HFMA CRCR Final Exam Test Bank
– 2025/2026 Edition – Verified
Questions and Answers
Question 1: When a Medicare beneficiary receives outpatient observation
services that exceed 24 hours but do not meet inpatient admission criteria, how
should the hospital bill for these services?
A. As part of the inpatient DRG payment
B. Under outpatient observation services using HCPCS code G0378
C. As a separate Part B claim with no time limit
D. Observation services are not reimbursable by Medicare
Correct Answer:-B. Under outpatient observation services using HCPCS
code G0378
Rationale:Medicare requires observation services lasting more than 24 hours to
be billed with HCPCS code G0378 (observation per hour) along with G0379.
These are outpatient services paid under OPPS.
Question 2: What is the primary purpose of the Medicare Outpatient Observation
Notice (MOON)?
A. To notify the patient that observation services are not covered
B. To inform Medicare beneficiaries of their status as an outpatient receiving
observation services and potential cost-sharing implications
C. To obtain prior authorization for observation stays
D. To document the medical necessity of inpatient admission
Correct Answer:-B. To inform Medicare beneficiaries of their status as an
outpatient receiving observation services and potential cost-sharing
implications
Rationale:The MOON (CMS-10611) must be given to Medicare patients
receiving observation services for more than 24 hours to explain their outpatient
status and possible SNF coverage impact.
,Question 3: Under the Two-Midnight Rule, which of the following correctly
describes when inpatient admission is considered appropriate?
A. The physician expects the patient to require a hospital stay that crosses two
midnights
B. The patient stays less than 24 hours total
C. The patient receives only outpatient observation services
D. The hospital admits the patient for convenience of scheduling tests
Correct Answer:-A. The physician expects the patient to require a hospital
stay that crosses two midnights
Rationale:The Two-Midnight Rule presumes inpatient admission is appropriate
when the physician expects the patient to need hospital care spanning at least two
midnights, not including the day of admission.
Question 4: What is the effect of the Affordable Care Act's (ACA) 60-day
overpayment rule on healthcare providers?
A. Providers have 60 days to refund identified overpayments or face potential
False Claims Act liability
B. Overpayments can be kept if under $500
C. Providers must wait 60 days before reporting overpayments
D. The rule only applies to Medicare Part D
Correct Answer:-A. Providers have 60 days to refund identified
overpayments or face potential False Claims Act liability
Rationale:The ACA requires providers to report and return any identified
overpayment within 60 days of identification, with potential FCA penalties for
noncompliance.
Question 5: A hospital is reimbursed under the Inpatient Prospective Payment
System (IPPS). Which of the following factors directly determines the MS-DRG
weight assigned to a patient stay?
A. The patient's out-of-pocket maximum
B. The patient's principal diagnosis, comorbidities, and procedures
C. The patient's length of stay in days
D. The hospital's geographic wage index only
Correct Answer:-B. The patient's principal diagnosis, comorbidities, and
procedures
,Rationale:MS-DRG assignment is based on clinical data: principal diagnosis, up
to 25 secondary diagnoses (including CCs and MCCs), and significant procedures.
Question 6: A Medicare Advantage (Part C) patient is admitted to an IPPS
hospital. Which entity is primarily responsible for approving inpatient admission
and determining medical necessity?
A. The hospital's utilization review department
B. The Medicare Administrative Contractor (MAC)
C. The Medicare Advantage plan
D. CMS directly
Correct Answer:-C. The Medicare Advantage plan
Rationale:Medicare Advantage plans manage their own utilization review, prior
authorization, and medical necessity determinations for their enrolled members.
Question 7: Which of the following best describes the "72-hour rule" for
Medicare outpatient services preceding an inpatient admission?
A. All outpatient services within 72 hours of admission must be included in the
inpatient claim
B. Only diagnostic services (not therapeutic) provided within 3 calendar days of
admission are bundled into the inpatient claim
C. The rule applies only to non-Medicare patients
D. Outpatient services provided within 72 hours are never reimbursed
Correct Answer:-B. Only diagnostic services (not therapeutic) provided
within 3 calendar days of admission are bundled into the inpatient claim
Rationale:Under the 72-hour rule, outpatient diagnostic and certain non-
diagnostic services related to the inpatient stay, provided within 3 calendar days (or
1 day for critical access hospitals), are bundled into the inpatient claim.
Question 8: When a hospital bills for outpatient services using revenue code 0450
(Emergency Department), which of the following is required for Medicare
payment?
A. A valid HCPCS code for each line item
B. A signed ABN for every patient regardless of coverage
C. An order from a physician or qualified NPP
D. Both A and C
, Correct Answer:-D. Both A and C (A valid HCPCS code for each line item
and an order from a physician or qualified NPP)
Rationale:Medicare requires a valid HCPCS code for each ED service billed and
a physician order for the level of service provided.
Question 9: Which of the following is a core requirement of the HCAHPS
(Hospital Consumer Assessment of Healthcare Providers and Systems) survey?
A. Survey results must be publicly reported on the Hospital Compare website
B. Hospitals may select only their best patients to survey
C. Surveys are conducted only by mail
D. HCAHPS scores do not affect reimbursement
Correct Answer:-A. Survey results must be publicly reported on the
Hospital Compare website
Rationale:HCAHPS is a standardized survey that must be administered to a
random sample of adult inpatients, and results are publicly reported, affecting
value-based purchasing reimbursement.
Question 10: A patient presents for scheduled chemotherapy over 5 consecutive
days. The most efficient registration method is:
A. Single registration per day
B. Recurring registration (series registration)
C. Emergency registration each day
D. No registration required for outpatient oncology
Correct Answer:-B. Recurring registration (series registration)
Rationale:Recurring or series registration allows one registration record to cover
multiple service dates for ongoing treatments such as chemotherapy or dialysis,
improving efficiency.
Question 11: Under the Hospital Value-Based Purchasing (VBP) Program, how
are hospital payments adjusted?
A. Across-the-board percentage reduction to all DRG payments
B. Withhold a percentage of base DRG payments and redistribute based on total
performance score (TPS)
C. Add a fixed bonus to each discharge
D. No payment adjustment for quality
– 2025/2026 Edition – Verified
Questions and Answers
Question 1: When a Medicare beneficiary receives outpatient observation
services that exceed 24 hours but do not meet inpatient admission criteria, how
should the hospital bill for these services?
A. As part of the inpatient DRG payment
B. Under outpatient observation services using HCPCS code G0378
C. As a separate Part B claim with no time limit
D. Observation services are not reimbursable by Medicare
Correct Answer:-B. Under outpatient observation services using HCPCS
code G0378
Rationale:Medicare requires observation services lasting more than 24 hours to
be billed with HCPCS code G0378 (observation per hour) along with G0379.
These are outpatient services paid under OPPS.
Question 2: What is the primary purpose of the Medicare Outpatient Observation
Notice (MOON)?
A. To notify the patient that observation services are not covered
B. To inform Medicare beneficiaries of their status as an outpatient receiving
observation services and potential cost-sharing implications
C. To obtain prior authorization for observation stays
D. To document the medical necessity of inpatient admission
Correct Answer:-B. To inform Medicare beneficiaries of their status as an
outpatient receiving observation services and potential cost-sharing
implications
Rationale:The MOON (CMS-10611) must be given to Medicare patients
receiving observation services for more than 24 hours to explain their outpatient
status and possible SNF coverage impact.
,Question 3: Under the Two-Midnight Rule, which of the following correctly
describes when inpatient admission is considered appropriate?
A. The physician expects the patient to require a hospital stay that crosses two
midnights
B. The patient stays less than 24 hours total
C. The patient receives only outpatient observation services
D. The hospital admits the patient for convenience of scheduling tests
Correct Answer:-A. The physician expects the patient to require a hospital
stay that crosses two midnights
Rationale:The Two-Midnight Rule presumes inpatient admission is appropriate
when the physician expects the patient to need hospital care spanning at least two
midnights, not including the day of admission.
Question 4: What is the effect of the Affordable Care Act's (ACA) 60-day
overpayment rule on healthcare providers?
A. Providers have 60 days to refund identified overpayments or face potential
False Claims Act liability
B. Overpayments can be kept if under $500
C. Providers must wait 60 days before reporting overpayments
D. The rule only applies to Medicare Part D
Correct Answer:-A. Providers have 60 days to refund identified
overpayments or face potential False Claims Act liability
Rationale:The ACA requires providers to report and return any identified
overpayment within 60 days of identification, with potential FCA penalties for
noncompliance.
Question 5: A hospital is reimbursed under the Inpatient Prospective Payment
System (IPPS). Which of the following factors directly determines the MS-DRG
weight assigned to a patient stay?
A. The patient's out-of-pocket maximum
B. The patient's principal diagnosis, comorbidities, and procedures
C. The patient's length of stay in days
D. The hospital's geographic wage index only
Correct Answer:-B. The patient's principal diagnosis, comorbidities, and
procedures
,Rationale:MS-DRG assignment is based on clinical data: principal diagnosis, up
to 25 secondary diagnoses (including CCs and MCCs), and significant procedures.
Question 6: A Medicare Advantage (Part C) patient is admitted to an IPPS
hospital. Which entity is primarily responsible for approving inpatient admission
and determining medical necessity?
A. The hospital's utilization review department
B. The Medicare Administrative Contractor (MAC)
C. The Medicare Advantage plan
D. CMS directly
Correct Answer:-C. The Medicare Advantage plan
Rationale:Medicare Advantage plans manage their own utilization review, prior
authorization, and medical necessity determinations for their enrolled members.
Question 7: Which of the following best describes the "72-hour rule" for
Medicare outpatient services preceding an inpatient admission?
A. All outpatient services within 72 hours of admission must be included in the
inpatient claim
B. Only diagnostic services (not therapeutic) provided within 3 calendar days of
admission are bundled into the inpatient claim
C. The rule applies only to non-Medicare patients
D. Outpatient services provided within 72 hours are never reimbursed
Correct Answer:-B. Only diagnostic services (not therapeutic) provided
within 3 calendar days of admission are bundled into the inpatient claim
Rationale:Under the 72-hour rule, outpatient diagnostic and certain non-
diagnostic services related to the inpatient stay, provided within 3 calendar days (or
1 day for critical access hospitals), are bundled into the inpatient claim.
Question 8: When a hospital bills for outpatient services using revenue code 0450
(Emergency Department), which of the following is required for Medicare
payment?
A. A valid HCPCS code for each line item
B. A signed ABN for every patient regardless of coverage
C. An order from a physician or qualified NPP
D. Both A and C
, Correct Answer:-D. Both A and C (A valid HCPCS code for each line item
and an order from a physician or qualified NPP)
Rationale:Medicare requires a valid HCPCS code for each ED service billed and
a physician order for the level of service provided.
Question 9: Which of the following is a core requirement of the HCAHPS
(Hospital Consumer Assessment of Healthcare Providers and Systems) survey?
A. Survey results must be publicly reported on the Hospital Compare website
B. Hospitals may select only their best patients to survey
C. Surveys are conducted only by mail
D. HCAHPS scores do not affect reimbursement
Correct Answer:-A. Survey results must be publicly reported on the
Hospital Compare website
Rationale:HCAHPS is a standardized survey that must be administered to a
random sample of adult inpatients, and results are publicly reported, affecting
value-based purchasing reimbursement.
Question 10: A patient presents for scheduled chemotherapy over 5 consecutive
days. The most efficient registration method is:
A. Single registration per day
B. Recurring registration (series registration)
C. Emergency registration each day
D. No registration required for outpatient oncology
Correct Answer:-B. Recurring registration (series registration)
Rationale:Recurring or series registration allows one registration record to cover
multiple service dates for ongoing treatments such as chemotherapy or dialysis,
improving efficiency.
Question 11: Under the Hospital Value-Based Purchasing (VBP) Program, how
are hospital payments adjusted?
A. Across-the-board percentage reduction to all DRG payments
B. Withhold a percentage of base DRG payments and redistribute based on total
performance score (TPS)
C. Add a fixed bonus to each discharge
D. No payment adjustment for quality
