[WASHINGTON STATE MEDICAL BILLING AND CODING EXAM] –
QUESTIONS AND ANSWERS | VERIFIED AND WELL DETAILED
ANSWERS | PLUS RATIONALES | GUARANTEED PASS | LATEST
EXAM UPDATE | EXAM PREP | STUDY GUIDE | PRACTICE TEST
1. A patient is seen in an outpatient clinic for evaluation of hypertension. The provider
documents moderate complexity decision-making. Which E/M component is most directly
impacted?
A. History
B. Medical Decision Making
C. Physical Examination
D. Time Spent
════════════════════
Correct Answer: B. Medical Decision Making
Rationale:
Medical decision making determines complexity based on diagnoses, data reviewed, and risk.
History and exam support documentation but do not define complexity level directly. Time is
only a factor under specific coding guidelines.
════════════════════
2. Which coding system is primarily used for reporting outpatient procedures and physician
services?
A. ICD-10-PCS
B. HCPCS Level II
C. CPT
D. DRG
════════════════════
Correct Answer: C. CPT
Rationale:
CPT codes are used for outpatient and physician services. ICD-10-PCS is for inpatient
procedures, HCPCS Level II covers supplies and services, and DRGs are for inpatient hospital
reimbursement grouping.
════════════════════
3. A claim is denied due to missing prior authorization. What is the best first step for the
billing specialist?
,A. Write off the balance
B. Resubmit claim without changes
C. Verify authorization requirements and obtain retro authorization if possible
D. Send patient to collections
════════════════════
Correct Answer: C. Verify authorization requirements and obtain retro authorization if
possible
Rationale:
The correct approach is to review payer rules and attempt correction. Writing off or
collections is premature, and resubmitting without correction will result in another denial.
════════════════════
4. Which section of the ICD-10-CM code set provides guidelines for sequencing diagnoses?
A. Tabular List
B. Alphabetic Index
C. Conventions
D. Appendix A
════════════════════
Correct Answer: C. Conventions
Rationale:
Conventions provide rules for sequencing, punctuation, and code assignment. The tabular list
and index assist in locating codes but do not define sequencing rules.
════════════════════
5. A patient presents with acute bronchitis due to influenza. How should this be coded?
A. Only acute bronchitis
B. Only influenza
C. Influenza as primary with acute bronchitis as secondary
D. Acute bronchitis as primary with influenza as secondary
════════════════════
Correct Answer: C. Influenza as primary with acute bronchitis as secondary
Rationale:
The underlying cause (influenza) is sequenced first followed by the manifestation (acute
bronchitis), following ICD-10-CM guidelines for combination conditions.
════════════════════
,6. What is the purpose of the National Correct Coding Initiative (NCCI)?
A. Assign diagnosis codes
B. Prevent improper payment of procedures that should not be reported together
C. Determine patient eligibility
D. Set hospital reimbursement rates
════════════════════
Correct Answer: B. Prevent improper payment of procedures that should not be reported
together
Rationale:
NCCI edits identify code combinations that should not be billed together to prevent improper
payments. It does not assign diagnoses or set reimbursement rates.
════════════════════
7. A provider documents “rule out pneumonia.” How is this coded in the outpatient setting?
A. Pneumonia confirmed
B. Signs and symptoms only
C. Suspected pneumonia
D. No code assigned
════════════════════
Correct Answer: B. Signs and symptoms only
Rationale:
In outpatient settings, uncertain diagnoses are not coded as confirmed; instead, symptoms
are coded until confirmed.
════════════════════
8. Which modifier indicates a service was reduced at the physician’s discretion?
A. -25
B. -52
C. -59
D. -76
════════════════════
Correct Answer: B. -52
Rationale:
Modifier -52 indicates reduced services. -25 is significant, separately identifiable E/M, -59
indicates distinct procedural service, and -76 indicates repeat procedure.
════════════════════
, 9. What does a DRG primarily determine?
A. Physician payment
B. Outpatient reimbursement
C. Inpatient hospital reimbursement grouping
D. Pharmacy billing
════════════════════
Correct Answer: C. Inpatient hospital reimbursement grouping
Rationale:
DRGs classify inpatient stays into payment categories based on diagnosis and procedures.
════════════════════
10. Which of the following is considered PHI under HIPAA?
A. Hospital name
B. Patient diagnosis linked to identity
C. General disease statistics
D. Insurance company name
════════════════════
Correct Answer: B. Patient diagnosis linked to identity
Rationale:
PHI includes any identifiable health information tied to a patient. De-identified statistics are
not PHI.
════════════════════
11. A patient receives two unrelated procedures during the same encounter. What should be
used to indicate distinct services?
A. -25
B. -59
C. -91
D. -24
════════════════════
Correct Answer: B. -59
Rationale:
Modifier -59 identifies distinct procedural services that are not normally reported together.
════════════════════
12. What is the primary purpose of medical necessity in billing?
A. Increase reimbursement
QUESTIONS AND ANSWERS | VERIFIED AND WELL DETAILED
ANSWERS | PLUS RATIONALES | GUARANTEED PASS | LATEST
EXAM UPDATE | EXAM PREP | STUDY GUIDE | PRACTICE TEST
1. A patient is seen in an outpatient clinic for evaluation of hypertension. The provider
documents moderate complexity decision-making. Which E/M component is most directly
impacted?
A. History
B. Medical Decision Making
C. Physical Examination
D. Time Spent
════════════════════
Correct Answer: B. Medical Decision Making
Rationale:
Medical decision making determines complexity based on diagnoses, data reviewed, and risk.
History and exam support documentation but do not define complexity level directly. Time is
only a factor under specific coding guidelines.
════════════════════
2. Which coding system is primarily used for reporting outpatient procedures and physician
services?
A. ICD-10-PCS
B. HCPCS Level II
C. CPT
D. DRG
════════════════════
Correct Answer: C. CPT
Rationale:
CPT codes are used for outpatient and physician services. ICD-10-PCS is for inpatient
procedures, HCPCS Level II covers supplies and services, and DRGs are for inpatient hospital
reimbursement grouping.
════════════════════
3. A claim is denied due to missing prior authorization. What is the best first step for the
billing specialist?
,A. Write off the balance
B. Resubmit claim without changes
C. Verify authorization requirements and obtain retro authorization if possible
D. Send patient to collections
════════════════════
Correct Answer: C. Verify authorization requirements and obtain retro authorization if
possible
Rationale:
The correct approach is to review payer rules and attempt correction. Writing off or
collections is premature, and resubmitting without correction will result in another denial.
════════════════════
4. Which section of the ICD-10-CM code set provides guidelines for sequencing diagnoses?
A. Tabular List
B. Alphabetic Index
C. Conventions
D. Appendix A
════════════════════
Correct Answer: C. Conventions
Rationale:
Conventions provide rules for sequencing, punctuation, and code assignment. The tabular list
and index assist in locating codes but do not define sequencing rules.
════════════════════
5. A patient presents with acute bronchitis due to influenza. How should this be coded?
A. Only acute bronchitis
B. Only influenza
C. Influenza as primary with acute bronchitis as secondary
D. Acute bronchitis as primary with influenza as secondary
════════════════════
Correct Answer: C. Influenza as primary with acute bronchitis as secondary
Rationale:
The underlying cause (influenza) is sequenced first followed by the manifestation (acute
bronchitis), following ICD-10-CM guidelines for combination conditions.
════════════════════
,6. What is the purpose of the National Correct Coding Initiative (NCCI)?
A. Assign diagnosis codes
B. Prevent improper payment of procedures that should not be reported together
C. Determine patient eligibility
D. Set hospital reimbursement rates
════════════════════
Correct Answer: B. Prevent improper payment of procedures that should not be reported
together
Rationale:
NCCI edits identify code combinations that should not be billed together to prevent improper
payments. It does not assign diagnoses or set reimbursement rates.
════════════════════
7. A provider documents “rule out pneumonia.” How is this coded in the outpatient setting?
A. Pneumonia confirmed
B. Signs and symptoms only
C. Suspected pneumonia
D. No code assigned
════════════════════
Correct Answer: B. Signs and symptoms only
Rationale:
In outpatient settings, uncertain diagnoses are not coded as confirmed; instead, symptoms
are coded until confirmed.
════════════════════
8. Which modifier indicates a service was reduced at the physician’s discretion?
A. -25
B. -52
C. -59
D. -76
════════════════════
Correct Answer: B. -52
Rationale:
Modifier -52 indicates reduced services. -25 is significant, separately identifiable E/M, -59
indicates distinct procedural service, and -76 indicates repeat procedure.
════════════════════
, 9. What does a DRG primarily determine?
A. Physician payment
B. Outpatient reimbursement
C. Inpatient hospital reimbursement grouping
D. Pharmacy billing
════════════════════
Correct Answer: C. Inpatient hospital reimbursement grouping
Rationale:
DRGs classify inpatient stays into payment categories based on diagnosis and procedures.
════════════════════
10. Which of the following is considered PHI under HIPAA?
A. Hospital name
B. Patient diagnosis linked to identity
C. General disease statistics
D. Insurance company name
════════════════════
Correct Answer: B. Patient diagnosis linked to identity
Rationale:
PHI includes any identifiable health information tied to a patient. De-identified statistics are
not PHI.
════════════════════
11. A patient receives two unrelated procedures during the same encounter. What should be
used to indicate distinct services?
A. -25
B. -59
C. -91
D. -24
════════════════════
Correct Answer: B. -59
Rationale:
Modifier -59 identifies distinct procedural services that are not normally reported together.
════════════════════
12. What is the primary purpose of medical necessity in billing?
A. Increase reimbursement
