A Healthcare Executive Is Using Regression to Predict Total Revenues

question 91

Multiple Choice

A healthcare executive is using regression to predict total revenues.She has decided to include both patient length of stay and insurance type in her model.Insurance type can be grouped into the following categories: Medicare,Medicaid,Managed Care,Self-Pay,and Charity.Which of the following is true?

• A)Insurance type will be represented in the regression model by five binary variables.
• B)Insurance type will be represented in the regression model by six dummy variables.
• C)Insurance type will be represented in the regression model by five dummy variables.
• D)Insurance type will be represented in the regression model by four binary variables.
• E)Neither binary nor dummy variables are necessary for the regression model.

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Definitions:

Single Investment Application Rate

A metric used to assess the potential return on an individual investment to determine its profitability or effectiveness.

Overhead Application

The process of assigning or allocating overhead costs to produced goods or services, often using a predetermined overhead rate.

Activity-Based Management Method

The activity-based management method is a technique that uses detailed information about activities and their costs to manage and improve business processes.

Support Department Costs

Expenses incurred by the service departments that assist other internal departments rather than directly producing a product or service.