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AHM-250 Healthcare Management: An Introduction Questions and Answers

Questions 4

One typical characteristic of preferred provider organization (PPO) benefit plans is that PPOs:

Options:

A.

Assume full financial risk for arranging medical services for their members.

B.

Require plan members to obtain a referral before getting medical services from specialists.

C.

Use a capitation arrangement, instead of a fee schedule, to reimburse physicians.

D.

Offer some coverage, although at a higher cost, for plan members who choose to use the services of non-network providers.

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Questions 5

The data evaluation stage of utilization review (UR) includes both administrative reviews and medical reviews. One true statement about these types of reviews is that:

Options:

A.

An administrative review must be conducted by a health plan staff member who is a medical professional.

B.

The primary purpose of an administrative review is to evaluate the appropriateness of a proposed medical service.

C.

UR staff members typically conduct a medical review of a proposed medical service before they conduct an administrative review for that same service.

D.

One purpose of a medical review is to evaluate the medical necessity of a proposed medical service.

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Questions 6

One device that PBM plans use to manage both the cost and use of pharmaceuticals is a formulary. A formulary is defined as

Options:

A.

a listing of drugs classified by therapeutic category or disease class that are considered preferred therapy for a given managed population and that are to be used by a health plan's providers in prescribing medications

B.

a reduction in the price of a particular pharmaceutical obtained by the PBM from the pharmaceutical manufacturer

C.

drugs ordered and delivered through the mail to the PBM's plan members at a reduced cost

D.

an identification card issued by the PBM to its plan members

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Questions 7

The Azure Group is a for-profit health plan that operates in the United States. The Fordham Group owns all of Azure's stock. The Fordham Group's sole business is the ownership of controlling interests in the shares of other companies. This information ind

Options:

A.

A holding company of the Fordham Group.

B.

A sister corporation of the Fordham Group.

C.

A subsidiary of the Fordham Group.

D.

All of the above.

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Questions 8

Patrick Flaherty's employer has contracted to receive healthcare for its employees from the Abundant Healthcare System. Mr. Flaherty visits his primary care physician (PCP), who sends him to have some blood tests. The PCP then refers Mr. Flaherty to a special

Options:

A.

an integrated delivery system (IDS)

B.

a Management Services Organization (MSO)

C.

a Physician Practice Management (PPM) company

D.

a physician-hospital organization (PHO)

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Questions 9

Specialty services that have certain characteristics generally are good candidates for managed care approaches. These characteristics generally include that the specialty service should have

Options:

A.

appropriate, rather than inappropriate, utilization

B.

a defined patient population

C.

low, stable costs

D.

a benefit that cannot be easily defined

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Questions 10

The following paragraph contains an incomplete statement. Select the answer choice containing the term that correctly completes the statement. Advances in computer technology have revolutionized the processing of medical and drug claims. Claims processing i

Options:

A.

Lower

B.

Higher

C.

Same

D.

No change

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Questions 11

The Conquest Corporation contracts with the Apex health plan to provide basic medical and surgical services to Conquest employees. Conquest entered into a separate contract with the Bright Dental Group to provide and manage a dental care program for employee

Options:

A.

a negotiated rebate agreement

B.

a carve-out arrangement

C.

an indemnity plan

D.

PBM

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Questions 12

Medicare is the federal government program established under Title XVIII of the Social Security Act of 1965 to provide hospital, medical and other covered benefits to elderly and disabled persons. Medicare is available for:

Options:

A.

Persons age 63 or older.

B.

Persons with qualifying disabilities (over the age of 63)

C.

Persons with end-stage renal disease (ESRD)

D.

Low income individuals

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Questions 13

Individuals can use HSAs to pay for the following types of health coverage:.

Options:

A.

Qualified disability insurance

B.

COBRA continuation coverage.

C.

Medigap coverage (for those over 65).

D.

All of the above.

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Questions 14

The Employee Retirement Income Security Act (ERISA) requires health plan members who receive healthcare benefits through employee benefit plans to file legal challenges involving coverage decisions or plan administration at the federal level. Under the te

Options:

A.

contract damages, which cover the cost of denied treatment

B.

compensatory damages, which compensate the injured party for his or her injuries

C.

punitive damages, which are designed to punish or make an example of the wrongdoer

D.

all of the above

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Questions 15

PBM plans operate under several types of contractual arrangements. Under one contractual arrangement, the PBM plan and the employer agree on a target cost per employee per month. If the actual cost per employee per month is greater than the target cost, t

Options:

A.

fee-for-service arrangement

B.

risk sharing contract

C.

capitation contract

D.

rebate contract

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Questions 16

The Ark Health Plan, is currently recruiting providers in preparation for its expansion into a new service area. A recruiter for Ark has been meeting with Dr. Nan Shea, a pediatrician who practices in Ark's new service area, in order to convince her to be

Options:

A.

Credentialing

B.

Accreditation

C.

A sentinel event

D.

A screening program

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Questions 17

In the United States, the Department of Defense offers ongoing healthcare coverage to military personnel and their families through the TRICARE health plan. One true statement about TRICARE is that:

Options:

A.

Active duty military personnel are automatically considered enrolled in TRICARE Prime

B.

TRICARE covers inpatient and outpatient services, physician and hospital charges, and medical supplies, but not mental health services.

C.

TRICARE enrollees are not entitled to appeal authorization or coverage decisions

D.

Hospitals participating in the TRICARE program are exempt from JCAHO accreditation and Medicare certification.

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Questions 18

Ronald Canton is a member of the Omega MCO. He receives his nonemergency medical care from Dr. Kristen High, an internist. When Mr. Canton needed to visit a cardiologist about his irregular heartbeat, he first had to obtain a referral from Dr. High to see

Options:

A.

Dr. High serves as the coordinator of care for the medical services that Mr. Canton receives.

B.

Omega's network of providers includes Dr. High, but not Dr. Miller.

C.

Omega's system allows its members open access to all of Omega's participating providers.

D.

Omega used a financing arrangement known as a relative value scale (RVS) to compensate Dr. Miller.

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Questions 19

The existing committees at the Majestic Health Plan, a health plan that is subject to the requirements of HIPAA, include the Executive Committee and the Corporate Compliance Committee. The Executive Committee serves as a long-term advisory body on issues

Options:

A.

Both 1 and 2

B.

1 only

C.

2 only

D.

Neither 1 nor 2

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Questions 20

As part of its utilization management (UM) system, the Creole Health Plan uses a process known as case management. The following individuals are members of the Creole Health Plan:

  • Jill Novacek, who has a chronic respiratory condition.
  • Abraham Rashad.

Options:

A.

Ms. Novacek, Mr. Rashad, and Mr. Devereaux

B.

Ms. Novacek and Mr. Rashad only

C.

Ms. Novacek and Mr. Devereaux only

D.

None of these members

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Questions 21

Federal legislation has placed the primary responsibility for regulating health insurance companies and HMOs that service private sector (commercial) plan members at the state level.

This federal legislation is the

Options:

A.

Clayton Act

B.

Federal Trade Commission Act

C.

McCarran-Ferguson Act

D.

Sherman Act

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Questions 22

Before the Hill Health Maintenance Organization (HMO) received a certificate of authority (COA) to operate in State X, it had to meet the state's licensing requirements and financial standards which were established by legislation that is identical to the

Options:

A.

Hill had to have an initial net worth of at least $1.5 million in order to obtain a COA.

B.

The COA most likely exempts Hill from any of State X's enabling statutes.

C.

Hill had to be organized as a partnership in order to obtain a COA

D.

The COA in no way indicates that Hill has demonstrated that it is fiscally sound.

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Questions 23

Health plans sometimes contract with independent organizations to provide specialty services, such as vision care or rehabilitation services, to plan members. Specialty services that have certain characteristics are generally good candidates for health pl

Options:

A.

Low or stable costs.

B.

Appropriate, rather than inappropriate, utilization rates.

C.

A benefit that cannot be easily defined.

D.

Defined patient population.

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Questions 24

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

Options:

A.

users can access the Internet using a number of different types of computer systems

B.

access to the Internet is available only to members of the health plan's network

C.

the Internet is immune to internal security breaches by employees or trading partners within the network

D.

users can contact a single controlling organization to rectify disruptions in Internet service

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Questions 25

For providers, integration occurs when two or more previously separate providers combine under common ownership or control, or when two or more providers combine business operations that they previously carried out separately and independently. Such provi

Options:

A.

higher costs for health plans, healthcare purchasers, and healthcare consumers

B.

improved provider contracting position with health plans

C.

an increase in providers' autonomy and control over their own work environment

D.

all of the above

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Questions 26

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

Options:

A.

Encounter reports

B.

Diagnostic codes

C.

Durational ratings

D.

Edits

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Questions 27

Historically most HMOs have been

Options:

A.

Closed-access HMO

B.

Closed-panel HMO

C.

Open-access HMO

D.

Open-panel HMO

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Questions 28

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

Options:

A.

a traditional HMO plan

B.

a managed indemnity plan

C.

a point of service (POS) option

D.

an exclusive provider organization (EPO)

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Questions 29

For this question, select the answer choice containing the terms that correctly complete the blanks labeled A and B in the paragraph below.

NCQA offers Quality Compass, a national database of performance and accreditation information submitted by managed

Options:

A.

Health Plan Employer Data and Information Set (HEDIS) mandatory

B.

Health Plan Employer Data and Information Set (HEDIS) voluntary

C.

ORYX mandatory

D.

ORYX voluntary

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Questions 30

In order to compensate for lost revenue resulting from services provided free or at a significantly reduced cost to other patients, many healthcare providers spread these unreimbursed costs to paying patients or third-party payors. This practice is known

Options:

A.

dual choice

B.

cost shifting

C.

accreditation

D.

defensive medicine

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Questions 31

As part of its utilization management (UM) system, the Poplar MCO uses a process known as case management. The following statements describe individuals who are Poplar plan members:

  • Brad Van Note, age 28, is taking many different, costly medications for

Options:

A.

Mr. Van Note, Mr. Albrecht, and Ms. Cromartie

B.

Mr. Van Note and Ms. Cromartie only

C.

Mr. Van Note and Mr. Albrecht only

D.

Mr. Albrecht and Ms. Cromartie only

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Questions 32

An exclusive provider organization (EPO) operates much like a PPO. However, one difference between an EPO and a PPO is that an EPO

Options:

A.

Is regulated under federal HMO legislation

B.

Generally provides no benefits for out-of-network care

C.

Has no provider network of physicians

D.

Is not subject to state insurance laws

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Questions 33

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:

Options:

A.

The GLB Act allows convergence among the transaction

B.

A only

C.

Both A and B

D.

B only

E.

Neither A nor B

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Questions 34

A medical foundation is a not-for-profit entity that purchases and manages physician practices. In order to retain its not-for-profit status, a medical foundation must

Options:

A.

Provide significant benefit to the community

B.

Employ, rather than contract with, participating physicians

C.

Achieve economies of scale through facility consolidation and practice management

D.

Refrain from the corporate practice of medicine

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Questions 35

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

Options:

A.

Transfer all of the HMO's business to other carriers.

B.

Allow the state commissioner, acting for a state court, to take control of and administer the HMO's assets and liabilities.

C.

Sell the HMO's assets in order to satisfy the HMO's obligations.

D.

Place the HMO's operations under the direction and control of the state commissioner or a person appointed by the commissioner.

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Questions 36

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

Options:

A.

Staffing ratios

B.

Drive time

C.

Geographic availability

D.

All of the above

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Questions 37

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

Options:

A.

the use of physician practice guidelines

B.

the requirement of copayments for office visits

C.

capitation

D.

risk pools

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Questions 38

In large health plans, management functions such as provider recruiting, credentialing, contracting, provider service, and performance management for providers are typically the responsibility of the

Options:

A.

chief executive officer (CEO)

B.

network management director

C.

board of directors

D.

director of operations

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Questions 39

Medigap policies were standardized into ten standard benefit pl ranging from A-J by the ____

Options:

A.

Omnibus Budget Reconciliation Act (OBRA) of 1990

B.

Tax Equity & Fiscal Responsibility Act (TEFRA) of 1982

C.

Medicare Modernization Act (MMA) of 2003

D.

Balanced Budget Act (BBA) of 1997

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Questions 40

To determine fee reimbursements to be paid to physicians, the Triangle Health Plan assigns a weighted value to each medical procedure or service and multiplies the weighted value by a money multiplier. Triangle and the providers negotiate the value of the

Options:

A.

Diagnosis-related group (DRG) system

B.

Relative value scale (RVS)

C.

Partial capitation arrangement

D.

Capped fee system

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Questions 41

To determine fee reimbursements to be paid to physicians, the Triangle Health Plan assigns a weighted value to each medical procedure or service and multiplies the weighted value by a money multiplier. Triangle and the providers negotiate the value of the

Options:

A.

diagnosis-related group (DRG) system

B.

relative value scale (RVS)

C.

partial capitation arrangement

D.

capped fee system

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Questions 42

The Mirror Health Plan uses a form of computer/telephony integration (CTI) to manage telephone calls coming into its member services department. When a member calls the plan's central telephone number, a device answers the call with a recorded message and

Options:

A.

a member outreach program

B.

a complaint resolution procedure (CRP)

C.

an automatic call distributor (ACD)

D.

an interactive voice response (IVR) system

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Questions 43

The Gable MCO sometimes experience-rates small groups by underwriting a number of small groups as if they constituted one large group and then evaluating the experience of the entire large group. This practice, which allows small groups to take advantage

Options:

A.

prospective experience rating

B.

pooling

C.

retrospective experience rating

D.

positioning

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Questions 44

Which of the following people would be considered part of the individual market segment?

Options:

A.

John is eligible for Medicare.

B.

Julie has coverage through an employer group.

C.

James works for an employer that does not offer health coverage.

D.

Jenny is eligible for Medicaid.

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Questions 45

The Links Company, which offers its employees a self-funded health plan, signed a contract with a third party administrator (TPA) to administer the plan. The TPA handles the group's membership services and claims administration. The contract between Links

Options:

A.

a manual rating contract

B.

a funding vehicle contract

C.

an administrative services only (ASO) contract

D.

a pooling contract

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Questions 46

Common characteristics of POS products are

Options:

A.

Lack of Freedom of choice

B.

Absence of Primary care physician

C.

Cost-cutting efforts and the structure of coverage

D.

All of the above

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Questions 47

The owners of an MCO typically delegate authority for governing the operation of the MCO by electing the MCO's

Options:

A.

quality management committee

B.

medical director

C.

board of directors

D.

chief executive officer

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Questions 48

Each time a patient visits a provider he has to pay a fixed dollar amount?

Options:

A.

Deductible

B.

Copayment

C.

Capitation

D.

Co-insurance

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Questions 49

Traditional Medicare includes two parts: Medicare Part A and Medicare Part B. With regard to the ways these parts differ from each other, it is correct to say that Medicare Part A

Options:

A.

provides benefits for physicians' professional services, whereas Medicare Part B provides basic hospitalization insurance

B.

is financed through premiums paid by covered persons and from the federal government's general tax revenues, whereas Medicare Part B is funded primarily through a payroll tax imposed on employers and workers

C.

provides 100% coverage for eligible medical expenses, whereas Medicare Part B includes annual deductible and coinsurance provisions

D.

is provided automatically to most eligible persons, whereas Medicare Part B is a voluntary program

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Questions 50

The Internal Revenue Service has ruled that an HDHP coupled with an HSA may cover certain types of preventive care without a deductible or with a lower amount than the annual deductible applicable to all other services. According to IRS guidance, which on

Options:

A.

Immunizations for children and adults

B.

Tests and diagnostic procedures ordered with routine examinations

C.

Smoking cessation programs

D.

Gastric bypass surgery for obesity

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Questions 51

The act which requires each group health plan to allow employees and certain dependents to continue their group coverage for a stated period of time following a qualifying event that causes the loss of group health coverage is:

Options:

A.

ERISA

B.

COBRA

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Questions 52

Which of the following statements about EPO & HMO models is FALSE?

Options:

A.

In-network visit is allowed only on PCP's referral in HMO model.

B.

Out-of-network visit is not allowed in HMO model.

C.

Out-of-network visit is not allowed in EPO model.

D.

In-network visit is allowed only on PCP's referral in EPO model.

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Questions 53

The Polestar Company's sole business is the ownership of Polaris Medical Group, a health plan and subsidiary of Polestar. Some members of Polestar's board of directors hold positions with Polestar in addition to their positions on the board; the rest are professionals in academia and businesspeople who do not work for Polestar. Dr. Carolyn Porter, a university president, is on Polestar's board. From the following answer choices, select the response containing the term that correctly identifies Polestar's relationship to Polaris and the term that describes the type of board member represented by Dr. Porter

Options:

A.

Polestar's relationship to Polaris: partnership: Type of board member: operations director

B.

Polestar's relationship to Polaris: partnership: Type of board member: outside director

C.

Polestar's relationship to Polaris: holding company: Type of board member: operations director

D.

Poles tar's relationship to Polaris: holding company: Type of board member: outside director

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Questions 54

Integration of provider organizations is said to occur when

Options:

A.

Previously separate providers combine & come under common ownership or control.

B.

Two or more providers combine their business operations that they previously carried out separately.

C.

Both A & B

D.

None of the above

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Questions 55

Two MCOs in a single service area divided purchasers into two groups and agreed to each market their products to only one purchaser group. This information indicates that these two MCOs violated antitrust requirements because they engaged in an activity k

Options:

A.

horizontal group boycott

B.

horizontal division of markets

C.

a tying arrangement

D.

price fixing

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Exam Code: AHM-250
Exam Name: Healthcare Management: An Introduction
Last Update: May 2, 2024
Questions: 367
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