HPHM 4311 Health Systems Policy & Mgt - Midterm Exam Review (Qns & Ans) - TTUHSC 2025, Exams of Nursing

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HPHM 4 3 11 Principles of Health

Systems Policy & Management

Midterm Exam Review

(Questions & Solutions)

1. Multiple Choice Question: A state government is considering a major healthcare reform to expand Medicaid coverage. Which policy objective is most likely to be prioritized by policymakers?

• A. Increasing provider reimbursements only
• B. Reducing administrative costs exclusively
• C. Enhancing access to care for low-income residents
• D. Expanding specialty care services without changes to eligibility Correct ANS : C. Enhancing access to care for low-income residents Rationale: Healthcare reforms aimed at Medicaid typically focus on improving access for low-income populations. Policymakers prioritize increased coverage that leads to earlier intervention and better population health outcomes rather than simply adjusting reimbursements or administrative expenses.

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2. Fill-in-the-Blank Question: The __________ framework is used extensively in health systems management to analyze internal strengths and weaknesses alongside external opportunities and threats. Correct ANS : SWOT Rationale:

A, B, C, D

Rationale: A comprehensive policy analysis in health systems must include financial sustainability, legislative/regulatory implications, market competition, and the social context. While patient satisfaction is important, relying on it exclusively (E) does not capture the full spectrum of policy impacts.

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5. Multiple Choice Question: A regional health system is evaluating its value-based reimbursement model. Which of the following is a key benefit of value-based care over fee-for-service models?

• A. Increased volume of services provided
• B. Emphasis on quality and outcomes
• C. Reduced administrative burden only
• D. Fixed reimbursement rates regardless of outcomes Correct ANS : B. Emphasis on quality and outcomes Rationale: Value-based care models reward healthcare providers for positive patient outcomes rather than the volume of services offered, incentivizing quality improvement and efficient care management.

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6. Fill-in-the-Blank Question: The __________ is a regulatory framework that governs the reimbursement policies for hospitals under the Medicare prospective payment system (PPS).

Correct ANS : Diagnosis-Related Group (DRG) Rationale: The DRG system groups inpatient hospital cases into categories that are expected to consume similar resources, thereby standardizing hospital payments based on the determined diagnosis and severity.

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7. True/False Question: True or False: An essential component of health systems management is understanding the effect of external pressures such as changes in federal policy, technological advancements, and demographic shifts. Correct ANS : True Rationale: Healthcare managers must constantly monitor external factors— including legislative changes, evolving technologies, and shifts in population demographics—as these directly influence service demand, reimbursement policies, and strategic planning.

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8. Multiple Response Question: Which tools can healthcare managers use to forecast future resource needs and evaluate a project’s financial viability? (Select all that apply)

• A. Net Present Value (NPV) analysis
• B. Internal Rate of Return (IRR)
• C. Break-even analysis

10. Fill-in-the-Blank Question: A __________ analysis is used to assess the financial performance of a healthcare system by comparing different cost centers and their impact on overall profitability. Correct ANS : cost center Rationale: Cost center analysis allows managers to identify areas where expenditures can be controlled. It helps in understanding the cost dynamics within different departments, thus supporting better financial decision-making.

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11. True/False Question: True or False: Integrating evidence-based management practices in healthcare systems helps improve service quality and operational efficiency by aligning strategies with current research findings. Correct ANS : True Rationale: Evidence-based management relies on research and data analysis to inform decision-making processes, ensuring that healthcare strategies improve efficiency and quality of care by adopting best practices.

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12. Multiple Response Question:

Which of the following are primary sources of revenue for hospitals participating in government programs? (Select all that apply)

• A. Medicare reimbursements
• B. Medicaid reimbursements
• C. Private insurance payments
• D. Tuition fees from medical education programs
• E. Outpatient clinic revenue Correct ANS s: A, B, C, E Rationale: Major revenue sources in healthcare include Medicare, Medicaid, private insurance, and outpatient services. Tuition fees (D) are generally considered educational revenue rather than clinical revenue.

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13. Multiple Choice Question: 

A health system is considering a strategic initiative to adopt a new electronic health record (EHR) system. Which financial metric will most effectively determine whether the new system will generate long-term value relative to its cost?

• A. Payback period
• B. Internal Rate of Return (IRR)
• C. Net Present Value (NPV)
• D. Break-even point Correct ANS : C. Net Present Value (NPV) Rationale: NPV calculates the present value of future cash flows from the investment, providing a clear measure of long-term value creation. A

16. Multiple Response Question: Which of the following are key components of a strategic plan in a healthcare organization? (Select all that apply)

• A. Mission and vision statements
• B. Comprehensive SWOT analysis
• C. Detailed short-term operational procedures only
• D. Long-term goals and performance metrics
• E. Market segmentation and target audience identification Correct ANS s: A, B, D, E Rationale: A strategic plan should include a clear mission and vision (A), a SWOT analysis (B), long-term goals with defined performance metrics (D), and clear market segmentation (E). Focusing solely on short-term operational procedures (C) is insufficient.

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17. Multiple Choice Question: In healthcare management, which term describes the process of integrating all organizational functions to achieve effective communication and workflow?

• A. Horizontal integration
• B. Vertical integration
• C. Process integration
• D. System integration Correct ANS :

D. System integration Rationale: In a complex healthcare environment, system integration refers to aligning processes, information systems, and communication across different departments to enhance overall efficiency and continuity of care.

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18. Fill-in-the-Blank Question: Balanced Scorecard is a performance measurement tool that assesses organizational performance across multiple perspectives: financial, customer, internal processes, and __________. Correct ANS : learning and growth Rationale: The Balanced Scorecard provides a multi-dimensional approach to performance evaluation by including learning and growth, which reflects the organization’s ability to innovate, improve, and sustain operations over time.

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19. True/False Question: True or False: A risk management plan in healthcare should address both internal risks such as process inefficiencies and external risks like regulatory changes. Correct ANS : True

• C. Centralizing all administrative functions
• D. Eliminating noncore service lines Correct ANS : B. Achieving economies of scale through resource sharing Rationale: Strategic alliances are often formed to share resources, reduce costs, and improve efficiency by achieving economies of scale. This collaborative approach benefits both organizations rather than merely reducing competition.

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22. Fill-in-the-Blank Question: 

A __________ plan outlines the steps necessary for implementing strategic changes and includes timelines, responsibilities, and key performance indicators. Correct ANS : implementation Rationale: An implementation plan provides a clear roadmap to execute strategic initiatives by detailing the tasks, responsibilities, and timeframes required to achieve the desired organizational outcomes.

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23. True/False Question: 

True or False: Scenario planning in healthcare strategy involves developing multiple potential future scenarios to guide flexible decision- making in response to uncertainty.

Correct ANS : True Rationale: Scenario planning prepares organizations for multiple possible futures, allowing them to adapt strategies depending on how external conditions—such as policy shifts or economic changes—evolve. It is a critical tool for managing uncertainty in healthcare.

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24. Multiple Response Question: Which analytical tools are most effective for assessing the external environment and competitive landscape in healthcare? (Select all that apply)

• A. PESTEL analysis
• B. SWOT analysis
• C. Porter’s Five Forces
• D. Time-series analysis exclusively
• E. Benchmarking Correct ANS s: A, B, C, E Rationale: PESTEL analysis, SWOT analysis, Porter’s Five Forces, and benchmarking enable healthcare organizations to thoroughly evaluate external conditions and competitive dynamics. Time-series analysis (D) is generally used for trend analysis rather than comprehensive environmental scanning.

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27. True/False Question: True or False: In organizational change management, engaging middle managers as change agents is essential for facilitating effective and sustainable transitions. Correct ANS : True Rationale: Middle managers are critical in translating strategic objectives into operational actions. By engaging them in change initiatives, organizations enhance the likelihood of successful implementation and sustained transformation.

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28. Multiple Response Question: Which factors most influence internal organizational performance in the context of healthcare strategy? (Select all that apply)

• A. Leadership style and managerial expertise
• B. Employee engagement and satisfaction
• C. Internal communication systems
• D. Patient demographics only
• E. Organizational structure and culture Correct ANS s: A, B, C, E Rationale: Internal performance is shaped by leadership, employee engagement,

effective communication, and organizational culture/structure. While patient demographics are important, they fall under external market factors rather than internal performance directly.

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29. Multiple Choice Question: A healthcare organization’s board of directors mandates an overhaul of the strategic plan to adapt to market disruptions and emerging technologies. Which process best facilitates the reevaluation and renewal of strategic goals?

• A. Strategic planning sprints
• B. Continuous Quality Improvement (CQI) projects
• C. Strategic reorientation via periodic reviews
• D. Annual performance reviews only Correct ANS : C. Strategic reorientation via periodic reviews Rationale: Periodic strategic reviews allow an organization to assess market changes and adapt its strategic goals accordingly. This process enables continuous evolution and alignment with both external and internal factors impacting the organization.

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30. Fill-in-the-Blank Question: An effective healthcare strategy integrates long-term planning with short-term operational adjustments, ensuring that the organization remains both __________ and agile in a constantly changing environment.

efficiently, as they bear the financial risk for the services provided. True/False: The U.S. healthcare system is a single-payer system. ANS : False Rationale: The U.S. healthcare system is a multi-payer system, involving a mix of public and private insurance, as well as out-of-pocket payments. Multiple Response: Which of the following are considered key stakeholders in the U.S. healthcare system? (Select all that apply) a) Pharmaceutical companies b) Patients c) Insurance companies d) The federal government e) Foreign governments ANS : a), b), c), and d) Rationale: All the listed entities, except foreign governments, play significant roles in the U.S. healthcare system. Multiple Choice: What is the primary purpose of health policy? a) To regulate the pharmaceutical industry. b) To allocate resources and address health issues within a population. c) To ensure profits for healthcare providers.

d) To eliminate all forms of healthcare disparities. ANS : b) To allocate resources and address health issues within a population. Rationale: Health policy is designed to shape the healthcare system, allocate resources, and improve population health. Fill-in-the-Blank: \_\_\_\ is a system of healthcare financing in which the government pays for healthcare services. ANS : Single-payer Rationale: Single-payer systems, like those in Canada, involve the government as the primary payer for healthcare. True/False: The concept of "moral hazard" suggests that individuals with health insurance are more likely to utilize healthcare services than those without insurance. ANS : True Rationale: Moral hazard describes the tendency for insured individuals to increase their consumption of healthcare services because they do not bear the full cost. Multiple Response: Which of the following are potential consequences of healthcare cost inflation? (Select all that apply)