Comparing a capitated environment to a fee-for-service environment; in a capitated environment a. each additional visit creates costs without a corresponding increase in revenues, b. the total revenues line on a CVP graph is flat rather than upward sloping, c. less utilization rather than more utilization enhances profitability, d. providers of health services also take on an insurance function, e. all of the above. 11. Activity based costing is a. Generally better than traditional costing, but more expensive to implement than traditional costing. b. Is only suitable for large organizations. c. Generally not as accurate as traditional costing. d. Is generally less expensive to implement than traditional costing. 12. In allocating support services to other support service departments, which method is easiest? a. Direct method b. Reciprocal method c. Step-down method 13. In allocating support services to other support service departments, which method is most accurate? a. Direct method b. Reciprocal method c. Step-down method 14. Which of the following is not true? a. A price setter usually has a large market share, b. Price setters must watch costs more closely than price takers, c. A health provider in a competitive market is usually a price taker, d. A health care provider can be both a price setter and a price taker, e. All of the above are true. 15. Health care providers are a. Price takers. b. Price setters. c. A price setter or price taker, depending on their costing method. d. Either a price setter or price taker, depending on the competition. 16. Which is more likely to be used by a price taker? a. Target costing, b. Full cost pricing, c. Cross subsidization, d. Marginal cost pricing. 17. Which is more likely to be used by a price setter wanting to provide a full range of services to constituents at various wealth levels? a. Target costing b. Full cost pricing c. Cross subsidization d. Marginal cost pricing 18. To allocate the cost of Financial Services in a Health Care setting a. Patient revenues is a better cost driver. b. The number of bills is a better cost driver. c. We are better to not allocate the cost of Financial Services. d. Using both the number of bills and patient revenues may be the best method. 19. Government intervention in healthcare, to insure care for the poor, will likely move healthcare providers toward a. Being price takers and using target costing b. Being price setters and using target costing c. Being price setters and using cross subsidization d. Being price takers and using cross subsidization
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