Deck 1: The Environment of Healthcare Finance

Question 1

Healthcare is more heavily regulated than most other businesses in the United States.

Answer 1

True

Question 2

Most proprietorships form professional corporations in order to ____.

A) reduce taxes
B) raise capital by selling shares
C) reduce malpractice liabilities
D) reduce financial liabilities

Answer 2

reduce financial liabilities

Question 3

The Tax Equity and Fiscal Responsibility Act of 1982 resulted in ____.

A) fee-for-service plans for Medicare
B) preferred provider insurance plans
C) a prospective payment system for Medicare
D) for-profit hospital corporations

Answer 3

a prospective payment system for Medicare

Question 4

Which type of healthcare insurance plan uses primary care clinician gatekeepers to coordinate the care of plan participants?

A) capitation plan
B) health maintenance organization
C) preferred provider plan
D) fee-for-service plan

Question 5

Which of the following private-sector companies provides hospitalization insurance?

A) Medicare
B) Medicaid
C) Blue Shield
D) Blue Cross

Question 6

Prior to 1930, hospitals in America received most of their funding from ____.

A) charitable donations
B) city governments
C) patient payments
D) physician organizations

Question 7

Federal tax revenues are based on a C Corporation's ____.

A) gross revenues
B) net revenues and profits
C) dividends
D) profits and dividends

Question 8

If you own stock in a publicly-held corporation that becomes bankrupt, you will ____.

A) be billed for a portion of legal costs
B) lose only the value of your stocks
C) owe a portion of the corporation's debt
D) owe a portion of the corporation's unpaid taxes

Question 9

A not-for-profit hospital must ____.

A) be operated by a religious organization
B) adopt a corporate structure
C) have annual stockholder meetings
D) be staffed by volunteers

Question 10

What situation resulted in the rapid increase of employer-sponsored healthcare insurance during World War II?

A) rationing
B) wage freezes
C) socialism
D) government mandate

Question 11

Capitated payment plans were common before 1965.

Question 12

Ambulatory care refers to services provided by paramedics or emergency medical technologists while transporting a patient to a hospital.

Question 13

A recent trend in healthcare is the growth of public corporations that own multiple hospitals and other healthcare facilities.

Question 14

Which type of healthcare reimbursement system pays a fixed amount per patient?

A) Medicaid
B) capitation
C) third-party insurance
D) healthcare maintenance organization

Question 15

Which of the following financial management issues differentiates healthcare from other businesses?

A) operating budgets
B) need for cash flow
C) third-party payers
D) accounting method

Question 16

The emergency department of a hospital is ____.

A) an in-patient facility
B) an out-patient facility
C) a tax-exempt facility
D) a non-classified facility

Question 17

When Medicare and Medicaid were established in 1965, their costs increased much more than government planners expected. What was changed in 1982 in an attempt to keep costs down?

A) Physicians were given incentives to use fewer resources.
B) Patients were given incentives to improve their health.
C) Hospital budgets were controlled by the federal government.
D) Payments to healthcare providers were based on patients' diagnoses.

Question 18

A small, closely held corporation is owned by ____.

A) a parent corporation
B) public stockholders
C) private investors
D) a proprietorship

Question 19

The Hospital Survey and Construction Act of 1946 produced ____.

A) an increase in the availability of in-patient hospital services
B) a doubling in the number of not-for-profit hospitals
C) a decrease in hospital charges due to greater competition
D) a five-year increase in life expectancy of Americans

Question 20

Home healthcare services are in decline because providing services at home is not cost effective.

Question 21

The controlling entity of a for-profit, investor-owned hospital is the ____________________.

Question 22

A group of physicians who do not want to incorporate but want to reduce their financial risks should form a(n) ____________________.

Question 23

What circumstances in the first half of the twentieth century caused many hospitals in America to charge fees for their services?

Question 24

Explain why employer-sponsored healthcare insurance in America increased during World War II.

Question 25

The change that had the biggest financial impact on hospitals in the 1980s and 1990s was ____.

A) the unionization of nurses and other caregivers
B) the loss of federal tax-exemptions
C) the reimbursement based on patient diagnoses
D) federal grants for new hospitals and hospital expansions

Question 26

Describe the financial advantages of a not-for-profit hospital over a for-profit hospital.

Question 27

The legal document required in most states for expanding a hospital is a(n) ____________________.

Question 28

What factors contributed to the rapid cost increases of the Medicare and Medicaid programs in the 1960s, 1970s, and early 1980s?

Question 29

Nursing home costs for elderly Americans ____.

A) are covered by Medicare
B) are mostly covered by long-term care insurance
C) are decreasing because of improved medications
D) are mostly covered by Medicaid

Question 30

Describe recent trends in long-term care services in America.

Question 31

Hospice care ____.

A) extends the life of patients
B) requires a dedicated facility
C) is for patients and their families
D) is not reimbursed by insurers or Medicare

Question 32

The original Medicare and Medicaid programs reimbursed hospitals using a(n) ____________________ system.

Question 33

The responsibility for medical services at most hospitals lies with ____.

A) the chief executive officer
B) the chief of staff
C) the board of directors
D) the board of trustees

Question 34

Home healthcare services ____.

A) have been decreasing since the 1980s
B) are less cost-effective than hospitals
C) are eligible for Medicaid and Medicare reimbursement
D) must be overseen by a physician

Question 35

A not-for-profit healthcare business must be structured as a(n) ____________________.