ADVANCED CODING CHAPTER 1 AND 2 EXAM QUESTIONS WITH CORRECT ANSWERS
LATEST UPDATE 2026/2027
Coding - Answers the process of translating written or dictated medical record into a series of
numeric and alphanumeric codes.
code sets - Answers serve as a common language to ease data collection to, to evaluate the
quality of care, and to determine costs and reimbursement.
Two primary types of insurance - Answers private insurance plans and government insurance
plans.
Medicare - Answers the most significant government insurer, its a federal health insurance
program
Medicare - Answers provides coverage for people 65 and over, disable, blind, people with
permanent kidney failure and end stage renal disease.
Center for Medicare and Medicaid Services (CMS) - Answers regulations determine the coding
requirements for Medicare and non-Medicare payers alike.
Medicare Part A - Answers helps cover inpatient hospital care, skilled nursing facilities, hospice
care and home healthcare.
Medicare Part B - Answers helps cover medically necessary physicians services, outpatient care,
and other medical services.
Medicare Part B - Answers is optional and requires a premium, yearly deductible and co-
insurance to be paid.
Medicare Part C - Answers managed by private insurers, combines Part A and B sometimes Part
D.
Medicare Part D - Answers covers the prescription drug portion.
Medicaid - Answers health insurance assistance program for low income people sponsored by
federal and state governments.
(RBRVS) resource-based relative value scale - Answers Medicare payments for physician
services
the physician work component accounts for just over half (52%) of a procedure's/ services total
value. - Answers Physician work is measure by the time it takes to perform the services, the
technical skill and physical effort, the required mental effort and judgment, and the stress due to
the potential risk to patients.
Practice expense accounts for 44% of the total relative value for each service. - Answers
, Practice expense relative values are resource-based and differ by site of service.
The resource-based professional liability insurance (PLI) components accounts for 4% of the
total relative value for each service. - Answers
Physician fee schedule (PFS) - Answers annually published by the CMS.
Medical necessity - Answers whether a procedure or service is considered appropriate in a given
circumstance.
CMS policies regarding medical necessity based on regulations found in the Social Security Act.
- Answers When a physician provides services to a Medicare Beneficiary, he or she should bill
only those services that meet the Medicare standard of "reasonable and necessary" for the
diagnosis and treatment of a patient.
National Coverage Determination (NCD) - Answers explain when Medicare will pay for items or
services.
Medicare Administrative Contractor (MAC) - Answers is responsible for interpreting national
policies into regional policies, called Local Coverage Determination (LCD).
Local Coverage Determination (LCD) - Answers explain when a given service is indicated or
necessary, give guidance on coverage limitations, describe the specific CPT codes to which
policy applies, and list ICD-10-CM codes that support medical necessity for given service or
procedure.
Local Coverage Determination (LCD) - Answers have jurisdiction only within their regional area.
Advance Beneficiary Notice (ABN) - Answers standardized form that explains to the patient why
Medicare may deny the particular service or procedure.
Advance Beneficiary Notice (ABN) - Answers protects the provider's financial interest, CMS
requires before a provider can bill the patient for payment if Medicare denies coverage for the
stated service or procedure.
The amount on an ABN should be within how much of the cost to the patient? - Answers $100
or 25% of the cost
The health Insurance portability and Accountability Act of 1996 (HIPAA) - Answers provides
federal protections for personal health information when held by covered entities.
Protected health information (PHI) - Answers should be shared to satisfy a particular purpose, if
information is not required to satisfy a particular purpose it must be withheld.
An entity that processes nonstandard health information they receive from another entity into a
standard format is considered what? - Answers Clearinghouse
LATEST UPDATE 2026/2027
Coding - Answers the process of translating written or dictated medical record into a series of
numeric and alphanumeric codes.
code sets - Answers serve as a common language to ease data collection to, to evaluate the
quality of care, and to determine costs and reimbursement.
Two primary types of insurance - Answers private insurance plans and government insurance
plans.
Medicare - Answers the most significant government insurer, its a federal health insurance
program
Medicare - Answers provides coverage for people 65 and over, disable, blind, people with
permanent kidney failure and end stage renal disease.
Center for Medicare and Medicaid Services (CMS) - Answers regulations determine the coding
requirements for Medicare and non-Medicare payers alike.
Medicare Part A - Answers helps cover inpatient hospital care, skilled nursing facilities, hospice
care and home healthcare.
Medicare Part B - Answers helps cover medically necessary physicians services, outpatient care,
and other medical services.
Medicare Part B - Answers is optional and requires a premium, yearly deductible and co-
insurance to be paid.
Medicare Part C - Answers managed by private insurers, combines Part A and B sometimes Part
D.
Medicare Part D - Answers covers the prescription drug portion.
Medicaid - Answers health insurance assistance program for low income people sponsored by
federal and state governments.
(RBRVS) resource-based relative value scale - Answers Medicare payments for physician
services
the physician work component accounts for just over half (52%) of a procedure's/ services total
value. - Answers Physician work is measure by the time it takes to perform the services, the
technical skill and physical effort, the required mental effort and judgment, and the stress due to
the potential risk to patients.
Practice expense accounts for 44% of the total relative value for each service. - Answers
, Practice expense relative values are resource-based and differ by site of service.
The resource-based professional liability insurance (PLI) components accounts for 4% of the
total relative value for each service. - Answers
Physician fee schedule (PFS) - Answers annually published by the CMS.
Medical necessity - Answers whether a procedure or service is considered appropriate in a given
circumstance.
CMS policies regarding medical necessity based on regulations found in the Social Security Act.
- Answers When a physician provides services to a Medicare Beneficiary, he or she should bill
only those services that meet the Medicare standard of "reasonable and necessary" for the
diagnosis and treatment of a patient.
National Coverage Determination (NCD) - Answers explain when Medicare will pay for items or
services.
Medicare Administrative Contractor (MAC) - Answers is responsible for interpreting national
policies into regional policies, called Local Coverage Determination (LCD).
Local Coverage Determination (LCD) - Answers explain when a given service is indicated or
necessary, give guidance on coverage limitations, describe the specific CPT codes to which
policy applies, and list ICD-10-CM codes that support medical necessity for given service or
procedure.
Local Coverage Determination (LCD) - Answers have jurisdiction only within their regional area.
Advance Beneficiary Notice (ABN) - Answers standardized form that explains to the patient why
Medicare may deny the particular service or procedure.
Advance Beneficiary Notice (ABN) - Answers protects the provider's financial interest, CMS
requires before a provider can bill the patient for payment if Medicare denies coverage for the
stated service or procedure.
The amount on an ABN should be within how much of the cost to the patient? - Answers $100
or 25% of the cost
The health Insurance portability and Accountability Act of 1996 (HIPAA) - Answers provides
federal protections for personal health information when held by covered entities.
Protected health information (PHI) - Answers should be shared to satisfy a particular purpose, if
information is not required to satisfy a particular purpose it must be withheld.
An entity that processes nonstandard health information they receive from another entity into a
standard format is considered what? - Answers Clearinghouse
