Prior to the Enactment of the Health Maintenance Organization Act

question 36

Multiple Choice

Prior to the enactment of the Health Maintenance Organization Act of 1973, the growth of a physician's practice would be based on:

• A) advertising and referrals.
• B) managed care contracts.
• C) consultations.
• D) hospital affiliations.

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Definitions:

Fixed Monthly Expenses

Costs that do not vary from month to month, such as rent, insurance, and salaries.

Unit Variable Cost

The cost associated with producing an additional unit of product, which includes materials, labor, and any other expenses that increase with each unit produced.

Monthly Sales

The total revenue generated from sales of goods or services within a month.

Net Operating Income

The total profit of a company after operating expenses are deducted but before taxes and interest are subtracted.