Quiz About Services

1. Cost shifting is the practice of

Charging certain populations more for services

Charging more for costlier procedures

Shifting costs from some payers to offset losses from another

None of the above

2. Pricing products and services low in the long term by making fundamental changes to the products or services is known as ______ pricing.

Slash

Follower

Skim

Preemptive

3. Setting charges on the basis of consensus provokes

Competition from insurance companies

Cost shifting

Cost cutting

Providers to search for sources of revenue other than patient care

4. What two factors have led to lower charges in the healthcare industry?

Managed care; advances in information technology

Managed care; prospective payment systems

Prospective payment systems; advances in information technology

Prospective payment systems; decreased demand for services

5. Financial expediency is a method of setting charges on the basis of

The financial needs of the provider

How quickly a provider can be reimbursed for services

How quickly services can be performed

How quickly a patient recover

6. Departments that know the cost of their products use which method of setting charges?

DRG method

Surcharge method

RVU method

Hourly rate method

7. Most providers agree that the following method of reimbursement is the least favorable.

Charges minus a discount

Capitation

Cost

Charges

8. Using the surcharge method of setting charges, calculate the charge necessary to cover total costs for 250,000 admission kits given that at East Side Clinic total projected cost of kits and administration = $375,000 and total projected cost of admission kits = $250,000.

$1.00

$1.50

50 cents

$3.00

9. Charge master enrichment ensures that

Healthcare organizations are charging only for items third-party payers recognize as legitimate charges

Charges set for specific items result in maximum benefit

Healthcare organizations do not lose charges

None of the above

10. What factors are taken into consideration when using financial expediency as a method of setting charges?

Cost of providing services to charge-based patients

Losses to Medicare and Medicaid

Cost of bad debt and charity care

All of the above

11. Using the __________ method of setting charges, providers can set charges to break even or realize a profit.

Hourly rate

Surcharge

RVU

DRG

12. Charge capture assessment ensures that

Charges set for specific items result in maximum reimbursement

Healthcare organizations do not lose charges

None of the above

13. Providers set charges on the basis of _________ in competition-driven charging.

DRGs

What other providers are charging

What the market will bear

Medicare’s fee schedule

14. Using the hourly rate method of setting charges, calculate the charge per modality necessary to recover total costs given that at Stretch Sports Medicine Clinic total projected costs per year = $600,000, total projected hours of use per year = 15,000, and modality = 20 minutes.

$10

$25

$13.33

$12.50