Free AHM-520 – Health Plan Finance and Risk Management Practice Test Question

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  True
  

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  False
  

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  The net effect of using provider reimbursement contracts to transfer risk is that the health plan’s net worth requirement increases.
  

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  Once the health plan has transferred utilization risk to its providers, it is relieved of the legal obligation to provide medical services to plan members in the event of the provider’s insolvency.
  

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  The greater the amount of risk the health plan transfers to providers, the larger the credit-risk factor becomes in the health plan’s RBC formula.
  

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  By decreasing its utilization risk, the health plan increases its underwriting risk.
  

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  durational rating
  

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  retrospective experience rating
  

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  blended rating
  

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  prospective experience rating
  

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  Typically, a health plan medically underwrites both the employees of a small group and their dependents, even though small group reform laws prohibit health plans from singling out individuals for rejection or substandard rate-ups.
  
  Both A and B
  

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  In the absence of laws mandating otherwise, a health plan's underwriting standards grow stricter as group size gets smaller.
  
  
  A only
  

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  B only
  

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  Neither A nor B
  

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  Most Medicare and Medicaid enrollees can disenroll from a health plan on a monthly basis
  

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  The high incidences of chronic illness in both the Medicare and Medicaid populations results in higher costs related to coordinating care and case management
  

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  Medicare and Medicaid enrollees tend to have a high level of costs in the first few months of enrollment as the health plan educates them about the health plan system and performs initial health screening to evaluate their health
  

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  all of the above
  

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  Employees covered by a small group plan to contribute 100% of the cost of the healthcare coverage
  

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  The small group to have no more than 10 members
  

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  A minimum level of participation in order for a small group to be eligible for healthcare coverage
  

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  Its underwriters to consider the characteristics of the employer, but not of the group members, when underwriting the group
  

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  $2,000,000
  

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  $2,600,000
  

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  $2,660,000
  

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  $3,900,000
  

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  Adding new customer service representatives
  

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  Maintaining the existing staff
  

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  Installing a new switching station
  

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  Installing additional phone lines
  

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  Measure its performance and practices against those of other companies to help identify those practices that will lead to superior performance in a variety of financial and non-financial areas
  

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  Calculate the percentage changes in its financial statement items over several consecutive accounting periods
  

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  Determine both the direction and velocity of trends in its financial statements
  

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  Display only percentage relationships in its financial statements
  

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  $4.17
  

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  $8.33
  

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  $9.17
  

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  $10.00
  

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  Coral's equity holders have an ownership interest in the health plan
  

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  The interest that Coral pays on its debt most likely is not tax deductible to Coral
  

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  Coral's debt holders have no legal claim to Coral's assets
  

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  Equity is a more risky source of capital, from Coral's perspective, than is debt
  

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  Under this new methodology, Medicare-contracting health plans are paid the lower of (a) a floor payment amount per enrollee covered or (b) the health plan's payment rate increased by 2% from the previous year.
  

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  The new methodology has decreased the rate of growth in payments from CMS to Medicare-contracting health plans.
  

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  Under this new methodology, Medicare-contracting health plans are paid 90% of the adjusted average per capita cost (AAPCC) of providing a service to a beneficiary.
  

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  Under the principal inpatient diagnostic cost group (PIP-DCG), a new risk adjustment methodology, Medicare-contracting health plans will no longer be required to calculate and submit to CMS a Medicare adjusted community rate (ACR).
  

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  Estimated cost of providing services to a beneficiary under Medicare FFS, adjusted for factors such as age and gender
  

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  Health plan’s estimate of the premium it would charge Medicare enrollees in the absence of Medicare payments to the health plan
  

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  Average amount the health plan expects to receive from CMS per beneficiary covered
  

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  Health plan’s actual costs of providing benefits to Medicare enrollees in a given year
  

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  Amendments to the HMO Act of 1973 require federally qualified HMOs to adjust a group's prior premiums on the basis of the group's experience during the prior rating period.
  

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  The Consolidated Omnibus Budget Reconciliation Act (COBRA) of 1986 requires that, if a plan sponsor elects to terminate its group coverage with a health plan, then the health plan must continue its coverage for the COBRA-qualified beneficiaries in the group.
  

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  The Health Insurance Portability and Accountability Act (HIPAA) of 1996 generally requires the guaranteed renewal of healthcare coverage for certain individuals and for both small and large groups, regardless of the health status of any member.
  

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  The Mental Health Parity Act (MHPA) of 1996 mandates that all health plans must offer benefits for mental healthcare.
  

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  vary only on the factors that affect Fiesta's costs
  

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  are at a level that balances Fiesta's need to generate a profit against its need to obtain or retain a specified share of the market in which it conducts business
  

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  are high enough to ensure that Fiesta has enough money on hand to pay operating expenses as they come due
  

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  do not exceed what Fiesta needs to cover its costs and provide the plan with a fair profit