Health Service Finance TEST

1. (TCO 4) Discuss the differences between efficiency and effectiveness. 

2. (TCO 7) 1. Explain the difference between a joint venture and a merger

3. (TCO 1) Describe the Outpatient Code Editor. 

4. (TCO 1) How could a hospital legally avoid being covered by the Emergency Medical Treatment and Labor Act (EMTALA)? 

5. (TCO 3)  Use the following data to calculate the variances in problem.

Your hospital has been approached by a major HMO to perform all their MS-DRG 470 cases (major joint procedures). They have offered a flat price of $10,000 per case. You have reviewed your charges for MS-DRG 470 during the last year and found the following profile:

The HMO in the above example has indicated that their doctors use less expensive joint implants. If this less expensive implant is used, your medical supply charges would be reduced by $2,000. What is the estimated reduction in variable cost?     

6. (TCO 2) What are the major reasons for accrual accounting? 

7. (TCO 2) What are the double-entry accounting system and the duality concept? How are they related? 

8. (TCO 5) Define an annuity. 

9. (TCO 5) What avenues are available for for-profit healthcare providers to increase their equity position? 

10. (TCO 6) What is the purpose of working capital? 

11. (TCO 6) Define working capital. What is the difference between working capital and net working capital? 

12. (TCO 5) How should the interest rate and n periods of compounding be modified if compounding for less than one year?