GK Flashcards
Financial Accounting is
Company’s general accounting, which includes profits, revenue, losses, etc. It is your taxes accounting.
Cost Accounting is
Accounting of a specific unit (a specific test, a specific product). It is used for internal purposes and it is part of the financial account.
Forecast budget
Budget items are increased or decreased based on previous year’s budget. Takes in consideration the revenue from previous year together with # of tests forecasted for the next year
The budget used for equipment purchase or expansion of the lab is
Capital budget
In a rolling quarter budget, the budget is prepared every
3 months (quarterly)
On flexible budget,
Itemizes items such as overhead (fixed cost) and variable expenses. It is usefull when the variable portion needs be adjusted, for instance if test volumes changes
CLIA ‘88 for US federal law mandates that the lab director is responsible for
1) Hriring qualified personnel
2) Record and report results promptly, accurately and proficienctly
3) Making sure that lab is compliant with applicable regulations
The bugdet used for the laboratory operations is
Operational budget
How often cash budget is prepared?
Monthly, so the cash flow can be anticipated.
What is not included on Conversion Costs?
A) Direct Labor
B) Overhead
C) Materials
C
Full Production Costs include: A) Direct labor B) Direct material C) Overhead D) All of the above
D
Prime Cost + Ready to Serve Costs =
Fully loaded costs
Fringe benefits can be up to 25% of the employee salary. Is that true or false?
True
7.65% unemployment compensation is also known as:
FICA (Social Security Tax)
Full production costs includes
Direct labor + direct material + overhead
Ready to serve cost is the operational cost to serve your client. It includes:
Overhead in general (operational + section) and other costs associated with the publication and delivery of your results.
Fully loaded cost =
Prime cost + Ready to serve cost
Direct labor+ direct material + overhead + collection, reporting, delivery of your product.
tests to break even =
Fixed cost / (test price - variable cost)
Charges to break even ($)
Fixed cost/test volume + (variable cost)
Minimum to break even =
Fixed cost / test price (unit) - variable cost (unit)
Or
Fixed cost / contribution margin %
In the demand oriented pricing, the prices are set based on what is believed that the customer is willing to pay.
True
The strategy used to set pricing to maximize profit taking advantage of a short term situation, is called
Skim pricing
Offesive pricing to undercut competitor and atract customers is know as A) Loss Leader Price B) Skim Price C) Penetration Price D) Mark-up
C
Loss of leader price is when
Profit of one product is reduced (lower price) so customers are attraced to also buy other products at a higher price
Three ILLEGAL prices strategies are:
A) Price discrimination, skim price and price fixing
B) Deceptive pricing, minimum pricing, price fixing
C) Price fixing, penetration price and discount pricing
B
On price fixing strategy, sellers can discuss their prices with their competitors
False
In Minimum pricing
The product can’t be priced below the cost for any extended period with the intention to destroy the competitors
The managed care insurances were introduced in the USA by the
Health Maintenance Organization Act (1973)
In the captation agreement,
The managed careorganization pays a fixed amount of money for its members to thehealth careprovider.
One of the determinations of the Tax Equity and Fiscal Responsibility Act (TEFRA) of 1982 is that
Reimbursements for Medicare Part A procedures (hospitals, hospice care, nursing or home care) is based on ICD-10 codes
What is the criteria to qualify for Medicare?
- Over 65 years old
- Have end-stage renal disease and met the waiting period;
- permanently disabled
Medicare Part B and C covers for
Part B: outpatient lab tests, physician services and other medical services. Coverage is NOT automatic and beneficiary must opt in.
Part C: is a Medicare Advantage Plan - an HMO type. It is from commercial insurance companies
Healthcare Common Procedure Coding System (HCPCS) adds:
Category II Codes: start with letters A-V and these are codes designated for special services/circumstances where a CPT code doesn’t exist
Category III Codes: codes used for emerging technologies, that don’t have a CPT Code yet
What is modifier 91?
Is used when a lab test needs to be repeated
When a laboratory refers a test to another laboratory, which modifier needs to be added to the service billed
Modifier 90
What is a modifier
These are 2 letter codes used to supplement information or adjust care descriptions to provide extra details concerning aprocedureor service provided by a physician, without modifying the service definition.
Sensitivity is the probability of identify a diseased person as diseased
True
The difference between accuracy and precision is
accuracy is the degree of veracity while precision is the degree of reproducibility
In a normal bell curve distribution
- 26% will fall in the 1SD of the mean
- 46% in the 2SD of the nean
- 73% in the 3SD of the mean
Student T test is used to determine how significant the difference between two groups are
True
Confidence interval can be determined by calculating
CI = mean +/- 2(SD)
