Question 1

HMOs typically employ several techniques to manage provider utilization and member utilization of medical services. One technique that an HMO uses to manage member utilization is

Accepted Answer

Copayments for office visits are a technique used by HMOs to manage member utilization by making members share in the cost of services, which can discourage unnecessary use of medical services.

Question 2

In accounting terminology, the items of value that a company owns-such as cash, cash equivalents, and receivables-are generally known as the company's

Accepted Answer

The items of value that a company owns are referred to as assets in accounting terminology. This includes cash, cash equivalents, and receivables, as well as other items such as property, equipment, and inventory. Revenue refers to the amount of money a company earns from its operations, while net income is the profit that remains after all expenses have been deducted. Surplus is a term that generally refers to excess amounts of something, such as inventory or funds, but is not specifically related to accounting terminology.

Question 3

If a state commissioner of insurance places an HMO under administrative supervision, then the purpose of this action most likely is to:

Accepted Answer

Placing an HMO under administrative supervision means that the state commissioner of insurance is taking control of the HMO's operations. This is typically done in order to ensure that the HMO is operating in a way that is beneficial to its members and is financially stable. The state commissioner or a person appointed by the commissioner will oversee the HMO's operations while it is under administrative supervision. The other options (transferring the HMO's business to other carriers, taking control of and administering the HMO's assets and liabilities, and selling the HMO's assets) are not typically done in this situation.

Question 4

Health savings accounts were created by which of the following laws:

Accepted Answer

Health savings accounts (HSAs) were created by the Medicare Modernization Act of 2003. COBRA and HIPAA are federal laws related to health insurance, but they did not create HSAs.

Question 5

Health plans sometimes contract with independent organizations to provide specialty services, such as vision care or rehabilitation services, to plan members. For health plan partners what is required?

Accepted Answer

The answer of Health plans sometimes contract with independent organizations...

Question 6

In 1999, the United States Congress passed the Financial Services Modernization Act, referred to as the Gramm-Leach-Bliley (GLB) Act. The primary provisions included under the GLB Act require financial institutions, including health plans, to take several

Accepted Answer

The GLB Act requires financial institutions to notify customers about the sharing of their non-public personal financial information with nonaffiliated third parties and provide them with the opportunity to opt-out of such sharing.

Question 7

Identify the CORRECT statement(s): (A) Smaller the group, the more likely it is that the group will experience losses similar to the average rate of loss that was predicted. (B) Gender of the group's participants has no effect on the likelihood of loss.

Accepted Answer

Smaller groups are less likely to experience losses similar to the average rate due to less risk pooling. Gender can affect the likelihood of loss in certain contexts, such as health insurance.

Question 8

Historically most HMOs have been

Accepted Answer

The answer of Historically most HMOs have been
...

Question 9

Ian Vladmir wants to have a routine physical examination to ascertain that he is in good health. Mr. Vladmir is a member of a health plan that will allow him to select the physician of his choice, either from within his plan's network or from outside of h

Accepted Answer

A point of service (POS) option allows members to see physicians outside of the plan's network for a higher cost, while still providing coverage for in-network care. This would give Mr. Vladmir the flexibility to choose the physician of his choice, either from within his plan's network or from outside of it.

Question 10

In 1999, the United States Congress passed the Financial Services Modernization Act, which is referred to as the Gramm-Leach-Bliley (GLB) Act. The following statement(s) can correctly be made about this act:

Accepted Answer

The answer of In 1999, the United States Congress passed...

Question 11

Health plans' use of the Internet to provide plan members with health-related information has grown rapidly in recent years. One advantage the Internet has over other forms of communication is that

Accepted Answer

The advantage the Internet has over other forms of communication is that it can be accessed using a variety of different types of computer systems, including desktop computers, laptops, tablets, and smartphones. This makes it more convenient and accessible for plan members to access health-related information anytime and anywhere.

Question 12

If left unresolved, member complaints about the actions or decisions made by a health plan or its providers can lead to formal appeals. One procedure health plans can use to address formal appeals is to submit the original decision and any supporting info

Accepted Answer

A Level One appeal is typically the first step in the appeals process, and if the member is not satisfied with the outcome, they usually have the right to a further appeal.

Question 13

In assessing the potential degree of risk represented by a proposed insured, a health underwriter considers the factor of antiselection. Antiselection can correctly be defined as the

Accepted Answer

Antiselection is the tendency of people who have a greater-than-average likelihood of loss to apply for or continue insurance protection to a greater extent than people who have an average or less than average likelihood of the same loss. This can increase the potential degree of risk for the insurer, as they may end up insuring a group of people who are more likely to file claims and require medical treatment. Health underwriters consider antiselection when assessing the risk presented by a proposed insured to determine the appropriate premium and coverage options.

Question 14

Health plans require utilization review for all services administered by its participating physicians.

Accepted Answer

Utilization review is typically required for certain services, especially those that are high-cost or high-risk, but not necessarily for all services.

Question 15

Health plans use the following to determine the number of providers to add to a network:

Accepted Answer

Health plans use all three factors - staffing ratios, drive time and geographic availability - to determine the number of providers to add to a network. Staffing ratios are used to ensure that there are enough providers to meet the needs of the population in a given area, while drive time and geographic availability are used to ensure that providers are easily accessible to members. All of these factors are considered in order to create a network that is comprehensive and accessible to all members.

Question 16

Health plans often program into their claims processing systems certain criteria that, if unmet, will prompt further investigation of a claim. In an automated claims processing system, these criteria may signal the need for further review when, for example:

Accepted Answer

Edits in an automated claims processing system are criteria or rules that, if unmet, trigger further review or investigation of a claim. They help ensure that claims meet specific requirements before approval.

Question 17

Immediate evaluation and treatment of illness or injury can be provided in any of the following care settings:

Accepted Answer

The answer of Immediate evaluation and treatment of illness or...

Question 18

If most of the physicians, or many of the physicians in a particular specialty, are affiliated with a single entity, then a health plan building a network in the service area _____________.

Accepted Answer

If most of the physicians in a particular specialty are affiliated with a single entity, the health plan most likely needs to contract with that entity in order to build a comprehensive network. This will allow the health plan to provide its members with access to a sufficient number of physicians and specialty care services.

Question 19

In addition to the credentialing activities that a health plan performs when initially accepting a provider into its network, the health plan must also perform recredentialing of the same providers on an ongoing basis. Many of the same activities are per

Accepted Answer

The answer of In addition to the credentialing activities that...

Question 20

Health plans may use different capitation arrangements for different levels of service. One typical capitation arrangement provides a capitation payment that may include primary care only, or both primary and secondary care, but not ancillary services.  This type of capitation arrangement is known as a:

Accepted Answer

A partial capitation arrangement provides a capitation payment that may include primary care only, or both primary and secondary care, but not ancillary services. This type of capitation arrangement is different from a global capitation arrangement, which includes all levels of service, and a gatekeeper arrangement, which requires patients to seek all services through a primary care provider. A carve-out arrangement is when a health plan contractually separates certain services from the capitation payment and pays for them separately.

Exam 3: Health Plan Finance and Risk Management