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AHIP AHM-250 Healthcare Management: An Introduction Exam Practice Test

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Total 367 questions

Healthcare Management: An Introduction Questions and Answers

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Question 1

To achieve widespread use of electronic data interchange (EDI) in the healthcare industry, all entities within the industry need to agree on industry standards regarding the information format and software to be used. Several organizations are making cont

Options:

A.

Computer-based Patient Records Institute (CPRI)

B.

American National Standards Institute (ANSI)

C.

American Health Information Management Association (AHIMA)

D.

American Medical Association (AMA)

Question 2

Which of the following is CORRECT?

Options:

A.

Electronic transmittal of authorization is subject to the same regulatory requirements as other methods of transmittal

B.

Telephone transmittal increases data entry errors.

C.

Medical review is conducted before administrative review.

D.

Prospective review, concurrent review and retrospective review are types of utilization review

Question 3

When determining the premium rates it will charge a particular group, the Blue Jay Health Plan used a rating method known as community rating by class (CRC). Under this rating method, Blue Jay

Options:

A.

was allowed to use no more than four rating classes when determining how much to charge the group for health coverage

B.

was required to make the average premium in each class no more than 105% of the average premium for any other class

C.

divided its members into rating classes based on demographic factors, experience, or industry characteristics, and then charged each member in a rating class the same premium

D.

charged all employers or other group sponsors the same dollar amount for a given level of medical benefits, without adjustments for age, gender, industry, or experience

Question 4

The following statement(s) can correctly be made about the characteristics of reports that should be provided to managers for use in managing a healthcare delivery system:

Options:

A.

Users typically need access to all the raw data used to generate reports

B.

Info

C.

Both A and B

D.

A only

E.

B only

F.

Neither A nor B

Question 5

The process of calculating the appropriate premium to charge purchasers, given the degree of risk represented by the individual or group, the expected costs to deliver medical services, and the expected marketability and competitiveness of the health plan

Options:

A.

financing

B.

rating

C.

underwriting

D.

budgeting

Question 6

Which of the following factors have contributed to the limited popularity of FSAs

Options:

A.

"Use it or lose it" provision

B.

Lack of portability

C.

Only self-employed individuals are eligible for establishing FSAs.

D.

Both A &B

Question 7

The following statements are about accreditation in health plans. Select the answer choice that contains the correct statement.

Options:

A.

Accreditation is typically performed by a panel of physicians and administrators employed by the health plan under evaluation.

B.

All accrediting organizations use the same standards of accreditation.

C.

Results of accreditation evaluations are provided only to state regulatory agencies and are not made available to the general public.

D.

Accreditation demonstrates to an health plan's external customers that the plan meets established standards for quality care.

Question 8

The Titanium Health Plan and a third-party administrator (TPA) have entered into a TPA agreement with regard to the administration of a particular health plan. This agreement complies with all of the provisions of the NAIC TPA Model Law. One of the TPA's

Options:

A.

Hold all funds it receives on behalf of Titanium in trust.

B.

Assume full responsibility for ensuring that the health plan is administered properly

C.

Obtain from the federal government a certificate of authority designating the organization as a TPA.

D.

Assume full responsibility for determining the claim payment procedures for the plan

Question 9

Which out of the three is accomplished through precertification?

Options:

A.

Concurrent review

B.

Retrospective review

C.

Prospective review

Question 10

IROs stands for

Options:

A.

Internal Review Organizations

B.

International review Organizations

C.

Independent review organizations

D.

None of the above

Question 11

Disease management is typically set up as a voluntary outreach and support program for plan members with certain _________ diseases

Options:

A.

Acute

B.

Chronic

C.

None of the above

Question 12

Diabetic patients with high glucose levels requiring stabilization following treatment of an acute attack would best be served in an ___________

Options:

A.

Emergency Department

B.

Urgent Care Centre

C.

Hospice Care

D.

Observation Care Unit

Question 13

Select the correct statement regarding TRICARE Extra plan options to military personnel’s.

Options:

A.

Out of pocket expenses are generally high in tricare extra than TRICARE standard

B.

Enrollment is not necessary to participate in TRICARE Extra

C.

TRICARE Extra provides coordinated care managed by primary care case manager

Question 14

The following statements apply to flexible spending arrangements. Select the answer choice that contains the correct statement.

Options:

A.

FSAs were designed to help increase health insurance coverage among self-employed individuals.

B.

Only employers may contribute funds to FSAs.

C.

The popularity of FSAs has been limited because funds may not be rolled over from year to year.

D.

A popular feature of FSAs is their portability, which allows employees to take the funds with them when they change jobs.

Question 15

Which is an advantage of a for-profit health plan?

Options:

A.

Flexibility in raising capital

B.

Double taxation

C.

Exemption from paying federal income taxes.

D.

None of the above.

Question 16

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

Question 17

In order to measure the expenses of institutional utilization, Holt Health care group uses standard formula to calculate hospital bed stays per 1000 plan members. On 26 November, Holt uses the following information to:

Calculate the bed days per 1000 members for the MTD

Total gross hospital bed days in MTD = 500

Plan membership = 15000

Calculate Holt's number of bed days per 1000 members for the month to date, rounded to the nearest whole number.

Options:

A.

468

B.

365

C.

920

D.

500

Question 18

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.

Question 19

The agreement by two or more independent competitors on the prices or fees that they will charge for services is known as:

Options:

A.

Tying arrangements

B.

Price fixing

C.

Horizontal group boycott

D.

Horizontal division of markets

Question 20

One feature of the Employee Retirement Income Security Act (ERISA) is that it:

Options:

A.

Requires self-funded employee benefit plans to pay premium taxes at the state level.

B.

Contains a pre-emption provision, which typically makes the terms of ERISA take precedence over any state laws that regulate employee welfare benefit plans.

C.

Contains strict reporting and disclosure requirements for all employee benefit plans except health plans.

D.

Requires that state insurance laws apply to all employee benefit plans except insured plans.

Question 21

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

Question 22

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.

Question 23

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

Question 24

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.

Question 25

Managed behavioral health organizations (MBHOs) use several strategies to manage the delivery of behavioral healthcare services. The following statements are about these strategies.

Select the answer choice that contains the correct statement.

Options:

A.

MBHOs generally provide benefits for mental health services but not for chemical dependency services.

B.

The level of care needed to treat behavioral disorders is the same for all patients and all disorders.

C.

By using outpatient treatment more extensively, MBHOs have decreased the use of costly inpatient therapies.

D.

PCP gatekeeper systems for behavioral healthcare generally result in more accurate diagnoses, more effective treatment, and more efficient use of resources than do centralized referral systems.

Question 26

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.

Question 27

Members who qualify to participate in a health plan's case management program are typically assigned a case manager. During the course of the member's treatment, the case manager is responsible for

Options:

A.

Coordinating and monitoring the member's care

B.

Approve

C.

Both A and B

D.

A only

E.

B only

F.

Neither A nor B

Question 28

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 containing the two terms that you have chosen. For providers, (operational /

Options:

A.

operational / an acquisition

B.

operational / a consolidation

C.

structural / an acquisition

D.

structural / a consolidation

Question 29

The following paragraph contains an incomplete statement. Select the answer choice containing the term that correctly completes the statement. In early efforts to manage healthcare costs, traditional indemnity health insurers included in their health pla

Options:

A.

cost shifting

B.

deductibles

C.

underwriting

D.

copy

Question 30

Paul Gilbert has been covered by a group health plan for two years. He has been undergoing treatment for angina for the past three months. Last week, Mr. Gilbert began a new job and immediately enrolled in his new company's group health plan, which has a

Options:

A.

Can exclude coverage for treatment of Mr. Gilbert's angina for one year, because HIPAA does not impact a group health plan's pre-existing condition provision.

B.

Can exclude coverage for treatment of Mr. Gilbert's angina for one year, because Mr. Gilbert did not have at least 36 months of creditable coverage under his previous health plan.

C.

Can exclude coverage for treatment of Mr. Gilbert's angina for three months, because that is the length of time he received treatment for this medical condition prior to his enrollment in the new health plan.

D.

Cannot exclude his angina as a pre-existing condition, because the one-year pre-existing condition provision is offset by at least one year of continuous coverage under his previous health plan.

Question 31

One way in which health plans differ from traditional indemnity plans is that health plans typically

Options:

A.

provide less extensive benefits than those provided under traditional indemnity plans

B.

place a greater emphasis on preventive care than do traditional indemnity plans

C.

require members to pay a percentage of the cost of medical services rendered after a claim is filed, rather than a fixed copayment at the time of service as required by indemnity plans

D.

contain cost-sharing requirements that result in more out-of-pocket spending by members than do the cost-sharing requirements in traditional indemnity plans

Question 32

The following sentence contains an incomplete statement with two missing words. Select the answer choice that contains the words that correctly fill the two blanks, respectively. The philosophy of consumer choice involves having consumers play a(n) ______

Options:

A.

Decreased … Increased

B.

Increased … Decreased

C.

Increased … Increased

D.

Decreased … Decreased

Question 33

The contract between the Honolulu MCO and Beverley Hills Hospital contains a 90 day cure provision. The Beverley Hills Hospital breached one of the contract requirements on July 31, 2004. The hospital remedied the problem by October 31, 2004. Which of the

Options:

A.

The contract would not be terminated as Beverley Hills hospital rectified the problem within 90 days.

B.

The contract would be terminated as Beverley Hills hospital was required to notify Honolulu MCO about the problem at least 90 days in advance.

C.

The contract would be terminated as Beverley Hills hospital was required to rectify the problem within 90 days.

D.

The contract would not be terminated as Beverley Hills hospital may escape adherence to the cure provision.

Question 34

The Advantage Health Plan recently added the following features to its member services program:

1. IVR

2. Active member outreach program

3. Advantage's member services staffing needs are likely to increase as a result of

Options:

A.

1

B.

2

C.

1 & 2

D.

Neither 1 nor 2

Question 35

One distinguishing characteristic of a health maintenance organization (HMO) is that, typically, an HMO

Options:

A.

arranges for the delivery of medical care and provides, or shares in providing, the financing of that care

B.

must be organized on a not-for-profit basis

C.

may be organized as a corporation, a partnership, or any other legal entity

D.

must be federally qualified in order to conduct business in any state

Question 36

One ethical principle in managed care is the principle of justice/equity, which specifically holds that MCOs and their providers have a duty to

Options:

A.

treat each member in a manner that respects his or her own goals and values

B.

allocate resources in a way that fairly distributes benefits and burdens among the members

C.

present information honestly to their members and to honor commitments to their members

D.

make sure they do not harm their members

Question 37

Janet Riva is covered by a traditional indemnity health insurance plan that specifies a $250 deductible and includes a 20% coinsurance provision. When Ms. Riva was hospitalized, she incurred $2,500 in medical expenses that were covered by her health plan.

Options:

A.

$1,750

B.

$1,800

C.

$2,000

D.

$2,250

Question 38

One ethical principle in health plans is the principle of non-malfeasance, which holds that health plans and their providers:

Options:

A.

Should allocate resources in a way that fairly distributes benefits and burdens among the members.

B.

Have a duty to present information honestly and are obligated to honor commitments.

C.

Are obligated not to harm their members.

D.

Should treat each plan member in a manner that respects his or her goals and values.

Question 39

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

Question 40

Health plans can organize under a not-for-profit form or a for-profit form. One true statement regarding not-for-profit health plans is that these organizations typically

Options:

A.

are exempt from review by the Internal Revenue Service (IRS)

B.

are organized as stock companies for greater flexibility in raising capital

C.

rely on income from operations for the large cash outlays needed to fund long-term projects and expansion

D.

engage in lobbying or political activities in order to maintain their tax-exempt status

Question 41

In certain situations, a health plan can use the results of utilization review to intervene, if necessary, to alter the course of a plan member's medical care. Such intervention can be based on the results of

Options:

A.

Prospective review

B.

Concurrent review

C.

D.

A, B, and C

E.

A and B only

F.

A and C only

G.

B only

Question 42

Appropriateness of treatment provided is determined by developing criteria that if unmet will prompt further investigation of a claim which are also called:

Options:

A.

Codes

B.

Lists

C.

Edits

D.

Checks

Question 43

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

Question 44

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

Options:

A.

inability of a proposed insured to share with the insurer the financial risks of healthcare coverage

B.

possibility that a proposed insured will profit from an illness by receiving benefits that exceed the total amount of his or her eligible medical expenses

C.

inability of a proposed insured to provide sufficient evidence that proves he or she is an insurable risk

D.

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

Question 45

Brokers are one type of distribution channel that health plans use to market their health plans. One true statement about brokers for health plan products is that, typically, brokers

Options:

A.

Are not required to be licensed by the states in which they market health plans

B.

Are compensated on a salary basis

C.

Represent only one health plan or insurer

D.

Are considered to be an agent of the buyer rather than an agent of the health plan or Insurer

Question 46

Ashley Martin is covered by a managed healthcare plan that specifies a $300 deductible and includes a 30% coinsurance provision for all healthcare obtained outside the plan’s network of providers. In 1998, Ms. Martin became ill while she was on vacation,

Options:

A.

$300

B.

$510

C.

$600

D.

$810

Question 47

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

Options:

A.

Hospital emergency departments

B.

Physician's offices

C.

Urgent care centers

If these settings are ranked in order of the cost of providing c

D.

A, B, C

E.

A, C, B

F.

B, C, A

G.

C, A, B

Question 48

From the following answer choices, choose the description of the ethical principle that best corresponds to the term Autonomy

Options:

A.

Health plans and their providers are obligated not to harm their members

B.

Health plans and their providers should treat each member in a manner that respects the member's goals and values, and they also have a duty to promote the good of the members as a group

C.

Health plans and their providers should allocate resources in a way that fairly distributes benefits and burdens among the members

D.

Health plans and their providers have a duty to respect the right of their members to make decisions about the course of their lives

Question 49

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.

Question 50

In certain situations, a health plan can use the results of utilization review to intervene, if necessary, to alter the course of a plan member's medical care. Such intervention can be based on the results of

Options:

A.

Prospective review

B.

Concurrent review

C.

D.

A, B, and C

E.

A and B only

F.

A and C only

G.

B only

Question 51

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

Question 52

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

Question 53

During an open enrollment period in 1997, Amy Hadek enrolled through her employer for group health coverage with the Owl Health Plan, a federally qualified HMO. At the time of her enrollment, Ms. Hadek had three pre-existing medical conditions: angina, fo

Options:

A.

the angina, the high blood pressure, and the broken ankle

B.

the angina and the high blood pressure only

C.

none of these conditions

D.

the broken ankle only

Question 54

During the risk assessment process for a traditional indemnity group insurance health plan, group underwriters consider such characteristics as a group’s geographic location, the size and gender mix of the group, and the level of participation in the grou

Options:

A.

Healthcare costs are typically higher in rural areas than in large urban areas.

B.

The morbidity rate for males is higher than the morbidity rate for females.

C.

The larger the group, the more likely it is that the group will experience losses similar to the average rate of loss that was predicted.

D.

All of the above

Question 55

In health plan terminology, demand management, as used by health plans, can best be described as

Options:

A.

an evaluation of the medical necessity, efficiency, and/or appropriateness of healthcare services and treatment plans for a given patient

B.

a series of strategies designed to reduce plan members' needs to utilize healthcare services by encouraging preventive care, wellness, member self-care, and appropriate use of healthcare services

C.

a technique that prevents a provider who is being reimbursed under a fee schedule arrangement from billing a plan member for any fees that exceed the maximum fee reimbursed by the plan

D.

a system of identifying plan members with special healthcare needs, developing a healthcare strategy to meet those needs, and coordinating and monitoring the care

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Total 367 questions