Questions 1-40

Question 1

The interpretation of the healthcare organization’s role with respect to healthcare values would require:

1. Establishing corporate goals and major institutional policies.
2. Ensuring that the community served by the facility is well informed about the organization’s goals and performance.
3. Developing a mission statement indicating the organization’s fundamental purpose or reason for existence, in order to guide organizational behavior.
4. Creating a corporate vision of the organization’s governing authority.

Answer 1

Developing a mission statement indicating the organization’s fundamental purpose or reason for existence, in order to guide organizational behavior.

Question 2

Which one of the following statements is in accordance with the principle of delegation?

1. The executive who subscribes to the principle of delegation knows what he/she wants to accomplish and exercises control over the work schedule of subordinates.
2. An executive explains how he/she wants things done and points out how the subordinate’s contribution fits into the overall plan.
3. A successful executive gives instructions, telling subordinates exactly how and in what sequence things should be done.
4. In applying the principle of delegation, an executive makes relatively few decisions personally and frames orders in broad general terms.

Answer 2

In applying the principle of delegation, an executive makes relatively few decisions personally and frames orders in broad general terms.

Question 3

Before submission of the annual business plan to the governing authority, the plan should be developed by:
1.
Recommendations from the finance committee, on the basis of its estimate of income for the budget year.
2.
The heads of the profit centers, considering each center’s anticipated revenues and expenses, with the CEO collating.
3.
Key executives, after receiving recommendations from the heads of operating divisions.
4.
The heads of the operating divisions, with the CEO collating.

Answer 3

Key executives, after receiving recommendations from the heads of operating divisions.

Question 4

Most products and services enter a period of decline. Unless compelling reasons prevail, continuing a declining product or service is costly because:
1.
Increased turnover of personnel will occur.
2.
Continuation will set an undesirable precedent concerned with maintaining the status quo.
3.
The program will consume a disproportionate amount of management time and delay the search for a replacement.
4.
The organization will be perceived as being insensitive to the marketplace.

Answer 4

The program will consume a disproportionate amount of management time and delay the search for a replacement.

Question 5

Once a marketing research problem has been identified, the researcher’s next step is to:
1.
Conduct a literature search.
2.
Conduct focus groups and collect data.
3.
Specify information needs.
4.
Design a data-collection instrument.

Answer 5

3. Specify information needs.

Question 6

A key concept for marketing healthcare is to:
1.
Maximize the customer’s participation in the selling process.
2.
Advertise and promote existing services
3.
Adapt services to the customer’s needs.
4.
Emphasize specialization.

Answer 6

3.

Adapt services to the customer’s needs.

Question 7

Performance rating scales—the oldest and most widely used performance appraisal procedures—are of two general types: the continuous scale and the:
1.
Equitable scale.
2.
Discrete scale.
3.
Field rating.
4.
Behaviorally anchored rating

Answer 7

2.

Discrete scale.

Question 8

A successful healthcare organization usually has a unique and well-articulated company philosophy that presents a clear picture of the organization’s objectives, norms and values. Employee motivation to support this philosophy would be greatest when the company:
1.
Maintains a program that provides employees with a wide variety of social, cultural and recreational activities.
2.
Emphasizes financial rewards, including strong employee benefits.
3.
Provides a training program that is well communicated, understood by employees and enforced by executive management.
4.
Continues a major effort to articulate employee rights in such areas as grievances, affirmative action, and human rights issues.

Answer 8

Provides a training program that is well communicated, understood by employees and enforced by executive management.

Question 9

One of the techniques most frequently used in industry to aid management in interpreting a firm’s balance sheet is computation of the “acid-test ratio,” which is the ratio of:
1.
Current assets to current liabilities.
2.
Total assets to total liabilities.
3.
Cash to short-term debt.
4.
Cash, marketable securities and accounts receivable to current liabilities.

Answer 9

4.

Cash, marketable securities and accounts receivable to current liabilities.

Question 10

The primary reason for the decision to move from a freestanding voluntary
facility to an investor-owned healthcare organization is:
1.
Economy of scale.
2.
Access to the equity market.
3.
Access to patients.
4.
Improved visibility in the community.

Answer 10

2.

Access to the equity market.

Question 11

The purchasing/receiving process is often the weak link in a healthcare organization’s internal control of its inventory. Which one of the following is standard procedure in preventing problems in this area?

1. The organization should utilize a decentralized process for the control receiving.
2. Consolidation of receiving and storeroom functions will decrease the possibility of collusion.
3. Review of the process by the internal auditor should be done on a routine basis.
4. The principle of dual receiving accountability as a prerequisite for invoice payment should be enforced.

Answer 11

4. The principle of dual receiving accountability as a prerequisite for invoice payment should be enforced.

Question 12

Following the completion of a strategic plan and of program development activities, the healthcare facility may find it necessary to alter its physical capacity, to correct code violations, and to improve functional configuration. To achieve these objectives, the healthcare facility should:
1.
Identify accreditation requirements.
2.
Identify growth plans for patient, ancillary and support departments.
3.
Prepare a master facility plan.
4.
Prepare a physical facilities assessment.

Answer 12

3.

Prepare a master facility plan.

Question 13

The primary purpose of a planning task force for a management information system (MIS) is to:
1.
Make recommendations to the governing authority.
2.
Gather information on data needs in order to effectively evaluate vendors.
3.
Reduce the necessity for user feedback.
4.
Implement the MIS system of the facility.

Answer 13

2. Gather information on data needs in order to effectively evaluate vendors.

Question 14

Compatibility between data-processing units is necessary except when:
1.
The costs of individual systems are less than the cost of an integrated system.
2.
Technological advances are so rapid that obsolescence occurs within a few years.
3.
Constraints on available space restrict the size of the units that can be installed.
4.
The information involved is used for a discrete freestanding activity.

Answer 14

4.

The information involved is used for a discrete freestanding activity.

Question 15

Accident rates among personnel continue to rise and are distributed among all departments. What would be your best initial action in finding a comprehensive solution to this problem?
1.
Form a safety committee of key personnel to review reports of all accidents and make recommendations for corrections.
2.
Require each department head to analyze his/her department’s accidents in order to determine the causes and find methods of corrections.
3.
Institute a safety education program by departments.
4.
Recommend that the personnel committee formulate an effective accident-prevention program.

Answer 15

1.

Form a safety committee of key personnel to review reports of all accidents and make recommendations for corrections.

Question 16

If a physician abuses a patient in the healthcare organization, initial corrective action should be taken by the:
1.
Chief of staff.
2.
Chief of service (department chairman).
3.
Nursing unit supervisor.
4.
Chief executive officer.

Answer 16

2.

Chief of service (department chairman).

Question 17

The most useful way for a healthcare organization to deal with outside regulatory and credentialing bodies is to:
1.
Identify opportunities to influence political outcomes.
2.
Regularly maintain both formal and informal relationships with these agencies.
3.
Deal with these agencies only in written form so as to have a clear paper trail for subsequent review and analysis.
4.
Provide only the minimum amount of information required to comply with the regulations of the agency.

Answer 17

2.

Regularly maintain both formal and informal relationships with these agencies.

Question 18

The cultural climate of an organization affects its recruiting procedure because:
1.
It reduces employee turnover and absenteeism.
2.
Organizations seek applicants whose attitudes, values and goals are consistent with those of the organization.
3.
Applicants who cannot support a given culture will be unwilling to work for that organization.
4.
Applicants look only to organizations that portray a positive cultural climate.

Answer 18

2.

Organizations seek applicants whose attitudes, values and goals are consistent with those of the organization.

Question 19

Which of the following bodies has the final accountability for the formulation of policies and procedures concerning professional responsibilities within the healthcare organization?

1. Chief executive and senior management.
2. Medical executive committee.
3. Governing authority.
4. Quality assurance committee.

Answer 19

3. Governing authority.

Question 20

The volume that would be realized if each prospective consumer were to purchase a specified amount of a particular service during a defined future time frame is called:
1.
A sales forecast.
2.
A market forecast.
3.
Operational capacity.
4.
Market potential.

Answer 20

4. Market Potential

Question 21

As an internal control method, a budget is most commonly used to:
1.
Allow managers to control expenditures in the current year and to justify increases in future budgets.
2.
Provide feedback concerning operational expenditures to the governing authority and to allow management to satisfy the governing authority’s requirements of accountability.
3.
Serve as a numerical specification of plans and to function as a standard of control against which results can be compared.
4.
Allow management to monitor operational expenditures and to justify future requests for decreased or increased expenditures to rate-setting agencies.

Answer 21

Serve as a numerical specification of plans and to function as a standard of control against which results can be compared.

Question 22

Which of the following is the proper term for the healthcare facility development plan?
1.
Land use plan.
2.
Functional plan.
3.
Master site plan.
4.
Strategic plan.

Answer 22

3. Master Site plan

Question 23

The management accountability of a senior executive can best be
determined by a formal evaluation of performance if the:
1.
Governing authority receives copies of the evaluation.
2.
Performance objectives are discussed and agreed upon at the time of employment.
3.
Review is conducted annually.
4.
Review is conducted by a committee.

Answer 23

2.

Performance objectives are discussed and agreed upon at the time of employment.

Question 24

Materials management can best be defined as a system of effective:
1.
Purchasing of materials at the lowest possible cost.
2.
Distribution of materials on a scheduled basis.
3.
Allocation of materials.
4.
Control of inventories.

Answer 24

3.

Allocation of materials.

Question 25

The purpose of debt-service coverage is to:
1.
Determine the payout period.
2.
Determine the rating of the bonds.
3.
Protect the investor.
4.
Establish the rate structure for patient services.

Answer 25

3. Protect the Investor

Question 26

When facility maintenance is deferred, which of the following
outcomes is predictable?
1. Higher costs.
2. Lower costs.
3. Deferred risk.
4. Higher liability exposure.

Answer 26

1. Higher Costs

Question 27

The major purpose of a code of ethics for members of a healthcare
executives association is to:
1.
Provide guidance to members in their own professional conduct.
2.
Increase public understanding of the professional association.
3.
Provide a framework for disciplining members when necessary.
4.
Provide a framework for annually evaluating professional performance.

Answer 27

1.

Provide guidance to members in their own professional conduct.

Question 28

Effective facilities maintenance depends on:
1.
Life-cycle planning of equipment.
2.
An up-to-date inventory of equipment parts for replacement.
3.
A periodic update of a preventive maintenance schedule.
4.
Maintaining facilities on a preventive schedule.

Answer 28

4.

Maintaining facilities on a preventive schedule.

Question 29

When a member of the medical/professional staff requires disciplinary
action, it is the ultimate responsibility of the:
1.
CEO of the healthcare organization.
2.
Governing authority.
3.
Medical director or chief of staff.
4.
Chief of the clinical service (department chairman).

Answer 29

2. Governing Authority

Question 30

Temporary working capital needs should be financed through:

1. Leasing of equipment.
2. Short-term debt.
3. Equity financing.
4. Accounts receivable.

Answer 30

2. Short Term Debt

Question 31

Which of the following rules applies to the purchase of major diagnostic or
treatment equipment?
1. Physician input is required by the accrediting body.
2. Competitive bidding is required by government programs.
3. The decision should be based on equipment depreciation schedules.
4. Funds should be allocated annually in accordance with the organization’s capital schedule.

Answer 31

4. Funds should be allocated annually in accordance with the organization’s capital schedule.

Question 32

The principal advantage for an inpatient facility to affiliate with a geriatric-
care program is that such an arrangement:
1. Provides for a continuum of care for patients.
2. Permits patients to receive care in the home settings.
3. Requires less skilled personnel to provide the care.
4. Is less costly to the patient.

Answer 32

1. Provides for a continuum of care for patients.

Question 33

Quality of patient care can best be measured by:
1. Carefully constructed written reports comparing different time periods.
2. A review of incident reports.
3. Reviewing the minutes of the medical/professional executive
committee.
4. A combination of statistical reports and direct supervision of patient
care.

Answer 33

4. A combination of statistical reports and direct supervision of patient
   care.

Question 34

The thrust of antitrust legislation as applied to the healthcare field is to:

1. Contain costs.
2. Contain rising costs of independent single unit hospital.
3. Monitor the scope of health services provided in a given area.
4. Protect the public’s economic interest.

Answer 34

Protect the public’s economic interest.

Question 35

A hospice may be described as a/an:

1. Intermediate-care facility.
2. Extended-care facility that specializes in the treatment of the chronically ill.
3. Facility where terminally ill patients can receive special attention.
4. Interrelated group of healthcare services.

Answer 35

3. Facility where terminally ill patients can receive special attention.

Question 36

Which one of the following is the most important element of communication
in contract management?
1. Negotiating.
2. Controlling.
3. Directing.
4. Feedback.

Answer 36

4. Feedback.

Question 37

To obtain the most objective evaluation of state-of-the-art computer
technology, the healthcare executive should ultimately:
1. Survey local computer users.
2. Undertake a literature search.
3. Rely upon the in-house management information systems committee.
4. Utilize outside experts.

Answer 37

4. Utilize outside experts.

Question 38

The primary function of an extended-care unit is to provide:

1. Post-acute care services in a rehabilitation-oriented environment.
2. Self-care facilities for ambulatory patients.
3. Additional facilities for geriatric cases.
4. More intensive nursing care for chronically ill patients.

Answer 38

1. Post-acute care services in a rehabilitation-oriented environment.

Question 39

Which one of the following conditions must be met for human subjects to be
used in a medical research program?
1. No suitable animal model exists for use instead of people.
2. The research program has been approved by the medical staff.
3. The research program has been approved by the governing authority.
4. Risks should be clearly explained in understandable language to
each individual subject.

Answer 39

4. Risks should be clearly explained in understandable language to
   each individual subject.

Question 40

In developing a health promotion program for marketing to business, the most important factor is:
1.
Generation of sufficient additional revenue to justify potential risk.
2.
Development of a high-quality product to serve the needs and interests of the clientele.
3.
Enhancement of the institution’s image within the community.
4.
Achievement of institutional goals and missions by helping to ensure good health

Answer 40

2. Development of a high-quality product to serve the needs and interests of the clientele.