HFMA CHFP COMPREHENSIVE EXAM
PREP QUESTIONS AND SOLUTIONS
VERIFIED STUDY RESOURCE
●● Break-even point
Answer: Level of sales volume of a product producing the exact amount
of contribution margin needed to cover fixed costs.
●● Overhead
Answer: Indirect Costs
●● Activity-based costing (ABC)
Answer: Method of determining product costs using cost drivers or
activity measures, which cause indirect costs to be incurred.
●● Three main types of Cost standards.
Answer: Predetermined (Synthetic), Negotiated (Historical), and
Customized (Engineered)
●● Four Types of Individual Cost behaviors
Answer: Variable, Fixed Cost Pattern, Semi-Variable Cost Pattern, Semi-
Fixed or Stepped Variable
,●● Three Principal Types of expense variances
Answer: Price, Volume, and Efficiency
●● The 4 Primary payment methods used in managed care
Answer: Fee-for-Service, Per Diem Rate, Case Rate, Capitation
●● Healthcare providers should develop different modeling tools
depending on
Answer: the reimbursement method proposed in the contract
●● The general categories of provider excess loss insurance are
Answer: per-person, aggregate, and carve-out.
●● A Strategic Plan allows organizations to
Answer: have a clear plan as to why they are in business and how they
can stay in business in the future.
●● The main types of control budgets include
Answer: operating, capital, and cash.
●● A budgeting process develops assumptions for the following:
,Answer: Admissions, ALOS, Expense per visit, Inflation on expense,
FTE per visit, Productivity on FTE per visit, Labor cost per FTE, Net
Rev per visit
●● Operating budget's statistical factors include
Answer: Historical statistics, Historical relationship of department
volume, anticipated effects of new programs, clinical practice patters,
covered lives in global payment risk programs, changes in regulatory
environment, technical developments, process improvements, marketing
efforts, demographic trends
●● The primary purpose of measuring productivity is
Answer: for management to determine if resources are being used
efficiently
●● Budget types include
Answer: fixed and flexible
●● The four budget variances used to explain by cause are
Answer: Volume, rate (charged), price (of a supply), and efficiency (cost
per procedure).
●● Three common Capital Evaluation techniques
Answer: Payback, Net Present Value Method, Return on Investment
, ●● Users of ratio analysis
Answer: Board of Directors, Management, Health Systems Agencies,
Creditors, Employee Unions, Rate Regulators
●● The categories of ratios used
Answer: Profitability Ratios, Liquidity Ratios, Activity Ratios, Capital
Structure Ratios
●● Two common types of long-term debt
Answer: Revenue bonds and General Obligation Bonds
●● Undertake debt restructuring by either retiring or reacquiring existing
debt for 4 reasons
Answer: Take advantage of lower interest rates, change collateral
restrictions, allow acquisition of other assets, better fit debt service
requriements
●● Healthcare bond issues place legal obligations on
Answer: the borrower intended to protect the lender against default by
the borrower.
●● In order to use the discounted cash flow method
PREP QUESTIONS AND SOLUTIONS
VERIFIED STUDY RESOURCE
●● Break-even point
Answer: Level of sales volume of a product producing the exact amount
of contribution margin needed to cover fixed costs.
●● Overhead
Answer: Indirect Costs
●● Activity-based costing (ABC)
Answer: Method of determining product costs using cost drivers or
activity measures, which cause indirect costs to be incurred.
●● Three main types of Cost standards.
Answer: Predetermined (Synthetic), Negotiated (Historical), and
Customized (Engineered)
●● Four Types of Individual Cost behaviors
Answer: Variable, Fixed Cost Pattern, Semi-Variable Cost Pattern, Semi-
Fixed or Stepped Variable
,●● Three Principal Types of expense variances
Answer: Price, Volume, and Efficiency
●● The 4 Primary payment methods used in managed care
Answer: Fee-for-Service, Per Diem Rate, Case Rate, Capitation
●● Healthcare providers should develop different modeling tools
depending on
Answer: the reimbursement method proposed in the contract
●● The general categories of provider excess loss insurance are
Answer: per-person, aggregate, and carve-out.
●● A Strategic Plan allows organizations to
Answer: have a clear plan as to why they are in business and how they
can stay in business in the future.
●● The main types of control budgets include
Answer: operating, capital, and cash.
●● A budgeting process develops assumptions for the following:
,Answer: Admissions, ALOS, Expense per visit, Inflation on expense,
FTE per visit, Productivity on FTE per visit, Labor cost per FTE, Net
Rev per visit
●● Operating budget's statistical factors include
Answer: Historical statistics, Historical relationship of department
volume, anticipated effects of new programs, clinical practice patters,
covered lives in global payment risk programs, changes in regulatory
environment, technical developments, process improvements, marketing
efforts, demographic trends
●● The primary purpose of measuring productivity is
Answer: for management to determine if resources are being used
efficiently
●● Budget types include
Answer: fixed and flexible
●● The four budget variances used to explain by cause are
Answer: Volume, rate (charged), price (of a supply), and efficiency (cost
per procedure).
●● Three common Capital Evaluation techniques
Answer: Payback, Net Present Value Method, Return on Investment
, ●● Users of ratio analysis
Answer: Board of Directors, Management, Health Systems Agencies,
Creditors, Employee Unions, Rate Regulators
●● The categories of ratios used
Answer: Profitability Ratios, Liquidity Ratios, Activity Ratios, Capital
Structure Ratios
●● Two common types of long-term debt
Answer: Revenue bonds and General Obligation Bonds
●● Undertake debt restructuring by either retiring or reacquiring existing
debt for 4 reasons
Answer: Take advantage of lower interest rates, change collateral
restrictions, allow acquisition of other assets, better fit debt service
requriements
●● Healthcare bond issues place legal obligations on
Answer: the borrower intended to protect the lender against default by
the borrower.
●● In order to use the discounted cash flow method
