CNML TEST EXAM 2026 COMPLETE
QUESTIONS AND SOLUTIONS
◉ Prospective Payment System. Answer: Used by Medicare-
participating hospitals: pretreatment diagnosis billings based on
DRGs; rate decided ahead of time between insurance companies and
hospitals
◉ Exclusive Provider. Answer: Used by HMO's: insurance coverage
for contracted providers or institutions
◉ HMOs. Answer: Health maintenance organizations:
comprehensive healthcare to people who pay a fee for a fixed period
of time
◉ Capitation. Answer: Fixed rate paid to provider per member per
month for healthcare services; set fee paid by insurance company
per month for all the patient needs
◉ PPOs. Answer: Preferred provider organizations: special reduced
rate for services when customers use certain providers approved by
the insurance company; usually fee-for-service
,◉ IPAs. Answer: Individual provider arrangements: provide care in
their offices for prepaid plans; coalition of physicians who serve
HMO patients and third-party patients
◉ Fulltime FTE Hours. Answer: 2080 hours (1.0 @ 40 hours per
week)
◉ Capital Expenses. Answer: Long-term equipment or physical
purchases: usually over $500-$1000 that will last years and
depreciate over time and be used multiple times
◉ Zero-Based Budget. Answer: With each new budget (i.e. fiscal
year), it is determined which programs/areas get money; no
historical context is used; may rank packages and then only fund
top-ranked ones; can be time-consuming way to create a budget
◉ Variance Calculation & Reminders. Answer: Variance $ /Budgeted
$ X 100 = % difference; contract staff on separate line of budget;
many staff sick costs more than a few staff on LOA
◉ Cost of Nursing Services Calculation. Answer: Nurse Time X (Avg.
RN Hourly Rate + Benefits + Indirects) = Total Nursing Cost per DRG
◉ General Nurse Staffing Calculation. Answer: # of RNs needed X
days open / # days worked per RN
, ◉ FTE Definition & Calculation. Answer: Full-time equivalent = full-
time employee paid for 1 year
FTE = (Hours per shift X # of days worked) / 40 hours
◉ Fixed Costs. Answer: Stay the same no matter the census:
manager salaries, keeping phones on, rent, etc.
◉ Variable Costs. Answer: Change with census and how much
staffing is used
◉ Net Revenue Calculation. Answer: Gross Revenue - Deductions
from Revenue (DRGs and the Contractual allowances paid by
insurance companies)
◉ UAP. Answer: Unlicensed assistive personnel (CNA's)
◉ ADC. Answer: Average daily census (patients in a bed at midnight)
◉ Total Patient Days Calculation. Answer: ADC X Days open per year
(for SCH - ADC X 365)
QUESTIONS AND SOLUTIONS
◉ Prospective Payment System. Answer: Used by Medicare-
participating hospitals: pretreatment diagnosis billings based on
DRGs; rate decided ahead of time between insurance companies and
hospitals
◉ Exclusive Provider. Answer: Used by HMO's: insurance coverage
for contracted providers or institutions
◉ HMOs. Answer: Health maintenance organizations:
comprehensive healthcare to people who pay a fee for a fixed period
of time
◉ Capitation. Answer: Fixed rate paid to provider per member per
month for healthcare services; set fee paid by insurance company
per month for all the patient needs
◉ PPOs. Answer: Preferred provider organizations: special reduced
rate for services when customers use certain providers approved by
the insurance company; usually fee-for-service
,◉ IPAs. Answer: Individual provider arrangements: provide care in
their offices for prepaid plans; coalition of physicians who serve
HMO patients and third-party patients
◉ Fulltime FTE Hours. Answer: 2080 hours (1.0 @ 40 hours per
week)
◉ Capital Expenses. Answer: Long-term equipment or physical
purchases: usually over $500-$1000 that will last years and
depreciate over time and be used multiple times
◉ Zero-Based Budget. Answer: With each new budget (i.e. fiscal
year), it is determined which programs/areas get money; no
historical context is used; may rank packages and then only fund
top-ranked ones; can be time-consuming way to create a budget
◉ Variance Calculation & Reminders. Answer: Variance $ /Budgeted
$ X 100 = % difference; contract staff on separate line of budget;
many staff sick costs more than a few staff on LOA
◉ Cost of Nursing Services Calculation. Answer: Nurse Time X (Avg.
RN Hourly Rate + Benefits + Indirects) = Total Nursing Cost per DRG
◉ General Nurse Staffing Calculation. Answer: # of RNs needed X
days open / # days worked per RN
, ◉ FTE Definition & Calculation. Answer: Full-time equivalent = full-
time employee paid for 1 year
FTE = (Hours per shift X # of days worked) / 40 hours
◉ Fixed Costs. Answer: Stay the same no matter the census:
manager salaries, keeping phones on, rent, etc.
◉ Variable Costs. Answer: Change with census and how much
staffing is used
◉ Net Revenue Calculation. Answer: Gross Revenue - Deductions
from Revenue (DRGs and the Contractual allowances paid by
insurance companies)
◉ UAP. Answer: Unlicensed assistive personnel (CNA's)
◉ ADC. Answer: Average daily census (patients in a bed at midnight)
◉ Total Patient Days Calculation. Answer: ADC X Days open per year
(for SCH - ADC X 365)
