HFMA SET 1 Exam Questions And Answers Verified
100% Correct
What is courtesy discharge? - ANSWER "Courtesy discharge," -- discharge method
permits patients who have supplied all necessary demographic and insurance
information and settled their financial responsibility with the hospital to be discharged
without a required visit to the hospital's cashier or financial counselor.
What is an indicator of effectiveness of hospital permissions? - ANSWER The
effectiveness of the hospital's preadmission program is demonstrated by the number of
patients that are provided the opportunity to be discharged without asking the patient or
patient's representative to visit with a financial counselor
Claims adjudication includes the following: 4 things? - ANSWER Claims adjudication
includes the following:
a. Determination of benefits levels and coverage
b. Coordination of benefits
c. Subrogation of third-party liability claims
d. Generation of appropriate explanation of benefit forms
When must a provider submit encounter data? What is encounter data? - ANSWER A
capitated and at-risk provider must also submit encounter data (specific patient data) to
the managed care organizations with which it contracts.
a. Encounter data are information (financial and clinical) about healthcare services
provided to a managed care organization's enrollees. Encounter data are generally
submitted in the form of a pseudo or zero-pay claim (UB-04 or CMS 1500) and helps
the payer analyze a population's use of healthcare services and the cost of those
services.
How is encounter data used by Medicare & Medicaid? - ANSWER In addition to being
collected by commercial health maintenance organizations (HMOs), encounter data are
used by Medicare and Medicaid to analyze the effect of managed care on beneficiaries.
Submission of encounter data is required for an HMO to obtain a risk contract from
Medicare and Medicaid.
Define Financial Counseling. - ANSWER Financial counseling refers to the process of
extending credit to a patient and agreeing on a payment plan. It involves assisting the
patient in identifying other payment sources that may be available to the patient. It also
involves several activities that can take place before, during, or after a patient receives
service
,As a collection technique, financial counseling should accomplish the following four
critical tasks: - ANSWER As a collection technique, financial counseling should
accomplish the following four critical tasks:
i. Inform the patient financial obligations and provider's payment policies ii. Perform a
financial assessment to determine the patient's ability to pay iii. Evaluate applicable
alternatives such as payment options, assistance programs such as state Medicaid
programs, or free care, based on the financial assessment.
iv. Resolve pending transactions (eg. bank loans or medical assistance applications)
The twin goal of financial counseling: - ANSWER The twin goal of financial counseling:
i. The provider understands upfront a patient's ability to pay
ii. Patient understand their financial responsibility to the provider
3 Steps in the credit-granting process: - ANSWER Steps in the credit-granting
process: i. Application =Gather accurate information ii. Verification=Evaluate credit
worthiness
iii. Determination =Make a credit decision
What 4 things should be included in the patient credit application accomplish? -
ANSWER A patient's application for credit should be in the form of a patient financial
statement. This document should:
a. Stipulate what credit arrangement the patient seeks—evaluation and billing of
thirdparty insurance coverage, a 90-day payment plan, an extended monthly
payment plan, or reduction of total charges.
b. Exact income and expense information plus patient's financial assets and liabilities.
c. Proof of income, and the patient should sign the bottom of the statement
acknowledging that the credit information provided is accurate.
d. PFS departments can estimate a patient's charges by either assigning a provisional
diagnosis-related group to the case or by estimating the charges based on an average
of prior cases for the same treatment or procedure.
Describe the Verification process of the Credit Granting Process: - ANSWER Credit
Granting Process: Verification
Once a patient's credit application has been completed and signed, the PFS
department verifies insurance benefits and eligibility, obtains a credit bureau report, and
confirms bank and credit reference information. The patient's employment and income
should be verified by telephone and by obtaining a copy of a recent pay stub.
,Function of PFS Department in the Credit Verification step? - ANSWER PFS
departments can estimate a patient's charges by either assigning a provisional
diagnosis-related group to the case or by estimating the charges based on an average
of prior cases for the same treatment or procedure.
Disclosure of the finance charge and annual percentage rate is required by the which
Act? - ANSWER Disclosure of the finance charge and annual percentage rate is
required by the Truth in Lending Act of 1968, whether or not interest is charged
What is the Determination step of the Credit Granting Process? - ANSWER Credit
Granting Process: Determination
The patient's gross annual income should be compared to some standard income
measure that will indicate the patient's financial condition relative to society. The
national Poverty Income Guidelines published annually by the Department of Health
and Human Services provide such a standard of comparison.
PFS personnel should use the patient's total discretionary income (that is, the patient's
net income after paying all fixed expenses) to establish a monthly payment agreement
with the patient. The final terms of a credit agreement must be determined and
documented in writing.
When should payment discounts be offered? - ANSWER A discount is an allowance
given by a provider for timely settlement of a debt and should be granted when it will
change a debtor's behavior by inducing compliance from someone who otherwise
would not comply with payment policies.
How are allowance for patient discounts recorded? - ANSWER Allowances for patient
discounts should be recorded using a specific transaction code to facilitate summary
reporting and monitoring
Who approve payment discount guidelines - ANSWER Payment discount guidelines
should be established in a policy statement approved by the board of trustees.
What factor influence the amount of payment discount? - ANSWER The amount of
payment discount will vary depending on the patient's ability to pay and may be
comparable to discounts extended to managed care and commercial payers.
5) A minimum patient balance to which a discount may apply should be specifie
Deposits and Point-of-Service (POS) Collections Definition - ANSWER Deposits and
Point-of-Service (POS) Collections
, A deposit should be requested to secure payment of a patient's obligation when precise
charge calculations are impractical, such as before service. Advance deposits are an
essential collection tool during preadmission screening, combining anticipated current
charges with any prior outstanding balance.
Two key guidelines for Deposits and Point-of-Service (POS) Collections - ANSWER
Deposits and Point-of-Service (POS) Collections
Implementation guidelines include the following:
a. Deposit policies should be reviewed and approved by the board of trustees.
b. To facilitate calculation of deposits, a worksheet should be prepared.
What are the 8 payment alternatives? - ANSWER Payment in full upon discharge
through any of the following methods:
1) Available demand deposit funds
2) Credit cards
3) Bank line of credit
4) Bank home equity loan
5) Credit union, available funds, or credit
6) Cash from sales of assets
7) Healthcare provider arranging external source of financing without recourse
8) Healthcare provider arranging external source of financing with interest charge
3 methods of extended payment plans - ANSWER Extended payment plan through any
of the following methods:
1) 90 days same-as-cash (three equal monthly payments)
2) Healthcare provider extending periodic payment privilege without interest charge
3) Healthcare provider extending periodic payment privilege with interest charge
nd
What would be considered an effective collection strategy? - ANSWER An effective
collection strategy includes reasonable payment alternatives for self-pay balances, such
as installment programs, and outside financing methods, including loans and credit
cards. Payment alternatives are useful techniques to help boost cash flow and reduce
bad debts, but they require an increased level of management resources and controls
to ensure they are used properly.
Widely used method for collecting self-pay receivables? - ANSWER Installment budget
or contract payment plans, such programs are a widely used method for collecting self-
pay receivables.
In developing or evaluating an installment program, healthcare providers should
recognize the risk factor or chance of financial loss inherent in this approach. What are
100% Correct
What is courtesy discharge? - ANSWER "Courtesy discharge," -- discharge method
permits patients who have supplied all necessary demographic and insurance
information and settled their financial responsibility with the hospital to be discharged
without a required visit to the hospital's cashier or financial counselor.
What is an indicator of effectiveness of hospital permissions? - ANSWER The
effectiveness of the hospital's preadmission program is demonstrated by the number of
patients that are provided the opportunity to be discharged without asking the patient or
patient's representative to visit with a financial counselor
Claims adjudication includes the following: 4 things? - ANSWER Claims adjudication
includes the following:
a. Determination of benefits levels and coverage
b. Coordination of benefits
c. Subrogation of third-party liability claims
d. Generation of appropriate explanation of benefit forms
When must a provider submit encounter data? What is encounter data? - ANSWER A
capitated and at-risk provider must also submit encounter data (specific patient data) to
the managed care organizations with which it contracts.
a. Encounter data are information (financial and clinical) about healthcare services
provided to a managed care organization's enrollees. Encounter data are generally
submitted in the form of a pseudo or zero-pay claim (UB-04 or CMS 1500) and helps
the payer analyze a population's use of healthcare services and the cost of those
services.
How is encounter data used by Medicare & Medicaid? - ANSWER In addition to being
collected by commercial health maintenance organizations (HMOs), encounter data are
used by Medicare and Medicaid to analyze the effect of managed care on beneficiaries.
Submission of encounter data is required for an HMO to obtain a risk contract from
Medicare and Medicaid.
Define Financial Counseling. - ANSWER Financial counseling refers to the process of
extending credit to a patient and agreeing on a payment plan. It involves assisting the
patient in identifying other payment sources that may be available to the patient. It also
involves several activities that can take place before, during, or after a patient receives
service
,As a collection technique, financial counseling should accomplish the following four
critical tasks: - ANSWER As a collection technique, financial counseling should
accomplish the following four critical tasks:
i. Inform the patient financial obligations and provider's payment policies ii. Perform a
financial assessment to determine the patient's ability to pay iii. Evaluate applicable
alternatives such as payment options, assistance programs such as state Medicaid
programs, or free care, based on the financial assessment.
iv. Resolve pending transactions (eg. bank loans or medical assistance applications)
The twin goal of financial counseling: - ANSWER The twin goal of financial counseling:
i. The provider understands upfront a patient's ability to pay
ii. Patient understand their financial responsibility to the provider
3 Steps in the credit-granting process: - ANSWER Steps in the credit-granting
process: i. Application =Gather accurate information ii. Verification=Evaluate credit
worthiness
iii. Determination =Make a credit decision
What 4 things should be included in the patient credit application accomplish? -
ANSWER A patient's application for credit should be in the form of a patient financial
statement. This document should:
a. Stipulate what credit arrangement the patient seeks—evaluation and billing of
thirdparty insurance coverage, a 90-day payment plan, an extended monthly
payment plan, or reduction of total charges.
b. Exact income and expense information plus patient's financial assets and liabilities.
c. Proof of income, and the patient should sign the bottom of the statement
acknowledging that the credit information provided is accurate.
d. PFS departments can estimate a patient's charges by either assigning a provisional
diagnosis-related group to the case or by estimating the charges based on an average
of prior cases for the same treatment or procedure.
Describe the Verification process of the Credit Granting Process: - ANSWER Credit
Granting Process: Verification
Once a patient's credit application has been completed and signed, the PFS
department verifies insurance benefits and eligibility, obtains a credit bureau report, and
confirms bank and credit reference information. The patient's employment and income
should be verified by telephone and by obtaining a copy of a recent pay stub.
,Function of PFS Department in the Credit Verification step? - ANSWER PFS
departments can estimate a patient's charges by either assigning a provisional
diagnosis-related group to the case or by estimating the charges based on an average
of prior cases for the same treatment or procedure.
Disclosure of the finance charge and annual percentage rate is required by the which
Act? - ANSWER Disclosure of the finance charge and annual percentage rate is
required by the Truth in Lending Act of 1968, whether or not interest is charged
What is the Determination step of the Credit Granting Process? - ANSWER Credit
Granting Process: Determination
The patient's gross annual income should be compared to some standard income
measure that will indicate the patient's financial condition relative to society. The
national Poverty Income Guidelines published annually by the Department of Health
and Human Services provide such a standard of comparison.
PFS personnel should use the patient's total discretionary income (that is, the patient's
net income after paying all fixed expenses) to establish a monthly payment agreement
with the patient. The final terms of a credit agreement must be determined and
documented in writing.
When should payment discounts be offered? - ANSWER A discount is an allowance
given by a provider for timely settlement of a debt and should be granted when it will
change a debtor's behavior by inducing compliance from someone who otherwise
would not comply with payment policies.
How are allowance for patient discounts recorded? - ANSWER Allowances for patient
discounts should be recorded using a specific transaction code to facilitate summary
reporting and monitoring
Who approve payment discount guidelines - ANSWER Payment discount guidelines
should be established in a policy statement approved by the board of trustees.
What factor influence the amount of payment discount? - ANSWER The amount of
payment discount will vary depending on the patient's ability to pay and may be
comparable to discounts extended to managed care and commercial payers.
5) A minimum patient balance to which a discount may apply should be specifie
Deposits and Point-of-Service (POS) Collections Definition - ANSWER Deposits and
Point-of-Service (POS) Collections
, A deposit should be requested to secure payment of a patient's obligation when precise
charge calculations are impractical, such as before service. Advance deposits are an
essential collection tool during preadmission screening, combining anticipated current
charges with any prior outstanding balance.
Two key guidelines for Deposits and Point-of-Service (POS) Collections - ANSWER
Deposits and Point-of-Service (POS) Collections
Implementation guidelines include the following:
a. Deposit policies should be reviewed and approved by the board of trustees.
b. To facilitate calculation of deposits, a worksheet should be prepared.
What are the 8 payment alternatives? - ANSWER Payment in full upon discharge
through any of the following methods:
1) Available demand deposit funds
2) Credit cards
3) Bank line of credit
4) Bank home equity loan
5) Credit union, available funds, or credit
6) Cash from sales of assets
7) Healthcare provider arranging external source of financing without recourse
8) Healthcare provider arranging external source of financing with interest charge
3 methods of extended payment plans - ANSWER Extended payment plan through any
of the following methods:
1) 90 days same-as-cash (three equal monthly payments)
2) Healthcare provider extending periodic payment privilege without interest charge
3) Healthcare provider extending periodic payment privilege with interest charge
nd
What would be considered an effective collection strategy? - ANSWER An effective
collection strategy includes reasonable payment alternatives for self-pay balances, such
as installment programs, and outside financing methods, including loans and credit
cards. Payment alternatives are useful techniques to help boost cash flow and reduce
bad debts, but they require an increased level of management resources and controls
to ensure they are used properly.
Widely used method for collecting self-pay receivables? - ANSWER Installment budget
or contract payment plans, such programs are a widely used method for collecting self-
pay receivables.
In developing or evaluating an installment program, healthcare providers should
recognize the risk factor or chance of financial loss inherent in this approach. What are
