Deck 6: Health Services Financing

Question 1

Which method of risk assessment is required by the ACA for individual and small-group health insurance?

A)Experience rating
B)Pure community rating
C)Adjusted community rating
D)Risk selection

Answer 1

Adjusted community rating

Question 2

National health expenditures (E) =

A)P x Q
B)Q / P
C)P / Q
D)(P x Q) / P

Answer 2

P x Q

Question 3

In a general sense, what is the primary purpose of insurance?

A)Predicting risk
B)Risk assessment
C)Protection against risk
D)Underwriting

Answer 3

Protection against risk

Question 4

Controlling total health care expenditures by restricting financing for health insurance.

A)Top-down control
B)Demand-side rationing
C)Underwriting
D)Underutilization

Question 5

What is the primary mechanism that enables people to obtain health care services?

A)Availability of services
B)Health insurance
C)Payment for services
D)Control of expenditures

Question 6

What is the main advantage of group insurance?

A)More people can obtain insurance from a single insurer
B)Risk is spread out among a large number of insured
C)More comprehensive services can be covered than under an individual plan
D)The employer has to deal with only one insurance company

Question 7

Liberal reimbursement for a given technology will _____ innovation, diffusion, and utilization of that technology.

A)decrease
B)have no effect on
C)increase
D)prevent

Question 8

What was the main conclusion of the Rand Health Insurance Experiment

A)Cost sharing lowered health care utilization without any significant health consequences
B)Cost sharing lowered health care utilization but there were significant health consequences
C)Cost sharing did not affect health care utilization
D)Cost sharing increased health care utilization

Question 9

Cost is shifted from people in poor health to the healthy when

A)premiums are based on experience rating
B)people purchase individual private health insurance policies instead of group policies
C)first-dollar coverage is predominant
D)premiums are based on community rating

Question 10

What is the central role of health services financing in the United States?

A)Fund health insurance
B)Underwrite medical risk
C)Support managed care
D)Balance the supply of health care professionals

Question 11

Private health insurance is also referred to as

A)mandatory health insurance
B)public insurance
C)employee health insurance
D)voluntary health insurance

Question 12

The phenomenon called 'moral hazard' results directly from

A)the uninsured status of a segment of the U.S.population
B)inadequate payment to providers
C)managed care enrollment
D)health insurance coverage

Question 13

Self insurance was spurred by

A)employers
B)government policy
C)self-employed people
D)managed care organizations

Question 14

The Employee Retirement Income Security Act (ERISA), 1974

A)exempts self-insured plans from certain mandatory benefits
B)mandates that employers provide comprehensive health coverage under their health insurance benefits
C)requires that low-income individuals be charged a lower premium than those in high-income categories
D)outlawed discrimination in health insurance and retirement benefits

Question 15

A health insurance plan pays for medical care only after the insured has first paid $1,000 out of pocket on an annual basis.The $1,000 annual cost is called

A)first-dollar coverage
B)coinsurance
C)premium
D)deductible

Question 16

Under experience rating,

A)costs shift from people in poor health to people in good health
B)favorable risk groups pay a lower premium than high-risk groups
C)premiums rise for every one regardless of risk
D)deductibles and copayments are eliminated

Question 17

Medigap policies are sold by

A)private insurance companies
B)the government
C)HMOs
D)Medicare

Question 18

Under community rating

A)premiums are based on risk rating
B)premiums are based on a group's utilization of health care services
C)high-risk individuals pay a higher premium than low-risk individuals
D)both high-risk and low-risk people are charged the same premium

Question 19

A copayment is generally paid

A)once a year
B)each time the insured receives health care services
C)in form of a deduction from payroll checks
D)by the employer to purchase health insurance on behalf of each covered employee

Question 20

In national health care systems, total expenditures are controlled mainly through

A)cost shifting
B)underwriting
C)supply-side rationing
D)demand-side rationing

Question 21

Under the Affordable Care Act what purpose do the exchanges serve?

A)They allow individuals and small businesses to purchase health plans.
B)They facilitate enrollment in Medicaid, CHIP, or a private health plan.
C)They replace the state insurance commissions.
D)They allow states to exchange information to establish a benchmark plan.

Question 22

Skilled nursing care is covered under _____ of Medicare.

A)Part A
B)Part B
C)Part C
D)Part D

Question 23

In general, how do bronze, silver, gold, and platinum health plans differ?

A)They differ according the benefits offered.
B)They differ according to cost sharing.
C)They differ according to both benefits and cost sharing.
D)They differ according to the length of service with an employer.

Question 24

The HI portion of Medicare is financed through

A)Premiums from enrollees
B)General taxes
C)Payroll taxes
D)None of the above

Question 25

The ACA specifies that ______ can be covered under their parents' health insurance plans.

A)Children attending college
B)Children who are unemployed
C)Children up to the age of 19
D)Children under the age of 26

Question 26

For hospitalizations, Medicare beneficiaries must pay a deductible

A)each time they are admitted to a hospital
B)once per benefit period
C)on discharge from a hospital
D)None of the above

Question 27

To finance Medicare Part A,

A)enrollees are required to pay a subsidized premium
B)only employers are required to pay a payroll tax
C)all income earned by a working person is subject to Medicare tax
D)employee wages are taxed up to a certain ceiling that is raised each year

Question 28

The 'doughnut hole' in Medicare prescription drug coverage

A)applies after a beneficiary has fully met the deductible.
B)suspends the payment of monthly premiums.
C)is designed to suspend benefits if monthly premiums are not paid.
D)provides no benefits until the beneficiary qualifies for the catastrophic level.

Question 29

SMI provides

A)hospital coverage
B)skilled nursing facility coverage
C)prescription drugs
D)physician services

Question 30

Part C of Medicare specifically covers

A)rehabilitation services
B)preventive care
C)prescription drugs
D)None of the above

Question 31

Why was Medicare Part C created?

A)To add a prescription drug benefit to the Medicare program
B)To channel beneficiaries into managed care programs
C)To provide services to children up to the age of 19
D)To extend benefits to people with end-stage renal disease

Question 32

What criterion does the ACA use to classify an employer as a large employer?

A)The employer has 50 or more full-time-equivalent employees.
B)The employer has 200 or more full- and part-time employees.
C)The employer offers health insurance to all its employees.
D)The employer has at least 100 full-time-equivalent employees.

Question 33

What is the main function of the Medicare Payment Advisory Commission (MedPAC)?

A)To determine Medicare reimbursement to various providers
B)To advise the US Congress on various issues affecting the Medicare program
C)To control total Medicare expenditures
D)To establish Medicare policy

Question 34

For Medicare beneficiaries, the maximum stay in a SNF during a benefit period cannot exceed

A)30 days
B)60 days
C)100 days
D)None of the above

Question 35

The majority of beneficiaries receiving health care through Medicare are

A)elderly
B)disabled
C)financially poor
D)those suffering from end-stage renal disease

Question 36

Medicare Part B premiums are

A)standard for everyone
B)market-based
C)income-based
D)None of the above

Question 37

The SMI Trust Fund is for

A)Part A
B)Part B
C)Parts A and B
D)Parts B and D

Question 38

To purchase private insurance through an exchange, premium subsidies are made available to people with incomes up to

A)138% of federal poverty level
B)200% of federal poverty level
C)300% of federal poverty level
D)400% of federal poverty level

Question 39

How are preexisting medical conditions covered under the Affordable Care Act?

A)They will continue to be covered under a special federal program.
B)States are mandated to have risk pools to cover preexisting conditions.
C)Private insurance plans have to cover them starting 2014.
D) There is no provision in the law to cover preexisting conditions.

Question 40

The primary criterion to become eligible for Medicaid is

A)age
B)medical necessity
C)financial status
D)family emergency

Question 41

An MS-DRG is a refined DRG that includes

A)patient severity
B)costs incurred in treating a patient
C)adjustment for treating patients on Medicaid
D)adjustment for readmissions within 30 days of discharge

Question 42

Preferred providers are paid

A)prospective fees
B)capitated fees
C)bundled fees
D)negotiated discounted fees

Question 43

In general, prospective payment systems establish reimbursement for

A)resources already used
B)services already provided
C)bundled services
D)costs incurred in the delivery of services

Question 44

What perverse incentive is present in retrospective reimbursement?

A)Providers can increase their profits by increasing costs.
B)Providers reduce their profits if they increase costs.
C)Serving more patients would reduce profits.
D)It leads to underutilization of health care services.

Question 45

When a fixed monthly fee per enrollee is paid to a provider, it is called

A)Bundled fee
B)Charge
C)Capitation
D)Retrospective reimbursement

Question 46

_____ reimbursement is based on the assumption that health care is provided in a set of identifiable and individually distinct units of services.

A)Bundled-fee
B)Cost-plus
C)Prospective
D)Fee-for-service

Question 47

Which of the following is not a type of prospective reimbursement methodology?

A)Ambulatory patient classification
B)Diagnosis-related groups
C)Case mix
D)Cost-plus

Question 48

RVUs reflect

A)units of services delivered
B)resource inputs
C)the dollar value of services
D)coding of physician services

Question 49

The insurance arm of military health care is called

A)CHAMPUS
B)VISN
C)VHA
D)TRICARE

Question 50

To receive payment for services delivered, providers must file a ____ with third-party payers.

A)bill
B)claim
C)fee-schedule
D)charge

Question 51

Under the DRG method of reimbursement, an acute care hospital is paid

A)a per-diem rate based on the DRG classification
B)a fixed amount for a particular DRG classification
C)a fixed amount for each day of care
D)an amount based on the use of resources in treating a patient

Question 52

A DRG represents

A)cumulative days of care
B)a group of principal diagnoses
C)bundled fees established prospectively
D)number of discharges from the hospital

Question 53

The use of fee-for-service reimbursement

A)has been eliminated
B)has been greatly reduced
C)has been increased
D)has not been affected by innovative methods

Question 54

Capitation removes the incentive to

A)control costs.
B)provide unnecessary services.
C)file a reimbursement claim.
D)underutilize health care.

Question 55

The amount of reimbursement is determined before the services are delivered.

A)Retrospective reimbursement
B)Cost-plus reimbursement
C)Prospective reimbursement
D)Fee-for-service

Question 56

What is the incentive under fee-for-service reimbursement?

A)Payers have the incentive to reduce reimbursement
B)Patients have the incentive to consume more services than necessary
C)Providers have an incentive to deliver nonessential services
D)Insurers have an incentive to reduce premium costs

Question 57

How is case mix determined for an inpatient facility?

A)A comprehensive assessment of each patient is done.
B)Patients are classified according to case-mix groups.
C)A case-mix index is created.
D)Case mix is determined by the principal diagnosis of each patient.

Question 58

By law, federal matching funds to the states for Medicaid cannot be less than

A)25%
B)33%
C)50%
D)80%

Question 59

Under the DRG method of reimbursement, a psychiatric hospital is paid

A)a per-diem rate based on psychiatric DRGs
B)a case-specific rate based on psychiatric DRGs
C)a fixed amount per admission
D)an amount determined by resources used in treating a patient

Question 60

Under retrospective reimbursement, a health care organization is paid according to

A)predetermined rates.
B)the number of patients served.
C)the costs incurred in operating the institution.
D)fees established by the organization

Question 61

Public (government) share of the total health care spending in the United States is approximately

A)25%
B)35%
C)45%
D)55%

Question 62

Under community rating, people are charged the same premium regardless of health risk.

Question 63

The government plays a significant role in financing health care services in the United States.

Question 64

Under the ACA, private health insurance will no longer be the main source of coverage.

Question 65

Today, the majority of health insurance exists in the form of managed care plans.

Question 66

Part D of Medicare does not require the payment of a premium.

Question 67

Health insurance plans are allowed to have annual dollar limits on a person's medical benefits.

Question 68

Under the Medicare program, eligibility criteria and benefits are consistent throughout the US.

Question 69

Health insurance increases the demand for health care services.

Question 70

Adverse selection makes health insurance less affordable for

A)those in poor health
B)those covered by public insurance
C)those in good health
D)high-risk individuals

Question 71

The largest share of national health expenditures is attributed to:

A)Structures and equipment
B)Personal health care
C)Net cost of private health insurance
D)Public health activities

Question 72

People in older age groups represent a higher risk than those in lower age groups.

Question 73

Medicaid recipients are classified as medically uninsured.

Question 74

What is the Minimum Data Set (MDS)?

A)It is a data collection instrument used mainly for clinical research.
B)It facilitates the determination of case-mix groups in rehabilitation hospitals.
C)It is a patient assessment instrument for skilled nursing facilities.
D)It facilitates the determination of ambulatory payment classifications in outpatient centers.

Question 75

If national health expenditures amount to 18% of the GDP, what does this mean?

A)The growth in total health care expenditures is 18%.
B)Domestic production of health care products and services has increased by 18%.
C)Health care costs are 18% of the total revenues in the health care industry.
D)Health care consumes 18% of the total economic production.

Question 76

The ACA requires that employers provide health insurance to part-time workers if the employer has 50+ full-time equivalent workers.

Question 77

By law, a health insurance plan must cover work-related injuries.

Question 78

It is illegal for an insurance company to sell a Medigap plan to someone who is covered by Medicaid.

Question 79

Health insurance plans are prohibited from having lifetime dollar limits on medical benefits.

Question 80

Tax policy in the U.S.provides an incentive to obtain employer-paid health insurance.