AHIMA Revenue Cycle Management 1 — Questions and Answers
Question 1: What is revenue cycle management in healthcare?
- The financial process tracking patient service from registration through final payment (Correct answer)
- Managing hospital revenue only from grants
- Counting daily patient visits
- Setting doctor salaries
Correct answer: The financial process tracking patient service from registration through final payment
RCM encompasses the entire financial lifecycle: patient registration, insurance verification, coding, claim submission, payment posting, and collections.
Question 2: What is prior authorization?
- Approval from an insurance company required before certain services are provided (Correct answer)
- A patient's signature on a consent form
- A doctor's license verification
- A hospital's accreditation
Correct answer: Approval from an insurance company required before certain services are provided
Prior authorization requires providers to obtain insurance company approval before delivering specific services, ensuring medical necessity and coverage.
Question 3: What is a claim denial?
- An insurance company's refusal to pay for a submitted healthcare claim (Correct answer)
- A patient refusing treatment
- A doctor denying a referral
- A hospital closing a department
Correct answer: An insurance company's refusal to pay for a submitted healthcare claim
Claim denials occur when insurers refuse payment due to errors, lack of authorization, non-covered services, or insufficient documentation.
Question 4: What is accounts receivable in healthcare?
- Money owed to the healthcare organization for services already provided (Correct answer)
- Money in the bank
- Prepaid insurance premiums
- Government grants received
Correct answer: Money owed to the healthcare organization for services already provided
Accounts receivable represents outstanding payments for services rendered, tracked by age (30, 60, 90+ days) to monitor collection efficiency.
Question 5: What is the chargemaster?
- A comprehensive listing of all billable items and their prices used by a healthcare facility (Correct answer)
- A hospital employee who manages billing
- A government price list
- A patient's itemized bill
Correct answer: A comprehensive listing of all billable items and their prices used by a healthcare facility
The chargemaster (charge description master) is a hospital's master price list for all services, procedures, supplies, and drugs used for billing purposes.
Question 6: What is an EOB (Explanation of Benefits)?
- A statement from an insurer showing what was billed, what insurance paid, and what the patient owes (Correct answer)
- A medical diagnosis summary
- A prescription refill notice
- A hospital discharge summary
Correct answer: A statement from an insurer showing what was billed, what insurance paid, and what the patient owes
The EOB details the claim processing results: services billed, amounts allowed, insurance payment, adjustments, and the patient's remaining financial responsibility.
AHIMA Revenue Cycle Management 1
What is revenue cycle management in healthcare?