Health Finance Midterm

Health maintenance organization (HMO) is

A legally incorporated organization that offers health insurance

Value based purchasing

A payment methodology design to provide incentives to providers for delivering quality care at lower costs

T/F: Assets are defined as guaranteed future economic benefits of an organization

False

T/F: Assets include accrued pension

False

T/F: Balance sheet for investor owned entities presents a summary of the entities assets, liabilities, and net assets

False

T/F: GAAP requires certain disclosure (footnote) information to give a more clear picture of the financial position

False

T/F: ICD-10 as a coding system has been used in the U.S for many years

False

T/F: Liquidity refers to long term depth

False

T/F: Litigation under the ACA was significantly addressed

False

T/F: Methods of health care financing remain unchanged

False

T/F: Value based payment has been a part of Medicare since its inception

False

T/F: Value-based purchasing is designed to address on quality of care initiatives

False

Medicare's value-based payment demonstrations have had what effect on expenditures

Little to no effect

All of the following could contribute to a decrease in health care costs except

Medical technology continuing to develop new systems

The ACA provides a _____ benefits package

Minimum benefits package

An asset mix strategy includes

The amount of working capital an organization keeps on hand relative to working capital obligations

T/F: ACO's are voluntary groups of health care providers who coordinate care to a patient population

True

T/F: Net assets section of a balance sheet for not for profits is analogous to the owner and equity on a for profit balance sheet

True

T/F: Providers spend a significant amount of time & expense addressing compliance

True

T/F: Recovery audit contractors (RAC) auditors are independent contractors hired by CMS

True

T/F: The basic accounting equation is assets = liabilites + net assets

True

T/F: U.S Health systems goals remain unchanged

True

Vertical analysis answers which general question

What percentage of one-line item is another line item

Present value of an annuity refers to

What series of equal payments in the future is worth today taking into account time value of money

The statement of changes in net assets includes

Why there was a change from one year to the next in the entire net asset section of the balance sheet

Trend analysis compare changes over

each year with the base year

Approaches to analyze financial statements do not include

Collateral analysis

The number of uninsured citizens in the United States rose between 2001-2010 to

36-50 million people

The Medicare program was enacted as a part of the social security act in

1965

Hospital reimbursement by Medicare includes

A & B (Case rates and ambulatory payment classifications)

Analyzing financial statements helps a healthcare organization to

A & B (determine if profitable and determine the effectiveness in collection receivables)

Sources of temporary cash include

A & B (line of credit & commitment fees)

State of operations includes

A & B (operating expenses and increase in unrestricted net assets)

Methods to monitor accounts receivable

A & C (net accounts receivable & aging schedule)

What is the traditionally used accounting type in health care

Accrual

Categories of ratios include

All of the Above

A statement of cash flows include

All of the above

Accountable care organizations (ACO) performance is measured by

All of the above

Part of revenue cycle is

All of the above

Recording transactions assits in

All of the above

The working capital cycle includes

All of the above

Which of the following is basic financial statement?

All of the above

Which of the following is the goal of the United States Quality Health Care Association

All of the above

The objectives of the US healthcare payment system inlcude

All of the above (cost, access, quality)

Age of point ratio provides

An indication of the average age of a hospital

Collecting cash payments includes

B & C (lockboxes and wire transfer)

Body of the statement of cash flows does not include

Current Liabilities

To develop financial statements, transactions

Have been analyzed and recorded

A statement of operations summarizes the organizations total assets, liabilities, and net assets in what time?

Over a period of time

ACA stands for

Patient Protection Affordable Care Act

All of the following factors contribute to the rising costs in health care except

Providers embrace lean six sigma & other techniques to deliver better care with less resources

Cash flows from investing activities include

Purchase of plant property and equipment

Other revenues refers to all of the following except

Salary and wages

Which of the following is not a point to consider when using and interpreting ratios

With benchmarking it is not necessary to make sure the same formula is used

Future value is determined using

a compound interest method

Trade payable are referred to as

accounts payable

Future value table is used

as an alternative to calculate future value....

Finance mix strategy includes

cash management

Assets are defined as

cash, investments, inventory, and recievables

Vertical analysis is also called

common size analysis

Time value of money refers to

concept that a dollar today is always worth more than a dollar tomorrow

Discounting is

converting cash flows into their present value

Liabilities are defined as

financial obligations due within a year

Which of the following is not a major reason to hold cash

hedge against inflation

compound interest methods refer to

interest is calculated on both the original principal and on all interest accumulated since the beginning of interest period

The "book" refers to transactions

journal recorded chronologically

Transactions summarized by account are called

ledger

In the healthcare payment system, there are various stakeholders. These include..

patients

Operating margin ratio measures

profits earned from the organizations main line of business

In the accrual accounting method

revenues are recognized when revenues are earned

Balance sheet for a non-profit contains all of the following except

stockholders equity

Present Value (PV) refers to

the current value of future cash flows discounted at the appropriate discount rate