TEST BANK
GAPENSKI'S FUNDAMENTALS OF HEALTHCARE FINANCE
3RD EDITION
CHAPTER 1: INTRODUCTION TO HEALTHCARE FINANCE
1. Which of the following statements about finance, accounting, or financial
management is most correct?
a. Accounting is of no value in decision making.
b. Accounting provides the theory and concepts necessary to help
managers make better decisions.
c. Financial management involves the measurement, in financial terms, of
operational events that affect the resources and financing of an
organization.
d. The primary role of finance is to plan for, acquire, and use resources to
maximize the efficiency (and value) of the enterprise.
e. Financial management is of no value in decision making.
Answer: d
2. Which of the following is not a finance activity?
a. Planning and budgeting
b. Revenue cycle management
c. Financial reporting
d. Financial risk management
e. Facilities management
Answer: e
3. True or false: The four Cs (character, capability, charisma, and courtesy) as
described in the textbook summarize the attributes needed to be a good financial
manager.
a. True
b. False
Answer: False
,4. True or false: The role of finance in healthcare organizations has increased in
importance over time because the finance function must support a multitude of
activities such as cost containment, payer negotiations, and joint venture
activities.
a. True
b. False
Answer: True
5. Which of the following statements about the finance department at a large
healthcare organization is most correct?
a. The department is headed by the chief financial officer (CFO)
(sometimes called the vice-president finance).
b. The CFO typically reports directly to the chief executive officer (CEO).
c. The CFO usually is assisted by a controller and treasurer.
d. The comptroller and treasurer often have managers under them
responsible for specific functions such as patient accounts management
and cash management.
e. All of the above statements are correct.
Answer: e
6. Which of the following statements about hospitals is most correct?
a. Patients at general acute care hospitals typically have long patient
stays, often 30 or more days.
b. The number of specialty hospitals has declined over the last three
decades.
c. The optimal size for a hospital is roughly 50 beds.
d. The majority of hospitals are public or not-for-profit (as opposed to
investor owned).
e. Most physicians involved with hospital services are hospital employees.
Answer: d
,7. Which of the following statements about healthcare providers is incorrect?
a. Traditional outpatient settings include clinics, medical practices, hospital
outpatient departments, and emergency rooms.
b. Long-term care includes both healthcare and personal care services.
c. There are many more hospitals than there are nursing homes, but
nursing homes tend to have a greater number of beds.
d. One of the hypothesized benefits of integrated delivery systems is
patient capture.
e. Patients with chronic illnesses are best treated by a single case
manager regardless of the provider setting.
Answer: c
8. True or false: Many studies have demonstrated that integrated delivery
systems are able to provide higher-quality care at lower cost than can stand-
alone specialized provider organizations.
a. True
b. False
Answer: False
9. In the United States, the highest proportion of healthcare expenditures is for
_______________.
a. prescription drugs
b. nursing home care
c. hospital care
d. dental care
e. home health care
Answer: c
, 10. Which of the following statements about regulatory and legal issues is most
correct?
a. States require licensure of certain healthcare providers to limit the
number of providers.
b. The goal of certificate-of-need (CON) regulation is to ensure that there
are a sufficient number of clinical workers at each hospital and nursing
home.
c. Clinicians who are employees of hospitals do not require personal
licenses, as they can practice under the umbrella of the hospital's license.
d. For most providers, the primary legal concern is professional liability.
e. Healthcare managers must grapple with several legal issues, but there
are virtually no ethical issues that arise.
Answer: d
GAPENSKI'S FUNDAMENTALS OF HEALTHCARE FINANCE
3RD EDITION
CHAPTER 1: INTRODUCTION TO HEALTHCARE FINANCE
1. Which of the following statements about finance, accounting, or financial
management is most correct?
a. Accounting is of no value in decision making.
b. Accounting provides the theory and concepts necessary to help
managers make better decisions.
c. Financial management involves the measurement, in financial terms, of
operational events that affect the resources and financing of an
organization.
d. The primary role of finance is to plan for, acquire, and use resources to
maximize the efficiency (and value) of the enterprise.
e. Financial management is of no value in decision making.
Answer: d
2. Which of the following is not a finance activity?
a. Planning and budgeting
b. Revenue cycle management
c. Financial reporting
d. Financial risk management
e. Facilities management
Answer: e
3. True or false: The four Cs (character, capability, charisma, and courtesy) as
described in the textbook summarize the attributes needed to be a good financial
manager.
a. True
b. False
Answer: False
,4. True or false: The role of finance in healthcare organizations has increased in
importance over time because the finance function must support a multitude of
activities such as cost containment, payer negotiations, and joint venture
activities.
a. True
b. False
Answer: True
5. Which of the following statements about the finance department at a large
healthcare organization is most correct?
a. The department is headed by the chief financial officer (CFO)
(sometimes called the vice-president finance).
b. The CFO typically reports directly to the chief executive officer (CEO).
c. The CFO usually is assisted by a controller and treasurer.
d. The comptroller and treasurer often have managers under them
responsible for specific functions such as patient accounts management
and cash management.
e. All of the above statements are correct.
Answer: e
6. Which of the following statements about hospitals is most correct?
a. Patients at general acute care hospitals typically have long patient
stays, often 30 or more days.
b. The number of specialty hospitals has declined over the last three
decades.
c. The optimal size for a hospital is roughly 50 beds.
d. The majority of hospitals are public or not-for-profit (as opposed to
investor owned).
e. Most physicians involved with hospital services are hospital employees.
Answer: d
,7. Which of the following statements about healthcare providers is incorrect?
a. Traditional outpatient settings include clinics, medical practices, hospital
outpatient departments, and emergency rooms.
b. Long-term care includes both healthcare and personal care services.
c. There are many more hospitals than there are nursing homes, but
nursing homes tend to have a greater number of beds.
d. One of the hypothesized benefits of integrated delivery systems is
patient capture.
e. Patients with chronic illnesses are best treated by a single case
manager regardless of the provider setting.
Answer: c
8. True or false: Many studies have demonstrated that integrated delivery
systems are able to provide higher-quality care at lower cost than can stand-
alone specialized provider organizations.
a. True
b. False
Answer: False
9. In the United States, the highest proportion of healthcare expenditures is for
_______________.
a. prescription drugs
b. nursing home care
c. hospital care
d. dental care
e. home health care
Answer: c
, 10. Which of the following statements about regulatory and legal issues is most
correct?
a. States require licensure of certain healthcare providers to limit the
number of providers.
b. The goal of certificate-of-need (CON) regulation is to ensure that there
are a sufficient number of clinical workers at each hospital and nursing
home.
c. Clinicians who are employees of hospitals do not require personal
licenses, as they can practice under the umbrella of the hospital's license.
d. For most providers, the primary legal concern is professional liability.
e. Healthcare managers must grapple with several legal issues, but there
are virtually no ethical issues that arise.
Answer: d
