HCAD 760 Exam Questions with Correct Answers Latest Update 2025/2026
The major provisions of the Patient Protection and Affordable care act of 2010 were? - Answers
Medicaid expansion, banning of preexisting condition coverage limitations, free preventive care
Which of the following statements about the finance department at large healthcare
organizations is/are correct? - Answers The CFO usually is assisted by a comptroller and
treasurer/reports directly to the CEO/headed by CFO or VP
In a not for profit hospital, the following are examples of a stakeholder - Answers Community;
employee; vendor
Stockholders have all the following rights - Answers Right of control/claim on residual
liquidation proceeds/a possible dividend and/or capital gains
Which of the following statements about finance, accounting, and financial management is
most correct? - Answers Financial management provides the theory, concepts, and tools
necessary to help managers make better financial decisions.
What is a disadvantage of being a corporation? - Answers External reporting
Which of the following are not finance activities? - Answers Facilities management
What is Not an advantage of a proprietorship? - Answers Unlimited liability
A not for profit corporation can also be called a 529(b) - Answers False
The primary goal of investor owned corporations is shareholder wealth maximization - Answers
True
Individuals at greater risk of needing health care are more likely to purchase insurance -
Answers Adverse selection
The fixed amount for a covered service that the insurer mandates that the patient pay to the
provider before the patient receives service from the provider - Answers Copayments
The amount that must be paid out of pocket by the policyholder before an insurance provider
will pay any expenses - Answers Deductibles
Requires an individual to pay for a certain percentage of the eligible medical expenses -
Answers Coinsurance
The risk of overuse of health services because the injured does not bear the full cost of the
consequences - Answers Moral hazard
Medicare part A - Answers Covers hospital and some skilled nursing home coverage
Medicare Part D - Answers Covers prescription drugs
, Medicare Part C - Answers Is often called Med Adv
Providers were reimbursed for "actual" costs - Answers Cost-based
Payers pay based off pre-determined "chargemaster" these payments are usually discounted up
to 20% to 50% - Answers Charge based
Are used to pay for either a predefined procedure, diagnosis, per diem or bundled service -
Answers Prospective payment
Payment is (usually) made on a per member per month basis - Answers Capitation
Has potential to result in "gamesmanship" that can inflate healthcare charges - Answers Charge
based
No incentive to control costs - Answers Cost based
Providers may have an incentive to reduce utilization - Answers Capitation
May result in up coding - Answers Prospective payment
Under the broad category of FFS, what are the three main types of ffs service methodologies -
Answers Cost based; prospective payments; charge based
True statements about ICD Codes - Answers The greater number of digits in the code, the more
detailed the disease; ICD stands for International Classification of Diseases; The codes usually
consist of 3, 4, 5, 6, or 7 digits/characters; ICD-10 is the current standard
Identify all of the different types of managed care insurance plans - Answers HMOs, POS plans,
PPOs
Relative value units (RVUs) are standards that are payment components consisting of the
following: - Answers Work expense; malpractice/liability expense; practice expenses
For insurance to "work", it must have these basic characteristics - Answers Payment only for
random (unforeseen and unexpected) losses; risk transfer; pooling of losses
Under the PPACA, insurance companies have to use community ratings - Answers True
Materiality - Answers GAAP Constraint
Expense Matching - Answers GAAP Principle
Going Concern - Answers GAAP Assumption
Operating income - Answers Is a measure of the income generated from the "core" business of
the organization
The major provisions of the Patient Protection and Affordable care act of 2010 were? - Answers
Medicaid expansion, banning of preexisting condition coverage limitations, free preventive care
Which of the following statements about the finance department at large healthcare
organizations is/are correct? - Answers The CFO usually is assisted by a comptroller and
treasurer/reports directly to the CEO/headed by CFO or VP
In a not for profit hospital, the following are examples of a stakeholder - Answers Community;
employee; vendor
Stockholders have all the following rights - Answers Right of control/claim on residual
liquidation proceeds/a possible dividend and/or capital gains
Which of the following statements about finance, accounting, and financial management is
most correct? - Answers Financial management provides the theory, concepts, and tools
necessary to help managers make better financial decisions.
What is a disadvantage of being a corporation? - Answers External reporting
Which of the following are not finance activities? - Answers Facilities management
What is Not an advantage of a proprietorship? - Answers Unlimited liability
A not for profit corporation can also be called a 529(b) - Answers False
The primary goal of investor owned corporations is shareholder wealth maximization - Answers
True
Individuals at greater risk of needing health care are more likely to purchase insurance -
Answers Adverse selection
The fixed amount for a covered service that the insurer mandates that the patient pay to the
provider before the patient receives service from the provider - Answers Copayments
The amount that must be paid out of pocket by the policyholder before an insurance provider
will pay any expenses - Answers Deductibles
Requires an individual to pay for a certain percentage of the eligible medical expenses -
Answers Coinsurance
The risk of overuse of health services because the injured does not bear the full cost of the
consequences - Answers Moral hazard
Medicare part A - Answers Covers hospital and some skilled nursing home coverage
Medicare Part D - Answers Covers prescription drugs
, Medicare Part C - Answers Is often called Med Adv
Providers were reimbursed for "actual" costs - Answers Cost-based
Payers pay based off pre-determined "chargemaster" these payments are usually discounted up
to 20% to 50% - Answers Charge based
Are used to pay for either a predefined procedure, diagnosis, per diem or bundled service -
Answers Prospective payment
Payment is (usually) made on a per member per month basis - Answers Capitation
Has potential to result in "gamesmanship" that can inflate healthcare charges - Answers Charge
based
No incentive to control costs - Answers Cost based
Providers may have an incentive to reduce utilization - Answers Capitation
May result in up coding - Answers Prospective payment
Under the broad category of FFS, what are the three main types of ffs service methodologies -
Answers Cost based; prospective payments; charge based
True statements about ICD Codes - Answers The greater number of digits in the code, the more
detailed the disease; ICD stands for International Classification of Diseases; The codes usually
consist of 3, 4, 5, 6, or 7 digits/characters; ICD-10 is the current standard
Identify all of the different types of managed care insurance plans - Answers HMOs, POS plans,
PPOs
Relative value units (RVUs) are standards that are payment components consisting of the
following: - Answers Work expense; malpractice/liability expense; practice expenses
For insurance to "work", it must have these basic characteristics - Answers Payment only for
random (unforeseen and unexpected) losses; risk transfer; pooling of losses
Under the PPACA, insurance companies have to use community ratings - Answers True
Materiality - Answers GAAP Constraint
Expense Matching - Answers GAAP Principle
Going Concern - Answers GAAP Assumption
Operating income - Answers Is a measure of the income generated from the "core" business of
the organization
