CHFP Module 1 Certification Test

What payment approach is similar to the inpatient DRG in that the amount paid is based on the specific procedure or service provided to the patient?

(APC) Ambulatory Payment Classification

What 2 payment approaches are used in the per-procedure payment plan?

(APC) Ambulatory Payment Classification and Resource Based Relative Value Scale (RBRVS)

is a classification of a disease or injury into one of approximately 750 different categories. The amount paid is a flat rate per discharge and is adjusted based on: Relative severity of the patient's condition Resources used to treat the condition as determined by the DRG for that condition

(DRG)

A payment based on the patient's diagnosis is known as a

(DRG) Diagnosis Related Group

What is the most widely used in payments to healthcare providers.

(DRG)'s

Provider Strategies Insight into how consumers want to access care and making it easy for them to choose the health system every time Price transparency tools, including cash prices for shoppable services and procedures

-

Essential elements of the cooperative relationship between clinical and financial staff include:

-common set of objectives -agreement on communication strategies -sense of trust and transparency between the two disciplines

Prairie Family Care currently has a contract with Premier Health Plan to provide primary healthcare services to about 5,000 Premier members. Prairie has been paid 75% of charges for services but the contract will expire soon. Which of the following items represents a potential risk to Prairie Family Care if they accept capitation from Premier?

. Potential losses from increases in service utilization

Why do Healthcare Facilities set Retail prices significantly above rates actually paid by commercial insurers or the government?

1. Access to Contracted Payment Rates. -Rare not all insurers participate in provider networks that give them access to contracted payment rates. Some auto insurers, liability insurers or companies providing travel insurance to visitors from abroad still pay a provider's full charges. 2. Percent-of-Charge Contracts -In markets with little competition, percent-of-charge contracts are still common. The higher the price, the higher the percent-of-charge payment, unless the contract limits a provider's annual price increases. 3. Outlier Provisions -Some insurance contacts contain an outlier provision that entitles providers to an additional payment (a lump-sum payment or a percentage of actual charges above a threshold) for particularly sick and high-cost patients.

what is the payment processing steps?

1. CLAIM LOGGING 2. ELIGIBILITY 3. ADJUDICATION 4. REMITTANCE

What are the 5 main types of prospective payments used in today's healthcare market?

1. DRG healthcare provider 2. Per Procedure 3. Case rate - healthcare provider or physician 4. Per diem - healthcare provider 5. Bundled payment - healthcare provider, physicians and post-acute providers

What is the business intelligence implementation process?

1. Data strategy 2. Data availability 3. Data integrity

What are the 3 ways both must understand and engage patients? for the outcomes based payment model to succeed?

1. Health plan and providers must learn how to attract patients and increase the number of lives under mgmt 2. health pland and providers must eliminate unnceessary utlization 3. health plan and providers with the assistance of employers must learn how to help patients change behaviors that drive adverse outcomes

What are the drivers of consumerism

1. availiability of information about diseases, treatments, physicians, and other health professionals on the internet 2. expectations of consumers for convenience and levels of service they have become accustomed to in other sectors of the economy 3. Increased patient cost sharing (high- deductible health plans) turns patients into shopperthat demand price transparency

3 components of a budget for a healthcare business

1. cash budget 2. capital budget 3. operating budget

Susan works in the patient registration area at Chase Memorial Hospital. She has a patient at her registration station that has arrived for an upper GI procedure. Susan will need to complete several steps before the patient will be seen for care. Place the following items in order in which they should be accomplished.

1. gather demographic data from patient 2. verify that the patient's information is updated and complete 3. contact the insurer 4.educate the patient about their financial responsibility to pay 5. ask how they would like to pay 6. collect the payment

Put the following during-visit activities in the correct order by dragging the activity to the correct numbered position.

1. provide and document care to the patient 2. utilization review 3. change capture 4. discharge 5. medical record completion`

Healthcare sector makes up the nations ______ % of GDP

20% gdp

remittance advice sent from the health plan to the provider explaining the payment decision is also a standard ANSI format, referred to as the ANSI 835 Healthcare Claim Payment/Advice is called -------

835 record.

Affiliated Health Plan is negotiating a new contract with a local ambulatory surgery center. Previously, Affiliated paid that surgery center on a discount-off-of-billed charges basis and is trying to change to a per-procedure method of payment. Which of the following mechanisms must Affiliated have in place in order to control its risk of increased costs?

A utilization management program Because a per-procedure method creates an incentive for providers to bill for more procedures, the health plan must monitor utilization and make sure that only medically necessary services are provided.

Population Health Management can best be defined as:

A. A concept which promotes the overall health of a group of patients through the cooperation of providers and a health plan.

Karen White is Chief Financial Officer of Midwestern Health Plan. Karen and the CEO have agreed to implement a business intelligence function in the Plan. They want to gain a better understanding of payments and quality outcomes. What items should Karen consider as she begins to implement this function at Midwestern?

A. Bring financial and clinical staff together to plan and execute analyses for the plan

The payment category that utilizes a payment based on a fixed amount per member per month (PMPM) is:

A. Capitation

Which of the terms below represent the payer's steps involved in payment processing (claims adjudication)?

A. Claims logging, eligibility, adjudication, remittance

The need to abide by governmental regulations, whether they are for the provision of care, billing, privacy accounting standards, security or the like refers to: A. Compliance B. Chronic Medicare C. Health proactive standards D. None of the above

A. Compliance

Inland Medical Center is contemplating a per diem payment contract for inpatient services with a local health plan. Which of the following mechanisms must be in place in order for the hospital and the payer to have acceptable financial results from this contractual relationship?

A. Concurrent review

There are three steps in implementing business intelligence. Which of the groups of steps below represent these three steps?

A. Data strategy, data availability, data integrity

Charles Medical Center is interested in forming an Accountable Care Organization (ACO) with the Medicare program. Which of the following would be a priority for Charles Medical Center in forming a Medicare ACO?

A. Develop information systems

Which group of words below represents participants in the healthcare system that are NOT directly involved with patient care? A. Insurers, regulators, suppliers B. Insurers, providers, regulators C. Providers, regulators, suppliers D. Insurers, providers, suppliers

A. Insurers, regulators, suppliers Insurers, regulators, and suppliers are pivotal in the business environment in which care is provided. None of these entities provides medical treatment to patients.

Ambulatory Payment Classification (APC) and Resource-Based Relative Value Scale (RBRVS) are both approaches to which type of payment?

A. Per procedure

Which of the doctors and/or facilities involved in Maria's care should she expect to receive a bill from for their services?

A. Primary care physician B. Radiologist C. Hospital D. Surgeon E. Anesthesiologist F. Pathologist (all correct)

The combined activities of pre-visit, during-visit, post-visit are known collectively as the:

A. Revenue cycle

In which act, federal legislation designed to tighten accounting standards in financial reporting and that holds top executives personally liable as to the accuracy and fairness of their financial statements? A. Sarbanes-Oxley Act B. Insurance accountability Act C. Financial statement Act D. Portability and Accountability Standardized Act

A. Sarbanes-Oxley Act

The key factors that have contributed to the higher cost of health care include: A. Technology, aging population, chronic disease and litigation B. Aging population, chronic disease, performance payment and litigation C. Technology, performance payment and litigation D. All of the above

A. Technology, aging population, chronic, disease and litigation

Which of the following statements is NOT true regarding fees provided for service? Select the best response. A. There is always only one provider to which fees are paid. B. There can be multiple providers involved in treatment to which fees are owed. C. There is often a third party payer which pays for services.

A. There is always only one provider to which fees are paid. Explanation: It is common for several different types of providers to be involved in treatment and consequently are due fees.

The combination of age and technology has increased cost with the passage of time. A. True B. False

A. True

Select the formula below that reflects the value proposition. A. Value = Quality/Payment B. Quality = Value/Payment C. Value = Payment/Quality

A. Value = Quality/Payment Value is defined as quality (quality patient outcomes, patient satisfaction, safety and cost) and payment is the amount paid by all purchasers of care.

The Affordable Care Act encourages providers to form entities called _________ which encourages them to work together to keep patients healthy.

ACO's is a payment and care delivery model, included in the affordable care act that ties provider reimbrusements based on quality metrics and expected cost reductions for the care of a defined population of patients

the claim for payment (or bill) is referred to as the ------

ANSI 837 Healthcare Claim Format, or more commonly as the 837 record.

part of the process for clean review by a payer

Adjucation cycle

What change the basis of payment for hospital outpatient services from a flat fee for individual services to fixed reimbursement for bundled services? A. Cost payment system B. Ambulatory payment classifications C. Cost compliance and litigation D. None of the above

Ambulatory payment classifications

What does the following: makes it a criminal offense to knowingly and willfully offer, pay, solicit or receive any remuneration for, or in order to induce, referrals.

Anti-Kickback Statute

Budgets can be used for all of the following EXCEPT:

B. An absolute number that must be achieved budget is an operations management tool that presents feedback on a service or product's performance financially. This information is useful to managers in reviewing and adjusting operations.

Kate prepares claims for Palm Coast Orthopedics. Which of the following items would not be needed to be in order for her to send a clean claim?

B. Copies of the patient's previous medical records

The Affordable Care Act has created the necessity of competition between which of the following? A. Healthcare providers and consumers B. Healthcare Providers with each other C. Insurers and Healthcare providers D. Insurers and Consumers

B. Healthcare Providers with each other Providers compete for consumers' choices by competing on value (cost and quality outcomes).

Which of the following statements is true regarding Medicare? . A. Medicare provides insurance to the poor and medically needy. B. Medicare provides insurance coverage to people over 65, persons with disabilities and persons with end-stage renal disease. C. Medicare provides insurance to people over 65 and older. D. All of the above.

B. Medicare provides insurance coverage to people over 65, persons with disabilities and persons with end-stage renal disease. Medicare was established to insure persons over 65, persons with disabilities and those with end-stage renal disease.

Mary Jones is CFO of Island Health System. She and the system CEO believe that it is time for the system to start focusing on value-based payments with health plans in the community. To do so, they will have to shift the way the system sets its strategic objectives. Which of the following statements best describes the changes needed at Island Health System?

B. Reduce emphasis on increasing volume and increase focus on demonstrating high-quality outcomes and patient satisfaction

Occurs when a healthcare provider bills a patient for charges (other than copayments, coinsurance or any amounts that may remain on the patient's annual deductible) that exceed the health plan's payment for a covered service. In-network providers are contractually prohibited from balance billing health plan members, but balance billing by out-of-network providers is common.

Balance Billing

function between a healthcare facility or physician and an insurer is one of the most important resource management challenges in today's healthcare industry.

Billing and Collection

The voluntary Bundled Payments for Care Improvement (BPCI) Initiative with four care models and approximately 591 participants (2018). The two most popular models are hospital plus post-acute care and post-acute care only.

Bundled Payments for Care Improvement

Illustration: Joe does not have insurance. He is showing signs of the flu. He visits a local clinic where he is examined and learns he needs some medicine to relieve his illness. This is Joe. We will be following Joe as his circumstances change to see what effect the changes have on how he pays for his health care. Under these circumstances, Joe will in all probability: Select the best response. A. Pay the full fee to the provider. B. Pay a discounted fee to the provider. C. Both A and B depending on the provider's policies. D. Neither A or B are correct.

C. Both A and B depending on the provider's policies. You selected the correct response. Joe probably will need to pay all or part of the charges he has incurred. While many providers are offering discounted prices to those who pay at the time of service, this is not always the case.

Which of the activities below is not a part of the pre-visit portion of the revenue cycle?

C. Coding -coding occurs when the patient recieves care

Prescription drug coverage for Medicare enrollees, which offsets some of the out-of pocket costs for medications, this covers: A.. Medicare Part A B. Medicare Part B C. Medicare Part D D. Medicare Part F

C. Medicare Part D

Paul is reviewing a claim that was denied for payment by an insurer to the physician clinic where he is employed. Which of the following items might have been an error that resulted in the claim not being paid by the insurer?

C. There were duplicate E&M charges on the claim

Which of the following is NOT a law or regulation with which healthcare entities must comply?

CHIP (Childresns Health Insurance Program) provides health insurance to eligible children. This program is administered by the CMS and individual states

Has multiple parts; one for each revenue producing part

COST DRIVER

What pays a fixed amount Per Member Per Month (PMPM) to a provider in advance as payment for all service necessary to the patient.

Capitation

What is the most common in relationships between primary care physicians and managed care plans such as health maintenance organizations (HMOs)?

Capitation-However, it is also used for specialty physicians as well.

Where is a common area where case rates would be used?

Cardiac surgery

Who are examples of Specialists?

Cardiology, OB/GN, Pathology, and Radiology

The mandatory Care for Joint Replacement (CJR) model with 465 hospital participants in 67 geographic areas (2018).

Care for Joint Replacement

Predetermined amount paid to a healthcare provider for a specified service or range of services.

Case rate

The dollar amount a provider sets for services rendered before negotiating any discounts. The charge can be different from the amount paid.

Charge

The charges by a healthcare facility or physician represent the retail price and are usually compiled in a price listing known as

Chargemaster

The price set by a healthcare facility or physician for their services is referred to as

Charges or Billed Charges

involves staff from the facility working with the health plan to review the medical justification and obtaining a certification of necessity for the patient's continued stay. This process can be resource intensive for both the health plan and provider. As with other prospective payment methods, the facility bears the risk of the cost of care possibly exceeding the per diem payment. Consequently, the facility has the incentive to limit costs and services provided to the patient to only those services deemed necessary for care during that occasion of service.

Concurrent review

The expense related to provided health benefits (premiums or claims paid)

Cost (to the employer)

The amount payable to the provider (or reimbursable to the patient) for services rendered.

Cost (to the health plan/insurer)

The amount payable out of pocket for healthcare services, which may includes deductibles, copayments, coinsurance, amounts payable by the patient for services that are not included in the patient's benefit design, and amounts "balance billed" by out-of-network providers. Health insurance premiums constitute a separate category of healthcare costs for patients, independent of healthcare utilization.

Cost (to the patient)

What is the Medicare program began with a payment mechanism to healthcare facilities that has since been nearly eliminated from the healthcare industry —

Cost based Payment

Mountainside Health Plan is evaluating its payment of hospitals in its current service area. It is looking to reduce its costs per patient and stabilize its overall payments to hospitals. Which of the following payment methods would be least effective for the health plan to meet these objectives?

Cost-based payment You selected the correct answer. Cost-based payment is the least predictable model for a health plan and has the greatest risk of increased cost because it is dependent on the hospital's ability to manage operating costs. The table below shows the methods ranked from most predictable to least predictable.

The expense (direct and indirect) incurred to deliver healthcare services to patients.

Costs (to the provider)

Which of the following statements describes how healthcare can be financed?. A. Patient pays fees directly to the provider. B. Patient pays premiums for individual insurance. The insurer then pays the provider. C. Patient has employer provided insurance. D. All of the above.

D. All of the above. Health care in the U.S. is funded by multiple payers - the patient, commercial insurers and government insurance programs.

Bob Garcia is CEO of La Vida Medical Center and has just ended a meeting with his Chief Financial Officer and Chief Medical Officer. The discussion focused on the need to begin analyzing outcomes and cost. Bob is discouraged after the meeting because of a lack of buy-in from the CFO and CMO. Which of the following might represent a challenge that Bob will have to overcome in order to get analyses done on an ongoing basis?

D. Breaking down silos between finance and clinical staff

Jerry Weir is CEO of the Mountains Health System and is about to meet with the Board of Directors to establish management objectives for the coming year. Historically, these objectives have been set based on growth in service volumes. The sytem has consistently met those volume growth objectives under Jerry's tenure as CEO. Jerry is aware of new opportunities for Mountains Health in the areas of population health and would like to introduce some of those initiatives into future management objectives. Which of the following statements best characterizes the challenge that Jerry may have in setting objectives with his board?

D. Communicating with the Board and educating them about the need to change from objectives based on volume to objectives based on value

Which of the statements below is NOT true regarding provider networks? A. Insurers pay a higher portion of the patient's costs in exchange for the patient using providers within the network. B. There is a perception among patients that networks do not provide a high level of quality care. C. Provider networks were established by insurers to seek discounts on fees. D. Even in emergency situations, the patient must use an in-network provider to receive the highest benefit.

D. Even in emergency situations, the patient must use an in-network provider to receive the highest benefit. Explanation: In a true emergency, patients may seek services with any appropriate provider and still receive agreed-upon benefits

A set of federal compliance regulations to ensure standardization of billing, privacy and reporting as institutions convert to electronic systems is called: A. Health Insurance standard Act B. Reimbursement Insurance Act C. Medicare Reporting Act D. Health Insurance portability and Accountability Ac

D. Health Insurance Portability and Accountability Act

As part of its strategy to become a low-cost, high-value provider that is attractive to health plans in the community, Valley Medical Center is exploring use of bundled payments in a contract with Amalgamated Health Plans. Valley Medical Center has operated in a fee-for-service relationship with Amalgamated for the past twenty years, and has been paid on DRG and case rates during that time. Physicians in the community have admitted patients to the medical center and billed Amalgamated for their services. What areas should Valley Medical Center be attentive to in accepting bundled payments?

D. Identifying an equitable allocation of bundled payments among providers under the contract

_____________ that providers have to pay insurers to cover the cost of defending against the lawsuits and paying large jury awards. A. Ambulatory payment classifications B. Reimbursement Insurance cost plan C. Health proactive Insurance standard act D. Increased insurance premiums

D. Increased insurance premiums

Which of the situations listed below does NOT put inflationary pressure on expenses in the healthcare industry? A. Salaries of healthcare specialty providers B. Healthcare technology C. Risk contracting D. Increased patient volume

D. Increased patient volume Increased patient volume does not create inflationary pressure. However, expenses/costs will increase as more resources are utilized.

Which of the following activities does not occur in the financial department itself? Select the best response. A. Payroll B. Accounting/bookkeeping C. Accounts payable D. Ordering supplies

D. Ordering supplies Finance provides needed fiscal resources for ordering supplies but does not directly place orders for supplies.

Which of the following terms is not a part of the Affordable Care Act's reforms? A. Medical Loss ratio B. Pre-Existing Conditions C. Non-Resiccion D. Spend Down

D. Spend Down Spend down: Refers to the option to use up any existing asset or income to become poor enough to meet medicaid eligibility. This was not addressed in the affordable care act.

For business intelligence data to be useful, it must be available to decision-makers in time for them to take action on it. Clinical measures indicating the quality of patient care should be reported as frequently as possible (almost in real time if possible). Other metrics, such as performance on a capitation contract or income, do not need to be reported as often. A schedule of priorities for the business intelligence function should be established so that managers know when to expect information.

Data availiability

A critical first step in implementing a business intelligence function is to agree on a data strategy that specifies: What data is gathered What is measured A process to protect the accuracy of such data Once this strategy is established, management must decide what metrics will be monitored. In some cases, the metrics monitored will be dictated by government regulators or private health plans. Also, the organization may want to measure other metrics that indicate progress toward strategic objectives.

Data strategy

____________ is the tendency health care practitioners to do more testing and to provide more care for patients than might otherwise be necessary to protect themselves against potential litigation.

Defensive

Most of the challenges in population health management come from managing:

E. All of the above (chronic diseases, duplicate services, risk adjustment, collaboration)

A myriad of gFacility Providers Examples of facility providers include hospitals, skilled nursing facilities, assisted living facilities, home health agencies, and ambulatory surgery centers.

Facility providers

What is a chief enforcement vehicle of the federal govenment that allows the US Department of Health and Human Services to recover monetary damages of up to $11,000 per false claim?

False Claim Act

Who are examples of Primary care physicians:?

Family prac, General, General Internal, and Pediatrics

a charge-based payment mechanism in which a provider is paid either list price (full charges) or a percentage of charges (full charges less a discount) for the specific services rendered.

Fee-for-service

What does the following: Protects patients' health and demographic information (protected health information or PHI) Applies to covered entities (health plans, clearing houses, and healthcare providers) Requires signed authorization by the patient for any use or disclosure not explicitly required or permitted Limits disclosures to minimum necessary information

HIPPA Health Insurance Portability and Accountability Act

An organization that negotiates or sets rates for provider services, collects revenue through premium payments or tax dollars, processes provider claims for service, and pays provider claims using collected premium or tax revenues.

Health Plan/Payer

Congress passed the Patient Protection and Affordable Care Act (ACA or Obamacare) in March 2010 along narrow partisan lines. Its key provisions are what?

Health insurance market reform Medicaid healthcare delivery system transformation

A _________ pays a specified fee for each procedure performed on a patient in a healthcare provider or ambulatory care facility, or by a physician.

Health plan

Quality in this context is defined as a "composite of clinical outcomes, safety and patient experiences with healthcare services."

Healthcare quality

Term which include injuries or infections incurred while the patient is hospitalized.

Hospital Acquired Conditions (HAC)

Primary care delivery model intended to organize providers into a coordinate team meet a patients healthcare needs

Medical Home

The voluntary Oncology Care Model with more than 138 oncologist practices participating in incentives to improve care coordination for chemotherapy patients (2020).

Oncology Care Model

payment also includes amounts for services that are not included in the patient's benefit design and amounts for services balance billed by out-of-network providers. Payments typically does not include premium sharing by the patient.

Out-of-pocket payment

Payment in this definition of value is the "amount paid by all purchasers of healthcare, including the insurer and patient."

Payment for care

which is used primarily for payment to long-term care facilities.

Per diem (or per day) payment system

The total amount a provider expects to be paid by health plans/payers and patients for healthcare services.

Price

In healthcare, readily available information on the price of healthcare services that, together with other information, helps define the value of those services and enables patients and other care purchasers to identify, compare and choose providers that offer the desired level of value

Price Transparency

What type of physicians are usually trained as family practice, general practice, general internal medicine, and pediatrics. Physicians serving in primary care roles usually treat common medical conditions or injuries, and often provide preventive health screenings. Their role is often viewed as: a coordinator of a patient's care, assessing a patient's condition (and treating if simple) or referring a patient to a specialist physician.

Primary

Primary care physicians are usually trained as family practice, general practice, general internal medicine, and pediatrics. Physicians serving in primary care roles usually treat common medical conditions or injuries, and often provide preventive health screenings. Their role is often viewed as: a coordinator of a patient's care, assessing a patient's condition (and treating if simple) or referring a patient to a specialist physician.

Primary Care

What are the 2 different types of physicians?

Primary and Specialists

__________ at 100% of the per-procedure fee

Primary procedure

The three largest third party payers by annual expenditures are:

Private health insurance, Medicare and Medicaid.

Professional Providers Professional providers include physicians, pharmacists, nurses, and allied health professionals (APPs) such as physical therapists, clinical social workers, and others.

Professional Providers

An entity, organization, or individual that furnishes a healthcare service.

Provider

An older term used to describe payment by an insurer to a healthcare facility or physician. This term is used because a physician or healthcare facility provider render services to a patient and then submits claims a claim to an insurer. The healthcare facility or physician waits for processing of that claim by the insurer, and ultimately recieves payment, a determination of payment or a denial by the insurer. Today it is more common to use the term payment.

Reimbursement

defines the increase or decrease adjustment to the payment.

Relative weight (each DRG is assigned relative weight)

What payment approach is the physician payment per procedure or service, varies based on the amount of resources (usually time and effort) needed by the physician.

Resource Based Relative Value Scale (RBRVS)

the flow of money between the patient, the insurer, and the provider of healthcare services

Revenue Cycle

_________ at 50% of the normal per-procedure fee

Secondary procedure

Paul reviews another claim that has been denied payment by an insurer. A problem with coding accuracy was the reason for the denial. Which of the following would be an obvious error in coding accuracy?

Showing a hysterectomy for a male patient showing a hysterectomy for a male patient is an obvious coding error since hysterectomies are not performed on male patients.

Close Specialists Specialists normally do not provide primary care services, instead focusing their work based on in-depth training in different diseases, body systems or types of healthcare service. Examples of specialist physicians include anesthesiology, radiology, pathology, cardiology, obstetrics/gynecology, ophthalmology, orthopedics, psychiatry, general surgery, oncology, neurology, or hospitalist medicine.

Specialists

What type of physicians normally do not provide primary care services, instead focusing their work based on in-depth training in different diseases, body systems or types of healthcare service.

Specialists

What does the following: prohibits physician self-referrals for health services to entities with which the physician or their family has a financial relationship.

Stark I and II

Ryan is reviewing the net days in receivables data and noted that it has increased in the past month. Which of the following would be unimportant in determining why net days in receivables have increased over the past month?

The amount of time required for a new patient to get an appointment has no bearing on why net days in receivables have increased.

What is the difference between case rate and DRG

The difference between case rate and DRG is that the case rate encompasses a group of similar procedures while the DRG can be specific to a unique diagnosis and may or may not include a procedure.

Which of the following would benefit the most from a cost-based payment method?

The healthcare provider That's right! Let's understand how. The payment mechanism is advantageous for healthcare providers, as there is a higher likelihood that all costs will be paid, and there is no incentive to be efficient in providing care, since costs will be reimbursed by the insurer. The rapid escalation of healthcare costs in the U.S. after the start of cost-based payment in Medicare and Medicaid programs led to the implementation of the Prospective Payment System (PPS) of paying acute care healthcare providers for inpatient services in 1983 and outpatient services in 2000. Since then, CMS has introduced prospective payment systems for most other types of institutional healthcare providers Cost-Based payment decreased need for providers to be efficient.

What is the use and benefits of Cost Based Payments?

The only use of this method today is in a limited set of small, rural healthcare facilities known as critical access hospitals. This mechanism has rarely been used for physicians. Cost-based payment calls for the insurer to pay the healthcare provider based on the costs of providing services, with a nominal allowance for margin.

Cons of per diem system

The rate may be higher or lower depending on the type of service the patient receives; that is, per diem or per-day payment for an intensive care unit (ICU) may be higher than the payment for a day in a medical/surgical unit. This differing level of payment recognizes that a provider will spend more to care for a patient in ICU than for the more routine level of care provided in a medical/surgical unit.

_________ 25% of the normal per-procedure fee

Third and Subsequent procedure

The quality of a healthcare service in relation to the total price paid for the service by care purchasers.

Value

What is the outcomes-based payment model about?

about aligning incentives between health plans and providers and reconfiguring the delivery system.

________ involves unintentional actions (errors) that are inconsistent with accepted, sound medical, business or fiscal practices. Abuse carries civil monetary penalties. The burden of proof is lower (preponderance of evidence)

abuse

Which of the doctors involved in Maria's care are considered to be hospital-based physicians? a. primary care b. radiologist c. surgeon d. anesthesiologist e. pathologst

b. radiologist d. anesthesiologist e. pathologist

Work on the budget starts at the lower levels of an organization.

bottoms up

A form of episodic payment in which the health plan pays a single prospective rate for all services provided by physicians, the healthcare provider and post-acute providers.

bundled payment

Which of the reimbursement models below establishes a single prospective rate to all providers involved in a patient's care for the providers to divide equitably among themselves?

bundled payment are payments for specific healthcare services that are intended to be shared among treatement care teams

what are forms of risk based contracts

bundles payments and other shared savings

A process by which organizational data is analyzed and converted into information usable by decision-makers

business intelligence

Ted's hospital bill is $50,000, the surgeon fees are $10,000 and physical therapy is $5,000. Based on the information provided in his profile, what will his total out-of-pocket expense be? a. 1260 b. 2000 c. 4316 d. 10000

c. 4316 You selected the correct response. Ted pays $1,316 for the hospital deductible + (surgeon fee of $10,000 X 20% = $2,000) + (therapy of $5,000 X 20% = $1,000) = $4,316

The average level of severity of conditions of patients in a healthcare provider during a specified period is known as

case mix index

Payment based on a pre-determined amount for a specified service

case rate

What term is: The sources of cash given here (working capital management)

cash

Payment based on billed charges or a percentage discount of charges

charge based

From the perspective of the medical group, charge-based payment poses the least financial risk since the group has control over the amount of services provided and can influence payments by increasing the prices charged to an insurer.

charge based payment

w at terms means: Upon receipt of the claim, the health plan will record the claim in its inventory of claims pending processing in a step known as claim logging. It is customary with the use of electronic billing for the health plan to send an electronic acknowledgment of the claim to the provider.

claim logging

The steps required by the health plan to process the claim for payment is collectively referred to as

claims adjudication.

the ----- process the medical record to assign codes that describe the diagnosis of the patient's condition and the procedures performed during the patient visit.

coding

a percentage of the insurance payment amount that is paid by the patient, along with the amount paid by the insurer.

coinsurance

a flat amount that the patient pays at each time of service

copayment

The amount of indirect or overhead cost to be allocated

cost pool

when providers try to get one payor to pay for costs that have not been covered by another payor, this refers to: A. Cost Capacity B. Cost capitalization C. Cost-shifting D. Prospective cost

cost-shifting

A final critical element in business intelligence, particularly in health [1] care, is a process for maintaining the integrity of data. Data integrity is important not only for accurate reporting of clinical data that could influence patient care, but also for evaluating the costs of care under fixed or prospective payment methodologies. As healthcare information systems become more sophisticated, the amount of data available is increasing rapidly. Business intelligence personnel must closely monitor data accuracy, implement data integrity checks and work with clinical and administrative system users to address user error that could compromise data quality.

data integrity

is a pre-determined amount that the patient pays before the insurer begins to pay for services

deductible

Payment based on a patient's diagnosis

drg

_____ the intentional deception or misrepresentation of facts for gain. _____ carries criminal penalties. The burden of proof is high. (beyond reasonable doubt)

fraud

greatest and least financial risk for the hospital

greatest risk- cost based payment charge based payment DRG Payment Case rate Bundled Payment

The bundled payment model has a predictable cost structure for complex and expensive services.

health plan

Quality in this context is defined as a "composite of clinical outcomes, safety and patient experiences with healthcare services."

healthcare quality

Starts with the actual results of the prior year and is adjusted up or down based on expected future changes.

incremental

least to greatest risk to healthcare providers.

least risk - charge based payment RBRVS Per procedure payment Bundled payment greatest risk - Capitation

Which of the following describes the organization of primary care providers into a coordinated team to meet a patient's healthcare needs?

medical home

are examples of risk-based contracts.

medicare Shared Savings Accountable Care Organizations (MSSP ACOs) established by the Affordable Care Act and the Quality Payment Program (QPP) established by the Medicare and CHIP Reauthorization Act

What does fee for service payment provides?

more units of service in order to receive more payments.

Payment in this definition of value is the "amount paid by all purchasers of healthcare, including the insurer and patient."

payment for care

Payment based on a fixed amount per day

per diem

What health plan reimburses a facility a fixed amount per day for care to a patient

per diem payment system

What are the common discounting approches?

primary , secondary, and third/subsequent procedures

The bundled payment model provides autonomy over how finances are organized.

provider

______ _________ contracts generally overlay a conventional payment methodology (such as fee-for-service, per diem, per case or episodic) with a retrospective settlement mechanism that shares savings (known as upside risk) or losses (downside risk) from the negotiated target. Risk-based contracts may also include provisions that reward providers for achieving certain non-cost related metrics such as quality goals or penalize them for not meeting (or reporting) them.

risk based

_________ the payer (government or commercial) and the provider (or group of providers) share financially in both the risks and the rewards of providing healthcare services at a negotiated rate, giving all parties a financial stake in the contract's performance. (definition)

risk based contract

Lakeside Clinic is planning to renovate its existing building that will decrease the amount of square footage in its pediatric exam rooms by 500 square feet and increase the space in the billing office by 500 square feet. Lakeside Clinic allocates its housekeeping costs to revenue producing departments based on square footage. How will this change affect the allocation of housekeeping costs to the pediatric area?

the amount allocated to pediatrics decreases. The amount allocated for housekeeping will decrease for the pediatric department.

What are benefits of Per Diem system

the per diem payment is administratively easy for the health plan and provides a predictable payment rate that is useful in setting competitive premium rates. However, the facility has a strong incentive to keep a patient longer, since an additional day of service increases payments. This requires the health plan to monitor patient length of stay to verify that the patient stay is only for the number of days that are medically necessary. This process is referred to as concurrent review.

What is the goal of the compliance program?

to prevent fraud and abuse

Senior managers work with finance staff to prepare a budget, and the budget is passed on to staff to implement.

top down

what is a step toward aligning the incentives of healthcare providers and physicians and reducing the sources of this conflict?

value-based payment

Who is someone who discloses information he or she reasonably believes evidences: -a violation of any law, rule, or regulation -gross mismanagement -gross waste of funds -abuse of authority -substantial and specific danger to public health and public safety

whistleblower

Managers start each budget projection as if there were no past experience and each item is justified to its reasonableness each year.

zero based