HCAD 375 Final UPDATED Exam
Questions and CORRECT Answers
3 managerial viewpoints and how that influences $ management - CORRECT ANSWER-
Financial: work with finance on a daily basis, responsible for the reporting function
Process: work with the system of the organization, responsible for data accumulation
Clinical: usually work with and interact directly with patients, responsible for service
delivery also responsible for clinical outcomes
Proprietary vs not-for-profit - CORRECT ANSWER- -pay all taxes
-corporations, partnerships, or individuals
-do not pay income, property, or sales tax (do pay payroll)
-voluntary or government
stand alone or part of a larger organization
affect structure and organizational goals
Managerial vs. Financial accounting - CORRECT ANSWER- Financial:
-generally for outside, or third-party use
-emphasizes external reporting
-must use GAAP
-retrospective
Managerial:
-generally for inside, or internal use
-used by managers
-not bound by GAAP
-prospective as well as retrospective
Journal transactions and ledger - CORRECT ANSWER-
,Assets, Liabilities, Net Worth -what, examples, how fit together - CORRECT ANSWER-
Assets: economic resources that have expected future benefits to the business. Ex: cash,
accounts receivable, notes receivable, inventory, land
Liabilities: "outsider claims"/Economic obligations/debts/payable to outsiders. Ex: accounts
payable, payroll taxes due, notes payable, mortgage payable
Net Worth: "equity", insiders claims held by the owners of the business For profit sole-
"Owners equity" For profit corp.- "Capital Stock" Not for profit-"Fund Balance" or "Net
Assets"
Cash vs accrual - CORRECT ANSWER- Cash: recording assets when you collect cash or
spend cash
Accrual: record revenues when they are earned and when the resources are used
Payer mix - CORRECT ANSWER- proportion of revenues from different payers. Balance in
payers is key.
Medicare PPS: RVUs, DRGs, Episodes of Care - CORRECT ANSWER-
RUGs - CORRECT ANSWER- -66 resource utilization groups
Settings effect payment:
-nursing home pays per diem/day
-hospital pays per case
-home health is based on a 60 day period of care
MDS & OASIS - CORRECT ANSWER- 153 case mix groups called Home Health Resource
Groups. Outcome and assessment information set level of assistance based on a set number of
days of observation
Contractual allowance - CORRECT ANSWER- Contractual allowance =full established rate -
agreed upon contractual rate
may differ from plan to plan
Be able to calculate
, A/R Management - CORRECT ANSWER- -pt. revenues vs non patient revenues
-custom pay to categorize patient payer type
-need a clear collections policy and accurate documentation of efforts
-should meet with administrator monthly
Aging Report & uncollectable likelihood - CORRECT ANSWER- -review report monthly
with admin
-ask detailed questions/offer incentives
implementation of collections policy: calls, letters, collections agency, small claims court,
termination of care
Likely Uncollectable
5% 1-30 days
50% 91-120 days
"Typical" Wisconsin Benchmarks for Day O/S in A/R by payer - CORRECT ANSWER-
Trade Credit/when take discount - CORRECT ANSWER- typically no interest if paid when
due according to the terms
2/10 net 30
A/P management strategies - CORRECT ANSWER- -delay payment until due date (or
discount rate)
-stretch accounts payable
-bank in a distant city for "float" time
-keep a daily cash report
-reduce payroll strain on cash
Exempt vs Non-Exempt - CORRECT ANSWER- Exempt- (salary pay) aren't entitled to
overtime pay
Non Exempt- are entitled to overtime pay
Questions and CORRECT Answers
3 managerial viewpoints and how that influences $ management - CORRECT ANSWER-
Financial: work with finance on a daily basis, responsible for the reporting function
Process: work with the system of the organization, responsible for data accumulation
Clinical: usually work with and interact directly with patients, responsible for service
delivery also responsible for clinical outcomes
Proprietary vs not-for-profit - CORRECT ANSWER- -pay all taxes
-corporations, partnerships, or individuals
-do not pay income, property, or sales tax (do pay payroll)
-voluntary or government
stand alone or part of a larger organization
affect structure and organizational goals
Managerial vs. Financial accounting - CORRECT ANSWER- Financial:
-generally for outside, or third-party use
-emphasizes external reporting
-must use GAAP
-retrospective
Managerial:
-generally for inside, or internal use
-used by managers
-not bound by GAAP
-prospective as well as retrospective
Journal transactions and ledger - CORRECT ANSWER-
,Assets, Liabilities, Net Worth -what, examples, how fit together - CORRECT ANSWER-
Assets: economic resources that have expected future benefits to the business. Ex: cash,
accounts receivable, notes receivable, inventory, land
Liabilities: "outsider claims"/Economic obligations/debts/payable to outsiders. Ex: accounts
payable, payroll taxes due, notes payable, mortgage payable
Net Worth: "equity", insiders claims held by the owners of the business For profit sole-
"Owners equity" For profit corp.- "Capital Stock" Not for profit-"Fund Balance" or "Net
Assets"
Cash vs accrual - CORRECT ANSWER- Cash: recording assets when you collect cash or
spend cash
Accrual: record revenues when they are earned and when the resources are used
Payer mix - CORRECT ANSWER- proportion of revenues from different payers. Balance in
payers is key.
Medicare PPS: RVUs, DRGs, Episodes of Care - CORRECT ANSWER-
RUGs - CORRECT ANSWER- -66 resource utilization groups
Settings effect payment:
-nursing home pays per diem/day
-hospital pays per case
-home health is based on a 60 day period of care
MDS & OASIS - CORRECT ANSWER- 153 case mix groups called Home Health Resource
Groups. Outcome and assessment information set level of assistance based on a set number of
days of observation
Contractual allowance - CORRECT ANSWER- Contractual allowance =full established rate -
agreed upon contractual rate
may differ from plan to plan
Be able to calculate
, A/R Management - CORRECT ANSWER- -pt. revenues vs non patient revenues
-custom pay to categorize patient payer type
-need a clear collections policy and accurate documentation of efforts
-should meet with administrator monthly
Aging Report & uncollectable likelihood - CORRECT ANSWER- -review report monthly
with admin
-ask detailed questions/offer incentives
implementation of collections policy: calls, letters, collections agency, small claims court,
termination of care
Likely Uncollectable
5% 1-30 days
50% 91-120 days
"Typical" Wisconsin Benchmarks for Day O/S in A/R by payer - CORRECT ANSWER-
Trade Credit/when take discount - CORRECT ANSWER- typically no interest if paid when
due according to the terms
2/10 net 30
A/P management strategies - CORRECT ANSWER- -delay payment until due date (or
discount rate)
-stretch accounts payable
-bank in a distant city for "float" time
-keep a daily cash report
-reduce payroll strain on cash
Exempt vs Non-Exempt - CORRECT ANSWER- Exempt- (salary pay) aren't entitled to
overtime pay
Non Exempt- are entitled to overtime pay
