HCAD 375 Exam ACTUAL UPDATED
QUESTIONS AND CORRECT ANSWERS
Many facilities either employ or contract with _____ to perform accounting and/or financial
analysis - CORRECT ANSWERS✅✅Accountants
A 1 year accounting period is generally referred to as - CORRECT ANSWERS✅✅An
organization's fiscal year
What is the basic accounting equation? - CORRECT ANSWERS✅✅Assets = Liabilities +
Owners Equity
What type of accounting method is generally used in health care? - CORRECT
ANSWERS✅✅(Accounting in health care follows- GAAP)
Accrual accounting is the standard for heath care accounting
Why do many organizations hire financial specialists? - CORRECT ANSWERS✅✅-Due to
a bunch of special forms that need to be filled out for Medicare and Medicaid reimbursement,
facilities call financial specialists who deal exclusively with regulations & procedures
inherent in Medicare and Medicaid reimbursement
-Most facilities also have a fixed budget and require timely remuneration
Describe the role of a "bookkeeper" - CORRECT ANSWERS✅✅-Not formally trained in
accounting but handles entries such as
-Addressing accounts receivable and monitor resident billing
-Mailing monthly statements to residents and families
-Writing checks
,-Keeping track of disbursements
-Making sure office finances are being addressed in a timely and orderly fashion
The "income statement" may also be called - CORRECT ANSWERS✅✅Profit/Loss
statement
The ____ examines financial status at a point in time - CORRECT ANSWERS✅✅Balance
sheet
The ____ examines financial activity over a period of time - CORRECT
ANSWERS✅✅Income statement
What has led to increased HC costs? - CORRECT ANSWERS✅✅-Aging population
-Newly insured under ACA
-Uninsured
-Rx drugs
-More advanced medical technology
-Chronic disease
-Defensive medicine
What has led to decreased HC costs? - CORRECT ANSWERS✅✅-Employer incentives
-Increase (cost conscious)
, -Increase in IT to manage chronic care
-Prevent medical errors
-Generic drugs
-More outpatient/home services
-Improved management techniques
-R4P value-based purchasing
-Economics of scale in purchasing
-Evidence based medicine
Name and describe the 4 elements of financial management - CORRECT
ANSWERS✅✅Planning- Making sure that each area of the organization is following
established plans
Controlling- Making choices among available alternatives
Organizing- Deciding how to use organizational resources to most effectively carry out
established plans
Decision making- Identifying steps that must be taken to accomplish an organizations
objectives
Describe differences between Proprietary vs Not-For-Profit health care organizations -
CORRECT ANSWERS✅✅Proprietary:
-Pays all taxes
QUESTIONS AND CORRECT ANSWERS
Many facilities either employ or contract with _____ to perform accounting and/or financial
analysis - CORRECT ANSWERS✅✅Accountants
A 1 year accounting period is generally referred to as - CORRECT ANSWERS✅✅An
organization's fiscal year
What is the basic accounting equation? - CORRECT ANSWERS✅✅Assets = Liabilities +
Owners Equity
What type of accounting method is generally used in health care? - CORRECT
ANSWERS✅✅(Accounting in health care follows- GAAP)
Accrual accounting is the standard for heath care accounting
Why do many organizations hire financial specialists? - CORRECT ANSWERS✅✅-Due to
a bunch of special forms that need to be filled out for Medicare and Medicaid reimbursement,
facilities call financial specialists who deal exclusively with regulations & procedures
inherent in Medicare and Medicaid reimbursement
-Most facilities also have a fixed budget and require timely remuneration
Describe the role of a "bookkeeper" - CORRECT ANSWERS✅✅-Not formally trained in
accounting but handles entries such as
-Addressing accounts receivable and monitor resident billing
-Mailing monthly statements to residents and families
-Writing checks
,-Keeping track of disbursements
-Making sure office finances are being addressed in a timely and orderly fashion
The "income statement" may also be called - CORRECT ANSWERS✅✅Profit/Loss
statement
The ____ examines financial status at a point in time - CORRECT ANSWERS✅✅Balance
sheet
The ____ examines financial activity over a period of time - CORRECT
ANSWERS✅✅Income statement
What has led to increased HC costs? - CORRECT ANSWERS✅✅-Aging population
-Newly insured under ACA
-Uninsured
-Rx drugs
-More advanced medical technology
-Chronic disease
-Defensive medicine
What has led to decreased HC costs? - CORRECT ANSWERS✅✅-Employer incentives
-Increase (cost conscious)
, -Increase in IT to manage chronic care
-Prevent medical errors
-Generic drugs
-More outpatient/home services
-Improved management techniques
-R4P value-based purchasing
-Economics of scale in purchasing
-Evidence based medicine
Name and describe the 4 elements of financial management - CORRECT
ANSWERS✅✅Planning- Making sure that each area of the organization is following
established plans
Controlling- Making choices among available alternatives
Organizing- Deciding how to use organizational resources to most effectively carry out
established plans
Decision making- Identifying steps that must be taken to accomplish an organizations
objectives
Describe differences between Proprietary vs Not-For-Profit health care organizations -
CORRECT ANSWERS✅✅Proprietary:
-Pays all taxes
