FACHE BOG ACTUAL EXAM 2025 TEST BANK: 150+ CHALLENGING
MCQS WITH VERIFIED ANSWERS & EXPLANATIONS | GOVERNANCE,
FINANCE, ETHICS, RISK & QUALITY MANAGEMENT
1. According to the ACHE Code of Ethics, how should a healthcare executive address a
potential conflict of interest?
A. Develop a PR plan
B. Refrain from participating in decisions
C. Submit annual holdings list
D. Disclose the conflict to superiors
Answer: D
Explanation: The ACHE Code of Ethics stresses transparency. Disclosure to superiors ensures
accountability and integrity.
2. What is the core shift in management philosophy required for quality improvement?
A. Faulting employees ➝ Faulting processes
B. Employees ➝ Process outcomes
C. Inspection ➝ Variance
D. Outcomes ➝ Cost-savings
Answer: A
Explanation: Quality improvement moves focus from blaming individuals to fixing process
flaws for systemic betterment.
,3. Allowing double billing represents what kind of issue?
A. Ethical concern but not grounds for dismissal
B. Actual conflict of interest
C. Ethical only if profit is involved
D. Only a legal violation
Answer: B
Explanation: Even without personal gain, knowingly allowing unethical billing creates a
conflict and legal exposure.
4. What unit measures physician productivity?
A. CMS
B. CPU
C. IPO
D. RVU
Answer: D
Explanation: RVUs (Relative Value Units) are standardized metrics for tracking physician work
and service value.
5. Which payment method most incentivizes cost reduction?
A. Charge-based
B. Cost-based
C. Prospective payment
D. Per diem
Answer: C
Explanation: Prospective payments are fixed, encouraging providers to operate efficiently and
avoid unnecessary costs.
,6. What’s required of publicly owned healthcare organizations annually?
A. Submit employee rosters
B. File stakeholder surveys
C. Report earnings, positions, and retained earnings
D. Provide community health assessments
Answer: C
Explanation: Transparency in financial status ensures regulatory compliance and stakeholder
accountability.
7. What’s an example of a capital expenditure?
A. Disposable supplies
B. 6-month-use surgical tools
C. 20-year lifespan building
D. Resale land
Answer: C
Explanation: Capital expenditures are long-term investments. Buildings with extended use
qualify.
8. What is the first step in organization-wide change?
A. Implementation
B. Evaluation
C. Identifying issues
D. Planning
Answer: C
Explanation: Problem identification is critical for any structured change management process.
, 9. For strategic decision-making, board information must be:
A. Website available
B. Graphical
C. Outcome-focused
D. Generated via AI
Answer: C
Explanation: Data should link to measurable outcomes in service quality and financial
performance.
10. Who are typical internal board members in a health org?
A. PR staff
B. External auditors
C. CEO, CFO, Medical Director
D. HR team
Answer: C
Explanation: These roles ensure internal operational knowledge is included in governance.
11. Focus groups are more effective than surveys in:
A. Measuring exact satisfaction
B. Objectivity
C. Program improvement design
D. Sample size accuracy
Answer: C
Explanation: Focus groups yield qualitative insights essential for refining services.
MCQS WITH VERIFIED ANSWERS & EXPLANATIONS | GOVERNANCE,
FINANCE, ETHICS, RISK & QUALITY MANAGEMENT
1. According to the ACHE Code of Ethics, how should a healthcare executive address a
potential conflict of interest?
A. Develop a PR plan
B. Refrain from participating in decisions
C. Submit annual holdings list
D. Disclose the conflict to superiors
Answer: D
Explanation: The ACHE Code of Ethics stresses transparency. Disclosure to superiors ensures
accountability and integrity.
2. What is the core shift in management philosophy required for quality improvement?
A. Faulting employees ➝ Faulting processes
B. Employees ➝ Process outcomes
C. Inspection ➝ Variance
D. Outcomes ➝ Cost-savings
Answer: A
Explanation: Quality improvement moves focus from blaming individuals to fixing process
flaws for systemic betterment.
,3. Allowing double billing represents what kind of issue?
A. Ethical concern but not grounds for dismissal
B. Actual conflict of interest
C. Ethical only if profit is involved
D. Only a legal violation
Answer: B
Explanation: Even without personal gain, knowingly allowing unethical billing creates a
conflict and legal exposure.
4. What unit measures physician productivity?
A. CMS
B. CPU
C. IPO
D. RVU
Answer: D
Explanation: RVUs (Relative Value Units) are standardized metrics for tracking physician work
and service value.
5. Which payment method most incentivizes cost reduction?
A. Charge-based
B. Cost-based
C. Prospective payment
D. Per diem
Answer: C
Explanation: Prospective payments are fixed, encouraging providers to operate efficiently and
avoid unnecessary costs.
,6. What’s required of publicly owned healthcare organizations annually?
A. Submit employee rosters
B. File stakeholder surveys
C. Report earnings, positions, and retained earnings
D. Provide community health assessments
Answer: C
Explanation: Transparency in financial status ensures regulatory compliance and stakeholder
accountability.
7. What’s an example of a capital expenditure?
A. Disposable supplies
B. 6-month-use surgical tools
C. 20-year lifespan building
D. Resale land
Answer: C
Explanation: Capital expenditures are long-term investments. Buildings with extended use
qualify.
8. What is the first step in organization-wide change?
A. Implementation
B. Evaluation
C. Identifying issues
D. Planning
Answer: C
Explanation: Problem identification is critical for any structured change management process.
, 9. For strategic decision-making, board information must be:
A. Website available
B. Graphical
C. Outcome-focused
D. Generated via AI
Answer: C
Explanation: Data should link to measurable outcomes in service quality and financial
performance.
10. Who are typical internal board members in a health org?
A. PR staff
B. External auditors
C. CEO, CFO, Medical Director
D. HR team
Answer: C
Explanation: These roles ensure internal operational knowledge is included in governance.
11. Focus groups are more effective than surveys in:
A. Measuring exact satisfaction
B. Objectivity
C. Program improvement design
D. Sample size accuracy
Answer: C
Explanation: Focus groups yield qualitative insights essential for refining services.
