Healthcare Management Flashcards

A practice's operating budget shows a variance between projected and actual expenses. Which type of variance is FAVORABLE?

Answer: Actual revenue exceeds projected revenue

A favorable revenue variance occurs when actual revenue exceeds projections, improving the practice's financial position.

Which concept describes the legal principle that an employer can be held liable for an employee's negligent acts committed within the scope of employment?

Answer: Respondeat superior

Respondeat superior ('let the master answer') holds employers liable for employees' negligent acts performed within the scope of their duties.

A medical practice implementing a value-based care contract should focus MOST on improving:

Answer: Clinical outcomes and cost efficiency metrics

Value-based contracts reward quality outcomes and efficient care delivery rather than volume of services.

Which document outlines the rules, expectations, and consequences for employee conduct in a medical practice?

Answer: The employee handbook / HR policy manual

The employee handbook establishes conduct standards, disciplinary procedures, and workplace policies that govern employment.

A CMM exam candidate should know that ICD-10-CM codes are used primarily for:

Answer: Documenting diagnoses and health conditions for billing

ICD-10-CM (International Classification of Diseases, Clinical Modification) codes classify diagnoses and health conditions to support medical billing and epidemiology.

A practice manager is conducting performance appraisals. The tendency to rate all employees similarly regardless of actual performance is known as:

Answer: Central tendency error

Central tendency error occurs when raters avoid extremes and cluster ratings near the middle, failing to differentiate high and low performers.

A medical group's strategic plan includes a goal to expand into a new service line. The FIRST step in financial feasibility analysis should be to:

Answer: Project start-up costs, anticipated revenue, and break-even timeline

Financial feasibility begins with projecting costs, revenue potential, and break-even point to determine whether the expansion is viable.