CAAMA STUDY GUIDE

The examination for the designation of Credentialed Member of the American Academy of Medical Administrators (CAAMA; or CFAAMA for Academy Fellows) is a test of general knowledge in the field of healthcare administration. While successful completion of the examination does not certify any relationship to a level of performance nor is it a predictor of success in the field of healthcare management, it does indicate that the candidate evidenced knowledge in the recognized Body of Knowledge (BOK) for healthcare administration and that the candidate was knowledgeable in regard to current issues and developments in the field.

QUALIFICATIONS NECESSARY TO APPLY

1. Applicants must currently be in a management position in the healthcare field and have attained the level of Member in the Academy; and hold a baccalaureate degree and four years of successful healthcare related management experience, or hold a masters degree and one year of successful healthcare related management experience.

2. Submit a non-refundable fee of $200.00; in the event that the candidate is unsuccessful, the examination may be re-taken up to a maximum of three additional times without charge. A “no-show” (registering but not attending without notice) counts as one exam session.

3. Applications must be received no later than thirty days prior to the scheduled date to be eligible to take the examination. Visit the Academy website (www.aameda.org) or call Headquarters (847-759-8601) for examination dates and locations.

PREPARING FOR THE EXAMINATION

The following general information is intended to provide the candidate with fundamental information on how to prepare for the examination. The examination has two parts. The first section is comprised of one hundred (100) objective questions that test the candidate’s awareness of the BOK. The second section requires the candidate to respond in written form to three questions based on current healthcare issues and developments.

Examination results will be reported on a pass/fail basis only.

The examination is based on the basic body of knowlege, understanding, skills and values relevant to healthcare administration as defined by the Accrediting Commission on Education for Health Service Administration (ACEHSA). Such information and learning can be achieved from work experience, reading, professional associations as well as formal academic education.

Consideration is given to the eight ACEHSA areas outlined below in the development of the credentialing examination.

1. Assessment and understanding of the health status of populations; determinants of health and illness; and factors influencing the use of health services.
2. Understanding of the organization, financing, and delivery of health services, drawing on the social science disciplines (broadly defined to include economics, law, political science, psychology, sociology, and related disciplines).
3. Understanding of, and development of skills in, economic, financial, policy, and quantitative analysis.
4. Understanding of the values and ethical issues associated with the practice of health services administration, and the development of skills in ethical analysis.
5. Understanding of, and development of skills in, positioning organizations favorably in the environment and managing these organizations for continued effectiveness.
6. Understanding of leadership creativity and communication skill development.
7. Understanding of, and development of skills in, the management of human resources, information systems, and capital.
8. Understanding of, and development of skills in, methods for assessing overall organizational performance and, in particular, assuring quality of services provided.

 THE OBJECTIVE EXAMINATION

The objective section of the examination is comprised of one hundred (100) multiple choice questions. From the eight core areas, questions will be selected to test the applicant’s knowledge and understanding of the language, tools, and concepts central to administrative practice. To assist the candidate in preparing for the examination, the following sample questions have been selected from the examination question bank. Correct answers to the sample questions appear after the section on the essay portion of the exam.

1. The term health system loosely describes all the resources a country devotes to health promotion, disease prevention, and medical care, including health organizations and their relationships. Health systems continually evolve in response to changes in all of the following ways except for
a. demographic and disease patterns of populations
b. political power of physicians related to the power of governments, consumers, and other service providers
c. technical and biomedical developments that shape organizational roles
d. managerial and labor disputes on salary and benefits
e. public policies regarding medical care quality, access, and cost
Answer: ______

2. The balance of hospital care, home care, and long term care along with an appropriate mix of preventative vs. curative care is termed
a. case-mix
b. allocative efficiency
c. sound financial business
d. component analysis
e. bureaucracy
Answer: ______

3. Fundamental to the financial condition of a healthcare delivery system are the mechanisms used for provider reimbursement and the levels at which providers are reimbursed. The method of reimbursement that pays providers a fixed amount per member per month is called
a. fee schedule
b. capitation
c. RBRVS
d. per diem
e. DRGs
Answer: ______

4. The management of XYZ Hospital is concerned about the performance trend shown by the institution in recent years. Which of the following financial statements will be most useful in any effort to analyze and correct the situation?
a. the balance sheet
b. the income statement
c. the inventory statement
d. the schedule of debt
e. the cash flow statement
Answer: ______

5. Expenses that may vary directly with the quantity of work being performed are _________ costs
a. fixed
b. semi-variable
c. variable
d. rolling budget
e. semi-fixed
Answer: ______

6. The useful life of a computer terminal at a hospital computer center is known to be normally distributed with a mean of 3.25 years and a standard deviation of 0.5 years. What percentage of computer terminals have a useful life of less than 4 years?
a. 6.68%
b. 43.32%
c. 56.68%
d. 66.80%
e. 93.32%
Answer: ______

7. A change from FIFO to LIFO inventory pricing for purchased supplies, in times of rising prices, will at period end
a. overstate the value of inventory on hand
b. understate the value of inventory on hand
c. create an increase of inventory shelf-life waste
d. none of the above
Answer: ______

8. If representatives of competing hospitals get together and agree to fix prices on certain services, which of the following federal laws has been violated:
a. Sherman Act
b. Robinson-Patman Act
c. Clayton Act
d. Taft-Hartley Act
Answer: ______

9. Which of the following is a primary reason why health systems decentralize authority to operating divisions?
a. to establish uniform operating methods
b. to take advantage of a strong corporate staff
c. to provide better coordination of activities among operating divisions
d. to increase accountability by establishing profit centers
Answer: ______

10. Healthcare Re-engineering can be defined as
a. a variation of total quality management that seeks to improve patient care processes through benchmarking, use of statistical tools, and customer satisfaction data
b. the radical redesign of the critical systems and processes used to produce, deliver and support patient care in order to achieve dramatic improvements in organizational performance within a short period of time
c. a redesign of patient care so that hospital resources and personnel are organized around the patient
d. a bottom up approach to quality improvement that focuses on sustained, incremental process improvement over time
Answer: ______

11. Which of the following theories of motivation proposes that workers tend to be motivated when they desire a particular reward and believe that their effort will result in a level of performance that earns the reward?
a. Equity theory
b. Expectancy theory
c. Hierarchy of Needs theory
d. Reinforcement theory
Answer: ______

12. The tendency for cohesive groups to attempt to maintain harmony is known as
a. groupthink
b. group problem solving
c. informal organization
d. informal manipulation
Answer: ______

13. Which of the following is most likely to enhance the flow of accurate information within an organization?
a. using Theory X as a management style
b. requiring written communication and making sure that everyone receives a copy
c. minimizing the number of organizational levels
d. relying on the use of informal communication channels
Answer: ______

14. Each health care organization should have an ongoing and active risk management program designed to objectively evaluate the quality and appropriateness of clinical care as it relates to the chances of loss to the organization. Choose the correct ordering of the five accepted phases of the risk management process.
a. monitor and improve the program, identify loss, examine alternative techniques, choose the best technique for resolution, implement the technique
b. identify loss, examine alternative techniques, choose the best technique for resolution, implement the technique, monitor and improve the program
c. identify loss, choose the best technique for resolution, examine alternative techniques, implement the technique, monitor and improve the program
d. monitor and improve the program, identify loss, choose the best technique for resolution, examine alternative techniques, implement the techniques
e. monitor and improve the program, choose the best technique for resolution, examine alternative techniques, implement the technique, identify loss
Answer: ______

15. Nursing is labor intensive, and in most organizations 50% or more of the total budgeted personnel complement is allocated to nursing service. Nursing administrators, especially under managed care, must focus on clinical outcomes and the quantity of time required to care for patients. Nursing service uses a process to group patients and to quantify the patient care requirements by increments of time, which is based on:
a. a patient acuity system
b. national standards and state laws in effect
c. labor standards
d. patient demographics
e. patient care unit activity
Answer: ______

16. Managers are individuals who plan, organize, direct, control and coordinate activities in order to move the organization toward:
a. higher profits
b. greater social influence
c. desired objectives
d. economic stability
Answer: ______

17. In 1992, HCFA began implementation of a fee schedule for physicians who participate in Part B of Medicare. This system is referred to as:
a. APG
b. DRG
c. MSO
d. RBRVS
Answer: ______

18. When demand is elastic:
a. price increases cause total revenue to decline
b. price increases cause total revenue to increase
c. price decreases cause total revenue to decline
d. both b and c
Answer: ______

19. There are four techniques commonly use for analyzing capital projects. Which of the following is the method used to calculate how many years of net cash flow is required to recover the total cost of the original purchase?
a. Time adjusted return
b. Marginal rate of return
c. Payback method
d. Net present value method
Answer: ______

20. Which of the following actions would tend to increase cash?
a. An increase in Accounts Receivable
b. A reduction in Retained Earnings
c. A reduction in Accounts Payable
d. A reduction in Supplies Inventory
Answer: ______

THE ESSAY SECTION

The sample essay section has two questions. The first question is intended to provide the candidates an opportunity to organize and express their thoughts and to demonstrate an awareness of the environment. Subject matter for this question will be drawn from current “cover stories” in leading healthcare publications. The following questions have been selected from the examination bank.  

What will the healthcare delivery system look like during the first ten years of the 21st Century? In approximately 250 to 300 words, discuss the changes you envision happening by then.

The second question is intended to provide the candidates an opportunity to demonstrate a reasoned understanding of the practical ramifications of a current administrative issue or challenge. The following question has been selected from the examination bank.

Risk-bearing contracts are a new challenge for provider organizations becoming active in direct contracting in managed care. Discuss some of the risks involved in direct contracting by providers and how they can address this issue to insure viability of their contracts.

When taking the actual exam, please take a moment or two with each topic to organize your thoughts and present your response in an organized and cohesive fashion that will demonstrate your grasp and understanding of the issue. In addition to factual correctness, the grading of these essays will take into account the following: – Was the essay well organized?
– Was there a logical flow of ideas?
– Did the answer demonstrate understanding of and insight into important healthcare concepts?
– Were the points, arguments or opinions presented in the essay supported with facts and/or logic?

ANSWERS TO OBJECTIVE QUESTIONS
1. D 2. B 3. B 4. B 5. C
6. E 7. B 8. A 9. D 10. B
11. B 12. A 13. B 14. B 15. A
16. C 17. D 18. D 19. C 20. D

READING MATERIALS AND PREPARATION RECOMMENDATIONS

Healthcare web sites:

• www.census.gov
  www.dhhs.gov
  www.hcfa.gov
  www.hcfa.gov/stats*
  www.jcaho.org
  www.pub.whitehouse.gov
  www.loc.gov
  www.aameda.org

Healthcare journals:

• Modern Healthcare
• Hospitals and Health Networks
• American Journal of Public Health
• Healthcare Financial Management
• AAMA Journal of Cardiovascular Management
• AAMA Journal of Oncology Management
• AAMA Executive

D. Reading list: (* Strongly recommended for CAAMA Examination Study)

Specific AAMA References:

• AAMA Code of Ethics
• AAMA Bylaws
• AAMA Membership Criteria
• AAMA Advancement Criteria
• AAMA Philosophy, Mission, Role and Strategic Plan