Question 1

The Avignon Company discontinued its contract with a traditional indemnity insurer and contracted exclusively with the Minaret Health Plan to provide the sole healthcare plan to Avignon's employees. By agreeing to an exclusive contract with Minaret, Avignon has entered into a type of healthcare contract known as
A) a carrier guarantee arrangement
B) open access
C) total replacement coverage
D) selective contract coverage

Accepted Answer

Total replacement coverage refers to a situation where an employer offers only one health plan option to its employees, replacing any previous plans. In this case, Avignon Company has replaced its traditional indemnity insurer with the Minaret Health Plan as the sole option.

Question 2

The National Committee for Quality Assurance (NCQA) has integrated accreditation with Health Employer Data and Information Set (HEDIS) measures into a program called Accreditation '99. One statement that can correctly be made about these accreditation standards is that
A) Health plans are required by law to report HEDIS results to NCQA
B) HEDIS restricts its reporting criteria to a narrow group of quantitative performance measures, while NCQA includes a broad range of qualitative performance measures
C) Private employer groups purchasing health care coverage increasingly require both NCQA accreditation and HEDIS reporting
D) HEDIS includes measures of a health plan's effectiveness of care rather than its cost of care

Accepted Answer

The statement that best aligns with the information provided is that private employer groups purchasing health care coverage increasingly require both NCQA accreditation and HEDIS reporting. While it is true that health plans are required to report HEDIS results to NCQA, and that HEDIS includes measures of a health plan's effectiveness of care rather than its cost of care, these statements are not directly indicated as part of the Accreditation '99 program in the given context. However, the fact that accreditation and reporting are both sought after by private employer groups suggests that both NCQA accreditation and HEDIS reporting have become important standards in the industry. The statement that HEDIS restricts its reporting criteria to a narrow group of quantitative performance measures, while NCQA includes a broad range of qualitative performance measures, is not accurate - in fact, HEDIS measures include both quantitative and qualitative components, while NCQA accreditation standards are known for their rigorous emphasis on objective, measurable performance criteria.

Question 3

The Gardenia Health Plan has a national reputation for quality care. When Gardenia entered a new market, it established a preferred provider organization (PPO), a health maintenance organization (HMO), and a point-of-service product (POS) to serve the plan members in this market. All of the providers included in the HMO or the POS are included in the broader provider panel of the PPO. The POS will be a typical two-level POS that offers a cost-based incentive plans for PCPs, and the HMO is a typical staff model HMO. The network strategy that Gardenia is using to establish its range of healthcare plans is known as the
A) network-within-a-network approach
B) gatekeeper approach
C) tiered network approach
D) preferred tier approach

Accepted Answer

Gardenia's strategy of including all HMO and POS providers within the broader PPO network aligns with the network-within-a-network approach, where a subset of providers is part of a larger network.

Question 4

After HIPAA was enacted, Congress amended the law to include the Mental Health Parity Act (MHPA) of 1996, a federal requirement relating to mental health benefits. One true statement about the MHPA is that it
A) requires all health plans to provide coverage for mental health services
B) requires health plans to carve out mental/behavioral healthcare from other services provided by the plans
C) allows health plans to require patients receiving mental health services to pay higher copayments than patients seeking treatment for physical illnesses
D) prohibits health plans that offer mental health benefits from applying more restrictive limits on coverage for mental illness than on coverage for physical illness

Accepted Answer

The Mental Health Parity Act (MHPA) of 1996 prohibits health plans that offer mental health benefits from applying more restrictive limits on coverage for mental illness than on coverage for physical illness. It does not require all health plans to provide coverage for mental health services or carve out mental/behavioral healthcare from other services provided by the plans, and it also does not allow health plans to require patients receiving mental health services to pay higher copayments than patients seeking treatment for physical illnesses.

Question 5

The Gardenia Health Plan has a national reputation for quality care. When Gardenia entered a new market, it established a preferred provider organization (PPO), a health maintenance organization (HMO), and a point-of-service product (POS) to serve the plan members in this market. All of the providers included in the HMO or the POS are included in the broader provider panel of the PPO. The POS will be a typical two-level POS that offers a cost-based incentive plans for PCPs, and the HMO is a typical staff model HMO. The following statement(s) can correctly be made about Gardenia's establishment of the PPO and the staff model HMO in its new market: 1. When establishing its PPO network, Gardenia most likely initiated outcomes measurement tools and developed collaborative process improvement relationships with providers. 2. To avoid high overhead expenses in the early stages of market evelopment, Gardenia's HMO most likely contracted with specialists and ancillary providers until the plan's membership grew to a sufficient level to justify employing these specialists.
A) Both 1 and 2
B) Neither 1 nor 2
C) 1 Only
D) 2 Only

Accepted Answer

The answer of The Gardenia Health Plan has a national...

Question 6

The sizes of the businesses in a market affect the types of health programs that are likely to be purchased. Compared to smaller employers (those with fewer than 100 employees), larger employers (those with more than 1,000 employees) are
A) more likely to contract with indemnity health plans
B) more likely to offer their employees a choice in health plans
C) less likely to contract with health plans
D) less likely to require a wide variety of benefits

Accepted Answer

Larger employers with more than 1,000 employees are more likely to offer their employees a choice in health plans as they have larger budgets and can negotiate better rates with health plans. Small employers with fewer than 100 employees may not have the resources to offer multiple options to their employees and are more likely to contract with a single health plan. Therefore, option B is the best answer.

Question 7

Lakesha Frazier, a member of a health plan in a rural area, had been experiencing heart palpitations and shortness of breath. Ms. Frazier's primary care provider (PCP) referred her to a local hospital for an electrocardiogram. The results of the electrocardiogram were transmitted for diagnosis via high-speed data transmission to a heart specialist in a city 500 miles away. This information indicates that the results of Ms. Frazier's electrocardiogram were transmitted using a communications system known as
A) Anarrow network
B) An integrated healthcare delivery system
C) Telemedicine
D) Customized networking

Accepted Answer

Telemedicine is the use of telecommunications technology to provide medical information and services. In this case, Ms. Frazier's electrocardiogram results were transmitted via high-speed data transmission, which is a form of telemedicine.

Question 8

Some jurisdictions have enacted corporate practice of medicine laws. One effect that corporate practice of medicine laws have had on HMO provider networks is that these laws typically
A) require incorporated HMOs to practice medicine through licensed employees
B) require HMOs to form exclusive contracts with physician groups who agree to dedicate all or most of their practices to HMO patients in return for a set payment or revenue-sharing
C) restrict the ability of staff model HMOs to hire physicians directly, unless the physicians own the HMO
D) encourage incorporated HMOs to obtain profits from their provisions of physician professional services

Accepted Answer

Corporate practice of medicine laws typically restrict the ability of staff model HMOs (HMOs that directly employ physicians) to hire physicians directly unless the physicians own the HMO. This is to prevent conflicts of interest and maintain professional medical standards. Option A and D are incorrect because they are not directly related to corporate practice of medicine laws. Option B is incorrect because it describes a type of contractual arrangement between HMOs and physician groups, rather than the effect of corporate practice of medicine laws on HMOs.

Question 9

In developing a provider network in an large city with a high concentration of young families, the Gypsum Health Plan has set goals focused on the needs of that particular market. The following statements are about this situation. Three of the statements are true, and one of the statements is false. Select the answer choice that contains the FALSE statement.
A) Gypsum should attempt to recruit providers who offer extended office hours.
B) Gypsum can use the cost-effectiveness of its own existing networks as a benchmark for its cost-savings goals in this market.
C) Gypsum will most likely attempt to contract with HMOs.
D) Gypsum most likely should set lower cost-savings goals in this market than it would in a rural market with few young families.

Accepted Answer

The answer of In developing a provider network in an...

Question 10

The National Association of Insurance Commissioners (NAIC) Managed Care Plan Network Adequacy Model Act defines specific adequacy and accessibility standards that health plans must meet. In addition, the Model Act requires health plans to
A) Hold plan members responsible for unreimbursed charges or unpaid claims
B) Allow providers to develop their own standards of care
C) Adhere to specified disclosure requirements related to provider contract termination
D) File written access plans and sample contracts with the Centers for Medicaid and Medicare Services (CMS)

Accepted Answer

The National Association of Insurance Commissioners (NAIC) Managed Care Plan Network Adequacy Model Act requires health plans to adhere to specified disclosure requirements related to provider contract termination. It does not require health plans to hold members responsible for unreimbursed charges or unpaid claims, allow providers to develop their own standards of care, or file written access plans and sample contracts with CMS.

Question 11

In the paragraph below, two statements each contain a pair of terms enclosed in parentheses. Determine which term correctly completes each statement. Then select the answer choice that contains the two terms you have chosen. In most states, a health plan can be held responsible for a provider's negligent malpractice. This legal concept is known as (vicarious liability / risk sharing). One step that health plans can take to reduce their exposure to malpractice lawsuits is to state in health plan-provider agreements, marketing collateral, and membership literature that the providers are (employees of the health plan / independent contractors).
A) Vicarious liability / employees of the health plan
B) Vicarious liability / independent contractors
C) Risk sharing / employees of the health plan
D) Risk sharing / independent contractors

Accepted Answer

The legal concept of the health plan being held responsible for a provider's negligent malpractice is known as vicarious liability. One step that health plans can take to reduce their exposure to malpractice lawsuits is to state that the providers are independent contractors, rather than employees of the health plan. Therefore, the correct answer is (B) Vicarious liability / independent contractors.

Question 12

Although a health plan is allowed to delegate many activities to outside sources, the National Committee for Quality Assurance (NCQA) has determined that some activities are not delegable. These activities include
A) evaluation of new medical technologies
B) overseeing delegated medical records activities
C) developing written statements of members' rights and responsibilities
D) all of the above

Accepted Answer

All of the above activities are deemed non-delegable by NCQA. Evaluation of new medical technologies requires expertise and knowledge specific to the health plan. Overseeing delegated medical records activities is crucial to ensure that the delegated entity is complying with all applicable laws and regulations. Developing written statements of members' rights and responsibilities requires a deep understanding of the health plan's policies and procedures. Therefore, these activities cannot be delegated to outside sources.

Question 13

The Gardenia Health Plan has a national reputation for quality care. When Gardenia entered a new market, it established a preferred provider organization (PPO), a health maintenance organization (HMO), and a point-of-service product (POS) to serve the plan members in this market. All of the providers included in the HMO or the POS are included in the broader provider panel of the PPO. The POS will be a typical two-level POS that offers a cost-based incentive plans for PCPs, and the HMO is a typical staff model HMO. One statement that can correctly be made about Gardenia's two-level POS product is that
A) members who self-refer without first seeing their PCPs will receive no benefits
B) both Gardenia and the PCPs stand to benefit if the non-provider panels are kept relatively narrow
C) members will pay higher coinsurance or copayments if they first see their PCPs each time
D) the plan offers no financial incentives to members to choose an in-network specialist over a non-network specialist

Accepted Answer

The answer of The Gardenia Health Plan has a national...

Question 14

The following statements are about factors that health plans should consider as they develop provider networks in rural and urban markets. Three of the statements are true, and one of the statements is false. Select the answer choice that contains the FALSE statement.
A) Compared to providers in urban areas, providers in rural areas are less likely to offer discounts to health plans in exchange for directed patient volume.
B) In urban areas, limiting the number of specialists on a panel usually affects the network's market appeal more than does limiting the number of primary care physicians.
C) The greatest opportunity to create competition in rural areas is among the specialty providers in other nearby communities.
D) Typically, hospital contracting is easier in urban areas than in rural areas.

Accepted Answer

The answer of The following statements are about factors that...

Question 15

Federal laws--including the Ethics in Patient Referrals Act, the Health Maintenance Organization (HMO) Act of 1973, the Employee Retirement Income Security Act (ERISA), and the Federal Trade Commission Act--have impacted the ways that health plans conduct business. For instance, the Mosaic Health Plan must comply with the following federal laws in order to operate: Regulation 1: Mosaic must establish a mandated grievance resolution mechanism, including a method for members to address grievances with network providers. Regulation 2: Mosaic must not allow its providers to refer Medicare and Medicaid patients to entities in which they have a financial or ownership interest. From the answer choices below, select the response that correctly identifies the federal legislation on which Regulation 1 and Regulation 2 are based.
A) Regulation 1 - The Ethics in Patient Referrals Act Regulation 2 - The HMO Act of 1973
B) Regulation 1 - The HMO Act of 1973 Regulation 2 - The Ethics in Patient Referrals Act
C) Regulation 1 - ERISA Regulation 2 - The Federal Trade Commission Act
D) Regulation 1 - The Federal Trade Commission Act Regulation 2 - ERISA

Accepted Answer

Regulation 1 requiring a mandated grievance resolution mechanism is based on the HMO Act of 1973 which requires HMOs to establish a grievance process for members. Regulation 2 preventing providers from referring Medicare and Medicaid patients to entities in which they have a financial or ownership interest is based on the Ethics in Patient Referrals Act which prohibits physicians from referring patients to entities in which they have a financial interest for certain designated health services.

Question 16

By definition, a measure of the extent to which a health plan member can obtain necessary medical services in a timely manner is known as
A) Network management
B) Quality
C) Cost-effectiveness
D) Accessibility

Accepted Answer

Accessibility refers to the ability for a health plan member to obtain necessary medical services in a timely manner, which is a measure of how easily accessible healthcare services are for the member. Network management refers to the management of healthcare providers in the health plan's network. Quality and cost-effectiveness are important factors for healthcare services, but they do not specifically pertain to the measure of accessibility.

Question 17

For this question, if answer choices (A) through C) are all correct, select answer choice (D). Otherwise, select the one correct answer choice. Understanding the level of health plan penetration in a particular market can help a health plan determine which products are most appropriate for that market. Indicators of a mature health plan market include
A) Areduction in the rate of growth in health plan premium levels
B) Areduction in the level of outcomes management and improvement
C) An increase in the rate of inpatient hospital utilization
D) All of the above

Accepted Answer

Option A is correct as a mature health plan market would have a reduction in the rate of growth in health plan premium levels. This is because as the market becomes more mature, there is likely to be more competition which would drive down premium levels. Option B is incorrect as a mature health plan market would have an increase in the level of outcomes management and improvement as the health plan would want to maintain and improve their quality of care to retain their customers. Option C is incorrect as a mature health plan market would have a decrease in the rate of inpatient hospital utilization as the health plan would emphasize preventative care and management of chronic conditions to reduce the need for hospitalizations.

Question 18

The Holiday Health Plan is preparing to enter a new market. In order to determine the optimal size of its provider panel in the new market, Holiday is conducting a competitive analysis of provider networks of the market's existing health plans. Consider whether, in conducting its competitive analysis, Holiday should seek answers to the following questions: Question 1: What are the cost-containment strategies of the health plans with increasing market shares? Question 2: What are the premium strategies of the health plans with large market shares? Question 3: What are the characteristics of health plans that are losing market share? In its competitive analysis, Holiday should most likely obtain answers to questions
A) 1, 2, and 3
B) 1 and 2 only
C) 1 and 3 only
D) 2 and 3 only

Accepted Answer

In order to determine the optimal size of its provider panel, Holiday needs to understand the strategies of the existing health plans with increasing market share, including their cost-containment and premium strategies. Additionally, understanding the characteristics of health plans that are losing market share can provide insights into what strategies to avoid. Therefore, Holiday should seek answers to all three questions.

Question 19

The following paragraph contains an incomplete statement. Select the answer choice containing the term that correctly completes the statement. One important activity within the scope of network management is ensuring the quality of the health plan's provider networks. A primary purpose of __________________ is to review the clinical competence of a provider in order to determine whether the provider meets the health plan's preestablished criteria for participation in the network.
A) authorization
B) provider relations
C) credentialing
D) utilization management

Accepted Answer

Credentialing involves evaluating and verifying the qualifications and clinical competence of healthcare providers to ensure they meet the pre-established criteria for participation in a health plan's provider network. Authorization involves determining whether a specific medical service or procedure is covered under a patient's health plan. Provider relations involve building and maintaining relationships with healthcare providers within the provider network. Utilization management focuses on managing the appropriate use of medical resources and services to improve quality of care and reduce costs.

Question 20

One important aspect of network management is profiling, or provider profiling. Profiling is most often used to
A) measure the overall performance of providers who are already participants in the network
B) assess a provider's overall satisfaction with a plan's service protocols and other operational areas
C) verify a prospective provider's professional licenses, certifications, and training
D) familiarize a provider with a plan's procedures for authorizations and referrals

Accepted Answer

Profiling is used to measure the overall performance of providers who are already participants in the network. This can include assessing their clinical outcomes, utilization patterns, and patient satisfaction. It is an important tool for network managers to identify areas of improvement and manage provider performance. The other options are not typically associated with profiling.

Exam 4: Network Management

The National Committee for Quality Assurance (NCQA) has integrated accreditation with Health Employer Data and Information Set (HEDIS) measures into a program called Accreditation '99. One statement that can correctly be made about these accreditation standards is that

After HIPAA was enacted, Congress amended the law to include the Mental Health Parity Act (MHPA) of 1996, a federal requirement relating to mental health benefits. One true statement about the MHPA is that it

The sizes of the businesses in a market affect the types of health programs that are likely to be purchased. Compared to smaller employers (those with fewer than 100 employees) , larger employers (those with more than 1,000 employees) are

Some jurisdictions have enacted corporate practice of medicine laws. One effect that corporate practice of medicine laws have had on HMO provider networks is that these laws typically

The National Association of Insurance Commissioners (NAIC) Managed Care Plan Network Adequacy Model Act defines specific adequacy and accessibility standards that health plans must meet. In addition, the Model Act requires health plans to

Although a health plan is allowed to delegate many activities to outside sources, the National Committee for Quality Assurance (NCQA) has determined that some activities are not delegable. These activities include

The following statements are about factors that health plans should consider as they develop provider networks in rural and urban markets. Three of the statements are true, and one of the statements is false. Select the answer choice that contains the FALSE statement.

By definition, a measure of the extent to which a health plan member can obtain necessary medical services in a timely manner is known as

One important aspect of network management is profiling, or provider profiling. Profiling is most often used to