Question 1

The following statements are about the Federal Employees Health Benefits Program (FEHBP), which is administered by the Office of Personnel Management (OPM). Three of the statements are true and one statement is false. Select the answer choice that contains the FALSE statement.

Accepted Answer

The answer of The following statements are about the Federal...

Question 2

The following answer choices describe various approaches that a health plan can take to voice its opinions on legislation. Select the answer choice that best describes a health plan's use of grassroots lobbying.

Accepted Answer

Grassroots lobbying involves mobilizing the general public to contact key legislators and voice their support or opposition for a particular legislation. The Stellar Health Plan's use of direct mail and telephone calls to encourage people to support a patient rights bill and contact legislators is an example of grassroots lobbying.

Question 3

The Balanced Budget Act (BBA) of 1997 created the Medicare+Choice plan. One provision of the BBA under Medicare+Choice is that the BBA

Accepted Answer

The BBA of 1997 aimed to reduce geographic payment disparities by adjusting the growth rates of payments to Medicare health plans, increasing rates in low-payment areas and decreasing them in high-payment areas.

Question 4

A federal law that significantly affects health plans is the Health Insurance Portability and Accountability Act of 1996 (HIPAA). In order to comply with HIPAA provisions, issuers offering group health coverage generally must.

Accepted Answer

The answer of A federal law that significantly affects health...

Question 5

While traditional workers' compensation laws have restricted the use of managed care techniques, many states now allow managed workers' compensation. One common characteristic of managed workers' compensation plans is that they

Accepted Answer

The answer of While traditional workers' compensation laws have restricted...

Question 6

Any willing provider laws have their share of proponents and opponents. Arguments commonly made in opposition to any willing provider laws include

Accepted Answer

Any willing provider laws can limit consumer choice to more costly coverage options because they require health plans to accept any provider willing to meet the terms, potentially reducing the ability to negotiate lower rates with a limited network.

Question 7

In 1994, the Department of Justice (DOJ) and the Federal Trade Commission (FTC) revised their 1993 healthcare-specific antitrust guidelines to include analytical principles relating to multiprovider networks. Under the new guidelines, the regulatory agencies will use the rule of reason to analyze joint pricing activities by competitors in physician or multiprovider networks only if

Accepted Answer

The answer of In 1994, the Department of Justice (DOJ)...

Question 8

The government uses various tools within the realm of two broad categories of public policyallocative policies and regulatory policies. In the context of public policy, laws that fall into the category of allocative policy include

Accepted Answer

Allocative policies involve the distribution of resources, and the Balanced Budget Act (BBA) of 1997 is an example as it involves allocation of federal funds and resources.

Question 9

One example of health plan's influence on the practice of medicine is that, during the past decade, the focus of healthcare has moved toward _________________, which is designed to reduce the overall need for healthcare services by providing patients with decision-making information.

Accepted Answer

Demand management is a strategy used by health plans to control healthcare costs by educating patients about their health conditions and treatment options. This allows patients to make informed decisions about their healthcare, leading to better overall health outcomes and a reduced need for healthcare services. As a result, healthcare providers are more likely to implement this strategy in their practices, as it aligns with the goals of the health plan. Managed competition, comprehensive coverage, and private inurement are all other aspects of health plans, but they do not necessarily influence the practice of medicine in the same way that demand management does.

Question 10

SoundCare Health Services, a health plan, recently conducted a situation analysis. One step in this analysis required SoundCare to examine its current activities, its strengths and weaknesses, and its ability to respond to potential threats and opportunities in the environment. This activity provided SoundCare with a realistic appraisal of its capabilities. One weakness that SoundCare identified during this process was that it lacked an effective program for preventing and detecting violations of law. SoundCare decided to remedy this weakness by using the 1991 Federal Sentencing Guidelines for Organizations as a model for its compliance program. By definition, the activity that SoundCare conducted when it examined its strengths, weaknesses, and capabilities is known as

Accepted Answer

The activity described in the scenario is an internal assessment, which involves evaluating an organization's current activities, strengths and weaknesses, and ability to respond to potential threats and opportunities. This process provides the organization with a realistic appraisal of its capabilities and can help identify areas for improvement. In this case, SoundCare identified a weakness in its compliance program and decided to use a model to develop a new program.

Question 11

Health plans should monitor changes in the environment and emerging trends, because changes in society will affect the managed care industry. One true statement regarding recent changes in the environment in which health plans operate is that

Accepted Answer

Women have been shown to have higher healthcare utilization rates and are more likely to interact with health plans than men throughout their lifetimes. This demographic trend is important for health plans to consider when developing and marketing their services. Choices B, C, and D are all false statements. The focus of healthcare has not shifted away from outpatient care, but rather towards it with the rise of value-based care and telehealth. The uninsured population has not been decreasing in recent years, but rather increasing again in 2019-2020. And while overall inflation has decreased, healthcare inflation has remained high.

Question 12

After conducting a business portfolio analysis, the Acorn Health Plan decided to pursue a harvest strategy with one of its strategic business units (SBUs)-Guest Behavioral Healthcare. By following a harvest strategy with Guest, Acorn most likely is seeking to

Accepted Answer

A harvest strategy involves maximizing short-term earnings and cash flow by reducing investment in the SBU. This suggests that Acorn is looking to extract as much value as possible from Guest Behavioral Healthcare before potentially divesting or restructuring the SBU in the future.

Question 13

The board of directors of the Garnet Health Plan, an integrated delivery system (IDS), includes physicians and hospital representatives who sometimes feel compelled to represent a specific organization that is only one part of the IDS. Such a circumstance can lead to ___________, which is a situation in which the members of the board focus on the best interests of component parts of the enterprise rather than on the best interests of Garnet as a whole.

Accepted Answer

Representational governance is a situation where board members feel obligated to represent their specific organization rather than the best interests of the overall enterprise. This can lead to conflicts of interest and decision-making that prioritizes the interests of individual components of the enterprise over the enterprise as a whole.

Question 14

The National Association of Insurance Commissioners (NAIC) adopted the Health Maintenance Organization Model Act (HMO Model Act) to regulate the development and operations of HMOs. One true statement regarding the HMO Model Act is that the act

Accepted Answer

The HMO Model Act requires HMOs to place a deposit in trust with the state insurance commissioner as a measure to protect the interests of enrollees in case the HMO becomes financially impaired. Option A is incorrect because the act does not specifically mention mental health services within its definition of basic healthcare services. Option B is incorrect because the act allows for multiple state agencies to regulate HMOs. Option D is incorrect because the act does not require HMOs to contract with licensed insurance companies to offer point-of-service options to plan members.

Question 15

In examining accountability in the current managed care environment, one is likely to find that combinations of various models of accountability are in operation. Under one model of accountability, the primary mechanisms for accountability are the mechanisms of the marketplace-failure to meet standards will result in a loss of demand for services. By definition, this model of accountability is called the

Accepted Answer

The model of accountability that primarily relies on the mechanisms of the marketplace is the economic model of accountability. This is because failure to meet standards will result in a loss of demand for services, leading to financial implications for the organization. The other options - professional, political, and due diligence models of accountability - do not focus primarily on marketplace mechanisms.

Question 16

Regulators of health plans have set standards in a number of areas of plan operations. Requirements with which health plans must comply typically include

Accepted Answer

Regulators of health plans typically set standards in all of these areas, requiring health plans to provide detailed information to enrollees and prospective enrollees, maintain internal grievance and appeals processes, and have quality assurance programs in place. Compliance with these requirements helps ensure that health plans operate in a transparent and fair manner and provide high-quality care to their enrollees.

Question 17

The following situations illustrate per se violations of federal antitrust laws: Situation A - Two groups of providers agreed among themselves that each provider will do business with health plans only on a fee-for-service basis. Situation B - In order to avoid competing with each other, two independent, competing physicianhospital organizations (PHOs) divide the geographic areas in which they will market their services. From the following answer choices, select the response that correctly identifies the types of per se violations illustrated by these situations.

Accepted Answer

Situation A involves two groups of providers agreeing to a specific method of pricing for their services, which is a clear violation of antitrust laws against price fixing.

Situation B involves two competing PHOs dividing geographic markets in order to avoid competition, which falls under the category of horizontal division of markets.

Question 18

Determine whether the following statement is true or false: Although most-favored-nation (MFN) clauses in contracts between health plans and healthcare providers are not per se illegal, they should be reviewed under the rule of reason analysis for antitrust purposes.

Accepted Answer

Although MFN clauses are not per se illegal, they may violate antitrust laws if they have a predatory purpose and an anticompetitive effect. Therefore, they should be reviewed under the rule of reason analysis for antitrust purposes. The Federal Trade Commission (FTC) has not encouraged health plans to include them in provider contracts, but rather has expressed concerns about their potential anticompetitive effects. MFN clauses do not involve decisions by providers concerning the level of fees to charge, and they are not exempt from antitrust laws and regulation by the FTC.

Question 19

State X issued a nonresident license to Tamara Pensky, a sales representative of the Verity Health Plan. In doing so, State X imposed a countersignature requirement, which requires that

Accepted Answer

A countersignature requirement typically means that applications solicited by a nonresident agent must be signed by a resident agent or someone with a resident license to ensure compliance with state regulations.

Question 20

n the paragraph below, a statement contains two pairs of terms enclosed in parentheses. Determine which term in each pair correctly completes the statement. Then select the answer choice containing the two terms that you have chosen. Every employee benefit plan governed by the Employee Retirement Income Security Act (ERISA) must distribute a summary plan description (SPD) to participants within (90 / 120) days after the date on which the plan is adopted or made effective. Thereafter, if the plan is amended, a new SPD must be distributed every (5 / 10) years.

Accepted Answer

ERISA requires that a summary plan description (SPD) be distributed within 120 days after the plan is adopted or made effective, and a new SPD must be distributed every 5 years if the plan is amended.

Exam 2: Governance and Regulation

The following statements are about the Federal Employees Health Benefits Program (FEHBP) , which is administered by the Office of Personnel Management (OPM) . Three of the statements are true and one statement is false. Select the answer choice that contains the FALSE statement.