This document contains 30 multiple choice questions from a Liberty University BUSI 311 quiz on healthcare finance topics. The questions cover a range of issues including types of health plans, Medicaid/Medicare policies and eligibility, the Affordable Care Act, cost control efforts, and more. Sample questions addressed managed care options, provisions of the Medicare Prescription Drug Act, factors that increase Medicaid spending, and coverage exclusions under Medicare.

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Question 1 Access to the care of specialist physicians is limited in which type of health plan?
Question 2 Which type of HMO offers the most flexibility for participating physicians?
Question 3 The primary reasons why materials management is so important to healthcare
organizations include all of the following except
Question 4 The commonly accepted method for valuing inventory that produces an inventory of
newer items is referred to as
Question 5 The Medicare Prescription Drug, Improvement & Modernization Act of 2003 includes
provisions to:
Question 6 The types of costs that change directly in relation to changes in volume are called
Question 7 The Medicare prospective payment system for reimbursing hospitals utilizes
Question 8 A high deductible health plan with a savings option represents a form of consumer
driven health plan that:
Question 9 In the wake of health care reform, most health care executives believe that the new
reform policies will:
Question 10 Private health insurance coverage includes the following types:
Question 11 The growth in health insurance in the U.S. came about as a result of:
Question 12 Using working capital to enhance "good will" toward the healthcare organization
includes
Question 13 The volume of production in units and sales of goods or services, where total costs
equal total revenues, is called
Question 14 Problems associated with the care of active military personnel and retirees include all
of the following EXCEPT:

2. Question 15 The primary reason that healthcare managers should be concerned about healthcare
financing and health insurance is:
Question 16 Bad debt in health care finance is defined as:
Question 17 The primary preparers of capital budget requests are the
Question 18 The difference between a hospital's charges for an inpatient stay in the facility and
the amount the hospital has agreed to accept from the patient's insurance carrier is called
Question 19 Many of those who are uninsured:
Question 20 Medicaid provides coverage for lowincome individuals who
Question 21 Which of the following is NOT a characteristic of notforprofit healthcare organizations?
Question 22 Unlike other organizations, healthcare organizations tend to generate very little
immediate cash because of
Question 23 Medicaid spending increases are the result of:
Question 24 The Patient Protection and Affordable Care Act includes provisions for the following:
Question 25 Efforts to control the costs of Medicare have been undertaken via legislation
mandated to create prospective payment systems for
Question 26 Which of the following is characteristic of the way the uninsured utilize the health
care system?
Question 27 In purchasing health insurance, which of the following is NOT typically a
consideration?
Question 28 The primary goal of managing accounts receivable is to
Question 29 Current assets may include:
Question 30 The Balanced Budget Act of 1997 implemented cost controls for Medicare
expenditures in all of the following healthcare sectors except
A high deductible health plan with a savings option represents a form of
consumer driven health plan that

3. Access to the care of specialist physicians is limited in which type of health
plan?
CHIP is a program that provides for
Cost sharing is required of those covered by:
Efforts to control the costs of Medicare have been undertaken via legislation
mandated to create prospective payment systems for
In purchasing health insurance, which of the following is NOT typically a
consideration?
Individuals who have coverage under the Medicare Program include:
Many of those who are uninsured:
Medicaid provides coverage for low-income individuals who
Medicaid spending increases are the result of:
Medicare includes coverage of all of the following EXCEPT:
Medicare spending has increased as a result of:
Private health insurance coverage includes the following types:
Problems associated with the care of active military personnel and retirees
include all of the following EXCEPT:
The growth in health insurance in the U.S. came about as a result of:
The Medicare Prescription Drug, Improvement & Modernization Act of 2003
includes provisions to:
The Patient Protection and Affordable Care Act includes provisions for the
following:
The primary reason that healthcare managers should be concerned about
healthcare financing and health insurance is:
The TRICARE military healthcare system provides coverage for
Which of the following is characteristic of the way the uninsured utilize the
health care system?
Which type of HMO offers the most flexibility for participating physicians?
Which type of managed care offers patients flexibility in accessing their
physician of choice?
Who bears the costs of providing care to the uninsured?
The chief financial officer (CFO) of a hospital supervises all of the
following officers except
A. The Independent Auditor
B. The Treasurer
C. The Controller
D. The Internal Auditor
The volume of production in units and sales of goods or services,
where total costs equal total revenues, is called
A. Factoring receivables
B. Cash flow
C. The economic order quantity
D. The break-even point
Primary sources of working capital include all of the following
except
A. Net income, or profits
B. Equipment

4. C. Inventory
D. Investments
The primary preparers of capital budget requests are the
A. CEO and CFO
B. Department managers
C. Facilities management staff
D. Accounting staff
The determination of the total cost of producing a specified
healthcare service through assigning costs into revenue-
producting departments is referred to as
A. Classifying costs
B. Assembling costs
C. Cost allocation
D. Activity-based costing
Setting prices in healthcare organizations involves consideration of
all of the following except
A. The amount of current accounts receivable
B. Other competitors in the market
C. The perceived value of goods and services
D. Money actually spent
The difference between a hospital's charges for an inpatient stay in
the facility and the amount the hospital has agreed to accept
from the patient's insurance carrier is called
A. A contactual allowance
B. Uncompensated care
C. Capitation
D. Fee-for-service
The primary reasons why materials management is so important to
healthcare organizations include all of the following except
A. Appropriate patient care
B. Improving the organization's profitability
C. Controlling costs of materials and inventory
D. Developing close relationships with vendors
The Balanced Budget Act of 1997 implemented cost controls for
Medicare expenditures in all of the following healthcare sectors
except
A. Skilled nursing facilities
B. Pharmaceutical companies
C. Home health agencies
D. Outpatient hospitals and clinics
Bad debt in health care finance is defined as:
A. billing for services rendered but no payment is received
B. debt that is owed by the health care organization

5. C. charity care provided by not-for profit organizations
D. patient care that is provided on a charity basis
In the wake of health care reform, most health care executives
believe that the new reform policies will:
A. Have a negative financial impact on their facilities
B. Improve the bottom line of their organizations
C. Increase employee productivity
D. Not change the way that their finance departments are
operated
The types of costs that change directly in relation to changes in
volume are called
A. Indirect costs
B. Variable costs
C. Direct costs
D. Fixed costs
The type of budget that forecasts cash inflows and cash outflows
for the next fiscal year is called the
A. Operating or cash budget
B. Capital budget
C. Statistics budget
D. Expense budget
Current assets may include:
A. Property
B. Accounts receivable
C. Cash on hand
D. A & C only
E. B & C only
The primary goal of managing accounts receivable is to
A. Reduce the collection period for payment for services
B. Collect revenue for investment opportunites
C. Generate "good will" for the organization
D. Increase the collateral for negotiating a line of credit with
lenders
Capital budgets may include all of the following except
A. Information technology infrastructure
B. Net lending or borrowing needs of the organization
C. Land or facility acquisition
D. Recruitment of staff physicians
Health care financial management involves:
A. Oversight of day to day financial operations
B. Increasing revenues and decreasing costs
C. Planning the organizations long-range financial direction
D. None of the above
E. All of the above

6. CMI is an acronym that stands for:
A. Center for Mediation Issues
B. Centralized Management Inventory
C. Center for Medicare and Medicaid Innovation
D. Cost Management Industry
The commonly accepted method for valuing inventory that
produces an inventory of newer items is referred to as
A. FIFO, or "first-in, first-out"
B. Weighted average
C. Specific identification
D. LIFO, or "last-in, last-out"
The Medicare prospective payment system for reimbursing
hospitals utilizes
A. The RBRVS system
B. A "Cost Plus" charging system
C. DRGs
D. Per diem rates
True or False? Catastrophic health insurance coverage is the most
commonly purchased type of health insurance today
True or False? Changes in the extent to which individuals have
health insurance coverage in times of economic downturn tend
to be absorbed by private health plans, rather than public ones.
True or False? Comprehensive health insurance coverage typically
includes hospital coverage, but not physician services.
True or False? Elderly Medicaid beneficiaries account for the
majority of the program's spending.
True or False? Enrollment in conventional indemnity health
insurance plans has increased in the past 15 years.
True or False? Funding for the Medicare Program is derived only
from federal taxes.
True or False? Health insurance policies have not used lifetime
limits to control total exposure for the costs of care.
True or False? Medicaid and Medicare are private insurance
programs administered by the federal government
True or False? Medicaid is a federally-mandated program that is
administered by the states.
True or False? Medicaid programs are uniform across the states.
True or False? Public sources of funding accounted for slightly less
than half of all expenditures for health care in 2008.
True or False? Risk is a concept in health insurance that involves a
group sharing the costs of losses incurred by the members of
the insurance pool.

7. True or False? The Centers for Medicare & Medicaid Services
project that health spending will be 30% of GDP by 2012.
True or False? The health plans provided for under Part C of
Medicare are sometimes referred to as Medicare Advantage
(MA) plans.
True or False? The majority of the uninsured population is
comprised of adults aged 35 and older.
True or False? The Patient Protection and Affordable Care Act of
2010 calls for changes that will impact insurers, businesses,
consumers, and healthcare providers.
True or False? The VA has programs that cover children with
certain birth defects born to female Vietnam Veterans.
True or False? The Veterans Health Administration is the largest
health care system in the world.
The difference between a hospital's charges for an inpatient stay in
the facility and the amount the hospital has agreed to accept
from the patient's insurance carrier is called
Which of the following is NOT a possible outcome of the decision-
making process in cost accounting in healthcare organizations?
The determination of the total cost of producing a specified
healthcare service through assigning costs into revenue-
producing departments is referred to as
The types of costs that change directly in relation to changes in
volume are called
Private health insurance coverage includes the following types
The growth in health insurance in the U.S. came about as a result
of:
In purchasing health insurance, which of the following is NOT
typically a consideration?
Which type of HMO offers the most flexibility for participating
physicians?
Which type of managed care offers patients flexibility in accessing
their physician of choice?
Access to the care of specialist physicians is limited in which type
of health plan?
Efforts to control the costs of Medicare have been undertaken via
legislation mandated to create prospective payment systems for
The Medicare Prescription Drug, Improvement & Modernization Act
of 2003 includes provisions to:
The chief financial officer (CFO) of a hospital supervises all of the
following officers EXCEPT
The Medicare prospective payment system for reimbursing
hospitals utilizes

8. Which of the following is NOT a characteristic of not-for-profit
healthcare organizations?
The Balanced Budget Act of 1997 implemented cost controls for
Medicare expenditures in all of the following healthcare sectors
EXCEPT
The largest category of healthcare workers is:
Residency Training lasts from ___to ___, depending on the
specialty.
Resident work hours have changed due to
Licensure is
Criminal Background Checks for nurses and physicians are
Board certification is:
CME is
Physician credentialing is:
Which of the following indicates the need for more health care
workers in the future?
Which of the following is an example of an "employee retention"
function?
Incentive compensation is believed to have what effect on
employee performance?
Performance appraisals are useful to
Not all HR functions are carried out exclusively by HR staff. Which
of the following would be carried out by line managers?
Flexible benefits are helpful to employees because:
Recent information from the literature concerning employee
perceptions suggests that:
Job analysis is necessary to:
A team is:
One of the ways to engage medical staff is to:
Some of the benefits of effective healthcare team are:
Which of the following is NOT correct about Cross Functional
Teams (CFTs)?
Teamwork is taught in:
Participation in the VHA Medical Team Training program was
associated with:
To convince higher level management that teamwork is worth the
effort, one should point to:
Nursing turnover costs are about:
Select all the terms that can be used interchangeably with cultural
competency.
Concerns with the term cultural competence include
The National Standards on Culturally and Linguistically Appropriate
Services provide for:

9. A hospital can demonstrate inclusivity by community engagement
through:
Public policies to address health disparities could include:
Vulnerable populations are more exposed to risks from:
Benefits of a diverse health care workforce include
By 2050, more than half the population of the U.S. will be
comprised of minorities.
Which of the following is not a primary source of ethics?
What are the main sources of American law?
What are some of the ways in which healthcare organizations
protect the rights of their patients?
A wrong against society as a whole, even if a particular individual
is harmed, is considered a violation of which type of law?
Contract violations are generally considered to be part of which
type of law?
Which of these elements is NOT necessary for a contract to be
binding?
A wrongful act against a person or organization is considered what
type of violation?
For a health provider's action to be considered negligent, which of
the following factors is NOT necessary?
The investigative and enforcement authority to deal with fraud and
abuse violations was granted to the Department of Health and
Human Services (DHHS) through?
Examples of healthcare fraud and abuse include?
Violations of the Criminal Disclosure Provision of the Social
Security Act include penalties of
An example of a Stark Law violation is:
Violations of the Emergency Medical Treatment and Active Labor
Act (EMTALA) include all of the following, except:
The Anti-Kickback Statutes
Seven Essential Elements of An Effective Compliance Program
include:
ORT is an acronym that stands for
Many of those who are uninsured:
A. Are workers who are employed in industries that do not
provide health insurance
B. Do not have access to routine health care
C. Are American citizens
D. All of the above
Medicaid provides coverage for low-income individuals who
A. Receive Temporary Aid to Needy Families (TANF)
assistance
B. Receive Supplemental Security Income (SSI) assistance

10. C. Are pregnant
D. Are elderly
E. All of the above
True or False? The majority of the uninsured population is
comprised of adults aged 35 and older.
True
False
The Medicare Prescription Drug, Improvement & Modernization Act
of 2003 includes provisions to:
A. Fund rural hospitals
B. Create Part D of Medicare
C. Increase prevention benefits for seniors
D. All of the above
Which type of managed care offers patients flexibility in accessing
their physician of choice?
A. Preferred Provider Organization
B. Point of Service Plan
C. Health Maintenance Organization
D. All of the above
E. A and B above
CHIP is a program that provides for
A. Children covered by Medicare
B. All children
C. Children covered by Medicaid
D. Children in low income families who would not typically
qualify under Medicaid
Which type of HMO offers the most flexibility for participating
physicians?
A. Closed-panel HMO
B. Independent Practice Association
C. Open-panel HMO
D. None of the above
Cost sharing is required of those covered by:
A. HMOs
B. PPOs
C. Medicare
D. Medicaid
E. All of the above
The primary reason that healthcare managers should be
concerned about healthcare financing and health insurance is:
A. It's the right thing to do
B. It's important to the organizations' bottom line and to
organizational success
C. Employees are concerned about the increases in their share

11. of premiums and other cost sharing
D. All of the above
Medicaid spending increases are the result of:
A. Expansion of services of many types
B. Expansion of eligibility to include all children
C. Rising unemployment and increases in the uninsured
D. A and C above
E. All of the above
Medicare includes coverage of all of the following EXCEPT:
A. Presceiption drugs under Part D
B. Mental health care under Part E
C. Inpatient hospital care under Part A
D. Physician services and outpatient care under Part B
Access to the care of specialist physicians is limited in which type
of health plan?
A. Point of Service Plan
B. Conventional Plan
C. Health Maintenance Organization
D. Preferred Provider Organization
E. All of the above
Who bears the costs of providing care to the uninsured?
A. The uninsured
B. Philanthropic contributions
C. Local governments
D. Everyone, including all of the above
In purchasing health insurance, which of the following is NOT
typically a consideration?
A. Liability
B. Deductibles and copays
C. Benefit package
D. Provider Choice
A. Preferred Provider Plans
B. Health Maintenance Organizations
C. Indemnity Plans
D. All of the above
Problems associated with the care of active military personnel and
retirees include all of the following EXCEPT:
A. Access to care in rural areas
B. Access to medical centers in major metropolitan areas
C. Access to care for reservists and other temporary personnel
D. None of the above
The growth in health insurance in the U.S. came about as a result
of:
A. The rising cost of health care

12. B. The increased government role in providing access to care
C. The involvement of unions and collective bargaining D. All of
the above
A high deductible health plan with a savings option represents a
form of consumer driven health plan that:
A. Encourages the purchaser to be more aware of the cost of
care
B. Encourages the consumer to use preventive types of health
care
C. Is usually lower cost than other types of plans
D. Requires the consumer to pay a large amount out-of-pocket
before the plan kicks in
E. All of the above
Which of the following is characteristic of the way the uninsured
utilize the health care system?
A. They delay seeking care, eventually ending up in emergency
rooms
B. They can afford to pay for care out-of-pocket
C. They utilize preventive care to maintain wellness
D. They have a primary care physician
The Patient Protection and Affordable Care Act includes provisions
for the following:
A. Improving quality.
B. Expanding Medicaid.
C. Allowing greater access to long-term care insurance
coverage.
D. Providing access to health care for all Americans.
E. All of the above.
E. All of the above
A high deductible health plan with a savings option represents a
form of consumer driven health plan that
of specialist physicians is limited in which type of health plan?
CHIP is a program that provides for
Cost sharing is required of those covered by:
Efforts to control the costs of Medicare have been undertaken via
legislation mandated to create prospective payment systems for
In purchasing health insurance, which of the following is NOT
typically a consideration?
Individuals who have coverage under the Medicare Program
include:
Many of those who are uninsured:
Medicaid provides coverage for low-income individuals who
Medicaid spending increases are the result of:
Medicare includes coverage of all of the following EXCEPT:

13. Medicare spending has increased as a result of:
Private health insurance coverage includes the following types:
Problems associated with the care of active military personnel and
retirees include all of the following EXCEPT:
The growth in health insurance in the U.S. came about as a result
of:
The Medicare Prescription Drug, Improvement & Modernization Act
of 2003 includes provisions to:
The Patient Protection and Affordable Care Act includes provisions
for the following:
The primary reason that healthcare managers should be
concerned about healthcare financing and health insurance is:
The TRICARE military healthcare system provides coverage for
Which of the following is characteristic of the way the uninsured
utilize the health care system?
Which type of HMO offers the most flexibility for participating
physicians?
Which type of managed care offers patients flexibility in accessing
their physician of choice?
Who bears the costs of providing care to the uninsured?
True or False? Catastrophic health insurance coverage is the most
commonly purchased type of health insurance today
True or False? Changes in the extent to which individuals have
health insurance coverage in times of economic downturn tend
to be absorbed by private health plans, rather than public ones.
True or False? Comprehensive health insurance coverage typically
includes hospital coverage, but not physician services.
True or False? Elderly Medicaid beneficiaries account for the
majority of the program's spending.
True or False? Enrollment in conventional indemnity health
insurance plans has increased in the past 15 years.
True or False? Funding for the Medicare Program is derived only
from federal taxes.
True or False? Health insurance policies have not used lifetime
limits to control total exposure for the costs of care.
True or False? Medicaid and Medicare are private insurance
programs administered by the federal government
True or False? Medicaid is a federally-mandated program that is
administered by the states.
True or False? Medicaid programs are uniform across the states.
True or False? Public sources of funding accounted for slightly less
than half of all expenditures for health care in 2008.

14. True or False? Risk is a concept in health insurance that involves a
group sharing the costs of losses incurred by the members of
the insurance pool.
True or False? The Centers for Medicare & Medicaid Services
project that health spending will be 30% of GDP by 2012.
True or False? The health plans provided for under Part C of
Medicare are sometimes referred to as Medicare Advantage
(MA) plans.
True or False? The majority of the uninsured population is
comprised of adults aged 35 and older.
True or False? The Patient Protection and Affordable Care Act of
2010 calls for changes that will impact insurers, businesses,
consumers, and healthcare providers.
True or False? The VA has programs that cover children with
certain birth defects born to female Vietnam Veterans.
True or False? The Veterans Health Administration is the largest
health care system in the world.
A high deductible health plan with a savings option represents a form of
consumer driven health plan that
Access to the care of specialist physicians is limited in which type of health
plan?
CHIP is a program that provides for
Cost sharing is required of those covered by:
Efforts to control the costs of Medicare have been undertaken via legislation
mandated to create prospective payment systems for
In purchasing health insurance, which of the following is NOT typically a
consideration?
Individuals who have coverage under the Medicare Program include:
Many of those who are uninsured:
Medicaid provides coverage for low-income individuals who
Medicaid spending increases are the result of:
Medicare includes coverage of all of the following EXCEPT:
Medicare spending has increased as a result of:
Private health insurance coverage includes the following types:
Problems associated with the care of active military personnel and retirees
include all of the following EXCEPT:
The growth in health insurance in the U.S. came about as a result of:
The Medicare Prescription Drug, Improvement & Modernization Act of 2003
includes provisions to:
The Patient Protection and Affordable Care Act includes provisions for the
following:
The primary reason that healthcare managers should be concerned about
healthcare financing and health insurance is:
The TRICARE military healthcare system provides coverage for
Which of the following is characteristic of the way the uninsured utilize the
health care system?
Which type of HMO offers the most flexibility for participating physicians?

15. Which type of managed care offers patients flexibility in accessing their
physician of choice?
Who bears the costs of providing care to the uninsured?