HSA 525 Midterm Exam Answers

7 Oct No Comments

What is the primary goal of not-for-profit healthcare organizations?

To serve the community through the provision of health care services

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T or F Governmental health care organizations are able to raise funds through equity investments

False

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Primary responsibilities of treasurership

Provide capital, maintain investor relations, provide short term financing, provide banking and custody, oversee credits and collections, choose investment, provide insurance

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Culver hospital has lowest cost, very large operating expenses, & depends on tax support from community. If positive operating margins are an objective, the hospital is best described as

Efficient but not effective

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What is the difference in the financial management responsibilities of the controller and treasurer?

Controllers functions are internal (record keeping, tracking, controlling) Treasurer functions are external (obtaining and managing funds and creditors)

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What is the controller of a hospital usually responsible for?

Prepare financial statements, establishing budgetary systems, submitting Medicare bills and cost reports

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5 uses of financial information important in decision making

FECES Financial condition, Efficiency, Compliance, Effectiveness, Stewardship

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Efficiency refers to

The ratio of the organizations outputs to inputs

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T or F The earnings of a standard corporation (“C”) can be subject to double taxation.

False

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A department manager most often uses his or her hospitals financial info for what?

To asses the efficiency of operations

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What is meant by the term “revenue cycle”

The entire process from providing services to receiving payment and how payments go back into providing services

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T or F Data in the medical record is the primary source for documenting the provision of services

True

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How many digits are CPT codes comprised of?

5

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What are HCPCS

Code set used by physicians for reporting procedures for both inpatient and outpatient services. Three levels (III for state codes, not used anymore)

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What tier of HCPCS is the same as CPT codes?

Level I

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What are the two types of forms used for health services billing?

CMS – 1500
CMS – 1450

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What is charge explosion?

One code entered generates a list of all codes used for that services. Bundled.

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T or F HIPAA requires that two categories of information be reported to payers: diagnosis codes and procedure codes

True

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T or F Lost charges resulting from improper documentation or poor coding and billing practices do not have a major impact on the finances of healthcare providers.

False

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What is the final step of claim submission?

Claim editing

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T or F Some benefits under Medicare part A include hospital stays, skilled nursing care, and home health care.

True

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What tends to insulate management somewhat from the financial results of poor financial planning?

Cost reimbursement

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What is the main difference between fee-for-service and capitation reimbursement methods?

With fee for service, providers receive payment for necessary services as they are provided, but in capitation, providers receive payment in advance to care for specific healthcare needs of a defined population over a specific period (per member per month)

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T or F Medicare uses Resource Utilization Groups III as its basis for reimbursement to home health agencies.

False

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Medicare pays for hospice services under which plan?

A

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T or F A hospital that is caring for a Medicare patient on an outpatient basis generally can increase its reimbursement by providing additional services.

True

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What is the primary distinction between prospective payment and retrospective payment?

Prospective payment has the price set in advance. Retrospective payments have the billing completed after services.

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What is the primary payer for acute-care (hospital) services?

Government payers (all sources)

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Physicians affiliated through an Individual Practice Association need to be concerned primarily about what legal/regulatory issue?

Antitrust

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What is the primary provision of EMTALA?

to provide appropriate medical screening to each patient requesting emergency care to determine whether the patient requires such care.

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What law/regulation would prohibit a physician from referring patients to an entity (health care organization) in which he or she has a financial interest?

Stark Law

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T or F EMTALA allows a hospital to transfer an emergency patient to another hospital because of a patients inability to pay.

False

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What is the False Claims Act and how does it impact providers of health care services?

FCA is a civil remedy for improper or fraudulent claims for all federal programs, not just health care. Under the FCA healthcare providers who knowingly make false or fraudulent claims are fined $5,500 to $11,000 per claim plus up to 3 times the amount of damages caused to fed. program.

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T or F Prosecution under the False Claims Act requires that specific intent to defraud the government was present.

False

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How does the Stark Law impact physicians?

It prohibits them from referring patients to any place that they have a “financial relationship” with. So, if a physician is an investor in a private clinic, they can’t refer anyone to that clinic.

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Assume that a ltc facility provides inadequate nutrition, wound care, and medication for which it bills government programs. What health care law could it be prosecuted under?

False Claims Act

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The American Hospital Association recognizes what as legitimate areas of community benefit?

Bad debts and Unreimbursed Medicare Costs

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The IRS form a not-for-profit organization uses to apply for tax exempt status is:

501(c)(3)

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A not-for-profit exceeding annual revenues of $25,000 and qualify for exempt status must file which form?

IRS Form 990

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How is charity care usually defined?

dollar value of services provided to patients at no cost or reduced cost

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It should be expected that proprietary hospitals often have low Community Value Index scores because

They have higher proces

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How do a high percentage of Medicaid patients influence a hospitals prices?

hospital prices will increase to make up for the smaller payments received by Medicaid reimbursements

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What contract provision will best protect a hospital being paid on a DRG basis for inpatient services from a catastrophic patient?

None

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T or F In the health care marketplace, market share has the most pervasive influence on prices.

False

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What measure is not used directly as one of the means of determining the reasonableness of a hospitals charges?

prices of peer hospitals

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What are three factors that influence pricing?

Desired Net Income, Competitive Position, Market Structure

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T or F Providing higher-quality care can ultimately lead to increased revenues.

True

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What can a health care provider vary across different payers?

Discounts

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Why does market share matter to a health care provider?

Greater market share leads to greater leverage when negotiating health plan contracts.

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What is the best way to compare hospital costs?

On the basis of individual assessment of cost for inpatient and outpatient services.




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