizations is the:
*A) Securities and Exchange Commission
B) Internal Revenue Service
C) Federal Trade Commission
D) Centers for Medicare & Medicaid Services
Rationale: A) The Securities and Exchange Commission regulates the financial activities and
reporting for publicly traded for-profit organizations. B) The Internal Revenue Service
regulates the financial activities and reporting for not-for-profit organizations. C) The Federal
Trade Commission is a federal agency that protects the public from deceptive business
practices. D) The Centers for Medicare & Medicaid Services is part of the Department of
Health and Human Services.
11. The government health plan that provides health benefits to those 65 years of age and older is
called:
*A) Medicare
B) CHAMPVA
C) Medicaid
D) TRICARE
Rationale: A) Medicare provides health benefits to those 65 years of age and older. B)
CHAMPVA (Civilian Health and Medical Program of the Department of Veterans Affairs) is
a healthcare program for veterans. C) Medicaid provides health benefits to those with limited
family income. D) TRICARE provides health benefits to members of the uniformed services
and their families.
Copyright © Springer Publishing Company, LLC. All Rights Reserved.
,12. Which of the following statements is NOT true about access to healthcare services? (Choose all
that apply.)
A) Location and provider availability play a role in access to care.
*B) In urban areas, services are available due to the capacity of community providers.
C) Patients with mobility issues depend on medical transport or home healthcare services.
D) Additional providers have been added to expand services and ease wait times.
Rationale: A) Illness, location, and clinician availability all play a role in the access to care
dilemma. B) For some in urban areas, no services may be available at all if community
providers lack capacity. C) Without medical transport or home healthcare services, those with
mobility issues may go without the necessary care. D) Healthcare has added providers to
expand services and ease wait times and congestion.
13. The out-of-pocket expenses by an individual seeking healthcare services prior to the introduction
of the Medicare Act of 1965 were approximately:
*A) 80%
B) 90%
C) 100%
D) 50%
Rationale: A) Prior to the introduction of the Medicare Act of 1965 and managed care
organizations, approximately 80% of healthcare expenses were paid out-of-pocket by
individuals seeking healthcare services. B) The correct answer is 80%, not 90%. C) The
correct answer is 80%, not 100%. D) The correct answer is 80%, not 50%.
14. Which of the following is an example of a quantitative target?
A) A cardiac treatment initiative sets a target of decreasing heart disease by 50% in a specific
community or population.
*B) A cardiac treatment initiative sets a target of using the least number of resources
(financial and material).
C) Billions of dollars are wasted on inpatient procedures and screening.
D) The percentage of cases treated in a clinical trial is compared with the percentage of cases
treated in real practice.
Rationale: A) This is an example of a qualitative target. B) This is an example of a
quantitative target. C) This is an example of a qualitative target. D) This is an example of a
qualitative target.
15. Which of the following is NOT true of a partnership? (Choose all that apply.)
*A) A business entity established to be separate from its owners
B) A business entity that has two or more owners and is easy to form
*C) A business entity in healthcare that may include local neighborhood providers and
pharmacies
D) A business entity with unlimited liability
Rationale: A) A corporation is a business entity established to be separate from its owners. B)
A partnership has two or more owners and is relatively easy to form. C) A sole proprietorship
is a business entity wholly owned by one individual, which may include local neighborhood
providers and pharmacies. D) A sole proprietorship and a standard partnership have unlimited
liability.
Copyright © Springer Publishing Company, LLC. All Rights Reserved.
, 16. Which agency regulates the financial activities and reporting for not-for-profit organizations?
*A) Internal Revenue Service
B) Securities and Exchange Commission
C) Centers for Medicare & Medicaid Services
D) Managed care organizations
Rationale: A) The Internal Revenue Service regulates the financial activities and reporting for
not-for-profit organizations. B) The Securities and Exchange Commission regulates the
financial activities and reporting for publicly traded for-profit organizations. C) The Centers
for Medicare & Medicaid Services is part of the Department of Health and Human Services.
D) Managed care organizations are a group of doctors, hospitals, and other providers who
work together to meet patients’ healthcare needs.
17. Which of the following statements is true?
*A) The healthcare sector generates approximately $3.8 trillion in expenditure.
B) The healthcare sector generates approximately $3.8 million in expenditure.
C) The healthcare sector generates approximately $38 million in expenditure.
D) The healthcare sector generates approximately $3.8 billion in expenditure.
Rationale: A) The healthcare sector generates approximately $3.8 trillion. B) The correct
response is $3.8 trillion. C) The correct response is $3.8 trillion. D) The correct response is
$3.8 trillion.
18. Which of the following has the healthcare sector implemented to improve quality and access to
care? (Choose all that apply.)
*A) Increased the number of providers
*B) Accountable care organizations
*C) Bundled payments
D) Offer one single good or service
Rationale: A) The healthcare sector has implemented several changes to improve quality and
access to care, as well as reduce the price of care for the consumers, through measures such
as increased number of providers, managed care organizations, accountable care
organizations, and bundled payments. B) The healthcare sector has implemented several
changes to improve quality and access to care, as well as reduce the price of care for the
consumers, through measures such as increased number of providers, managed care
organizations, accountable care organizations, and bundled payments. C) The healthcare
sector has implemented several changes to improve quality and access to care, as well as
reduce the price of care for the consumers, through measures such as increased number of
providers, managed care organizations, accountable care organizations, and bundled
payments. D) The healthcare sector does not offer one single good or service to consumers
but offers a tremendous number of items to meet a myriad of needs.
19. Which of the following statements is true about healthcare?
*A) Competition in healthcare is usually dependent on location.
B) Competition in healthcare includes exact product producers as well as substitutes.
C) Healthcare meets specific product demand.
D) Effectiveness in healthcare is generally tied to business performance.
Rationale: A) Competition being usually dependent on location is a healthcare concept. B)
Competition including exact product producers as well as substitutes is a business concept. C)
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