Financial Management & Budgeting Flashcards
7 cards from real CMC practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Financial Management & Budgeting flashcards as text
A cardiac catheterization lab is evaluating whether to purchase a new imaging system. Which financial metric best measures the time required to recover the initial investment from net cash flows?
Answer: Payback period
The payback period measures how long it takes for cumulative net cash inflows to equal the initial capital outlay.
A cardiac unit's supply budget shows a 12% unfavorable variance at mid-year. The FIRST step the manager should take is to:
Answer: Identify the specific supply categories driving the variance
Root-cause analysis of the variance by supply category is required before any corrective action can be targeted effectively.
Which reimbursement model pays a fixed amount per cardiac patient discharge regardless of length of stay or resources consumed?
Answer: Diagnosis-related group (DRG)
DRG-based payment bundles reimbursement into a single prospective amount determined by the patient's discharge diagnosis and procedure.
A cardiac program wishes to add a structural heart disease service line. Which document projects anticipated revenues, expenses, and volumes over a multi-year horizon for the new program?
Answer: Pro forma financial statement
A pro forma financial statement projects future financial performance under assumed conditions for a proposed program or venture.
When negotiating a managed care contract for cardiac services, which metric directly reflects the hospital's cost efficiency and is most critical to review before setting contracted rates?
Answer: Cost-to-charge ratio
The cost-to-charge ratio translates billed charges into actual costs, revealing whether contracted rates will cover expenses.
A cardiac ICU manager notes that RN overtime costs have increased 20% this quarter. This expense would MOST likely appear in which budget category?
Answer: Salary and wages budget
Overtime pay is a component of the salary and wages (labor) budget, which tracks all personnel-related costs.
Under value-based purchasing (VBP) for cardiac care, hospitals can earn or lose Medicare reimbursement based on performance in which domains?
Answer: Clinical outcomes, patient experience, efficiency, and safety
CMS VBP adjusts payments based on a composite score across clinical outcomes, patient experience (HCAHPS), care efficiency, and safety domains.