Governance and Regulation v4.0 (AHM-510)

Page:    1 / 6   
Total 80 questions

The Westchester Health Plan is using a pricing strategy that involves setting a low price in a highly price-sensitive market to stimulate revenue growth. In following this strategy,
Westchester is sacrificing short-term profits for fast growth in selected markets. This information indicates that Westchester is following the pricing strategy known as

  • A. Market skimming
  • B. Buying market share
  • C. Price skimming
  • D. Unitary pricing


Answer : B

The Opal Health Plan complies with all of the provisions of the Newborns' and Mothers'
Health Protection Act of 1996 (NMHPA). Samantha Hill and Debra Chao are Opal enrollees. Ms. Hill was hospitalized for a cesarean birth, and Ms. Chao was hospitalized for a normal delivery. From the following answer choices, select the response that indicates the minimum hospital stay for which Opal, under NMHPA, must provide benefits for Ms. Hill and Ms. Chao.

  • A. Ms. Hill: 72 hours; Ms. Chao: 24 hours
  • B. Ms. Hill: 72 hours; Ms. Chao: 48 hours
  • C. Ms. Hill: 96 hours; Ms. Chao: 24 hours
  • D. Ms. Hill: 96 hours; Ms. Chao: 48 hours


Answer : D

The Wentworth Corporation uses a self-funded plan to provide its employees with healthcare benefits. One consequence of Wentworth's approach to providing healthcare benefits is that self-funding

  • A. Requires that Wentworth self-administer its healthcare benefit plan
  • B. Requires that Wentworth pay higher state premium taxes than do insurers and health plans
  • C. Eliminates the need for Wentworth to pay a risk charge to an insurer or health plan
  • D. Increases the number of benefit and rating mandates that apply to Wentworth's plan


Answer : C

States may impose nominal deductibles, coinsurance, or copayments on some Medicaid recipients for certain services. Services for which states can require copayments from
Medicaid recipients include:

  • A. Emergency services
  • B. Family planning services
  • C. Both A and B
  • D. A only
  • E. B only
  • F. Neither A nor B


Answer : D

The following statements are about market conduct examinations of health plans. Select the answer choice that contains the correct statement.

  • A. Multistate examinations are not appropriate for financial examinations, because regulatory requirements concerning a health plan's financial condition tend to vary from state to state.
  • B. Market conduct examinations of a health plan's advertising and sales materials include comparing the advertising materials to the policies they advertise.
  • C. Once an examination report is provided to the state insurance department, a health plan is not given an opportunity to present a formal objection to the report.
  • D. In imposing sanctions on health plans, state insurance departments are required to follow federal sentencing guidelines.


Answer : B

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.

  • A. True, because the Federal Trade Commission (FTC) ruled that MFN clauses are not per se illegal and the FTC encourages health plans to include them in provider contracts.
  • B. True, because although MFN clauses are not per se illegal, they violate antitrust laws if they have a predatory purpose and an anticompetitive effect.
  • C. False, because MFN clauses involve decisions by providers concerning the level of fees to charge, and thus they are per se illegal.
  • D. False, because MFN clauses are not per se illegal, and thus they are exempt from antitrust laws and regulation by the FTC.


Answer : B

Brighton Health Systems, Inc., a health plan, wants to modify its advertising and marketing materials to avoid liability risk under the principle of ostensible agency. One step that
Brighton can take to reduce the likelihood of being liable for provider negligence under the theory of ostensible agency is to

  • A. Guarantee the quality of medical care provided to Brighton members
  • B. Use advertising materials which state that Brighton itself provides healthcare
  • C. Add disclaimers to advertising materials indicating that only physicians and not Brighton make medical decisions
  • D. Use advertising materials to characterize Brighton's role as providing physicians, hospitals, and other healthcare professionals rather than arranging for healthcare.


Answer : C

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 detectingviolations of law. SoundCare decided to remedy this weakness by using the 1991 Federal Sentencing Guidelines for Organizations as a model for its compliance program.
With respect to the Federal Sentencing Guidelines, actions that SoundCare should take in developing its compliance program include

  • A. Creating a system through which employees and other agents can report suspected misconduct without fear of retribution
  • B. Holding management accountable for the misconduct of their subordinates
  • C. Assigning a high-level member of management to the position of compliance coordinator or administrator
  • D. All of the above


Answer : D

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 ofreason to analyze joint pricing activities by competitors in physician or multiprovider networks only if

  • A. Provider integration under the network is likely to produce significant efficiencies that benefit consumers
  • B. The providers in a network share substantial financial risk
  • C. The combining of providers into a joint venture enables the providers to offer a new product
  • D. All of the above


Answer : A

From the following answer choices, choose the term that best corresponds to this description.
Barrington Health Services, Inc. contracts with a state Medicaid agency as a fiscal intermediary. Barrington does not provide medical services, but contracts with medical providers on behalf of the state Medicaid agency.

  • A. Health insuring organization (HIO)
  • B. Independent practice association (IPA)
  • C. Physician practice management (PPM) company
  • D. Peer review organization (PRO)


Answer : A

Regulatory and legislative bodies are among the important environmental forces in the health plan industry. The following statements are about such regulation and legislation.
Select the answer choice that contains the correct statement.

  • A. Federal guidelines exist to direct health plans on compliance issues when a health plan encounters conflicting state laws in a given service area.
  • B. Administrative rules and regulations do not carry the force of law.
  • C. As stakeholders in the health plan industry, federal and state governments exert tremendous influence over a health plan's formation and operations.
  • D. In recent years, the number of health plan bills in the state and the federal legislatures has decreased.


Answer : C

Health plans typically divide their costs into medical and administrative expenses.
Examples of medical expenses are.

  • A. Equipment costs
  • B. Salaries and benefits for executives and for all functional areas
  • C. Sales and marketing costs
  • D. Payments to providers for the delivery of healthcare


Answer : D

Directors on a health plan's board must demonstrate their compliance with three duties in all their decisions. Directors who exercise their duties in good faith and with the same degree of diligence and skill that an ordinary, reasonable person would be expected to display in the same situation are meeting the duty known as the

  • A. Duty of loyalty
  • B. Duty to supervise
  • C. Duty of care
  • D. Trustee duty


Answer : C

In 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.
In the case of Pacificare of Oklahoma, Inc. v. Burrage, the U.S. Court of Appeals for the
Tenth Circuit considered whether ERISA preempts medical malpractice claims against health plans based on certain liability theories. In this case, the Tenth Circuit court held that
ERISA (should / should not) preempt a liability claim against an HMO for the malpractice of one of its primary care physicians, and therefore the HMO was subject to a claim of
(subordinated / vicarious) liability.

  • A. Should / subordinated
  • B. Should / vicarious
  • C. Should not / subordinated
  • D. Should not / vicarious


Answer : D

Congress enacted three clauses relating to the preemptive effect of the Employee
Retirement Income Security Act of 1974 (ERISA). One of these clauses preserves from
ERISA preemption any state law that regulates insurance, banking, or securities, with the exception of the exemption for self-funded employee benefit plans. This clause is called the

  • A. Savings clause
  • B. Preemption clause
  • C. Deemer clause
  • D. De novo clause


Answer : A

Explanation: The savings clause preserves from preemption any state law that regulates insurance, banking or securities except as provided by the deemer clause.

Page:    1 / 6   
Total 80 questions