Exam 3: Health Plan Finance and Risk Management

The following paragraph contains an incomplete statement. Select the answer choice containing the term that correctly completes the statement. Health plans face four contingency risks (C-risks): asset risk (C-1), pricing risk (C-2), interest-rate risk (C-3), and general management risk (C-4). Of these risks, ________________ is typically the most important risk that health plans face. This is true because a sizable portion of the total expenses and liabilities faced by a health plan come from contractual obligations to pay for future medical costs, and the exact amount of these costs is not known when the healthcare coverage is priced.

The following statements are about various reimbursement arrangements that health plans have with hospitals. Select the answer choice containing the correct statement.

Col. Martin Avery, on active duty in the U.S. Army, is eligible to receive healthcare benefits under one of the three TRICARE health plan options. If Col Avery elects to participate in TRICARE Prime, he will be:

A public employer, such as a municipality or county government would be considered which of the following?

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

Reconciliation is the process by which a health plan assesses providers' performance relative to contractual terms and reimbursement. With regard to this process, it can correctly be stated that

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

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 as

The following statements indicate the pricing policies of two health plans that operate in a particular market: The Accent Health Plan consistently underprices its product The Bolton Health Plan uses extremely strict underwriting practices for the small groups to which it markets its plan From the following answer choices, select the response that correctly indicates the most likely market effects of the pricing policies used by Accent and Bolton.

The Eclipse Health Plan is a not-for-profit health plan that qualifies under the Internal Revenue Code for tax-exempt status. This information indicates that Eclipse

Ed Murray is a claims analyst for a managed care plan that provides a higher level of benefits for services received in-network than for services received out-of-network. Whenever Mr. Murray receives a health claim from a plan member, he reviews the claim

The following statements are about a health plan's pricing of a preferred provider organization (PPO) plan. Three of the statements are true, and one statement is false. Select the answer choice containing the FALSE statement.

Consumer-directed health plans are not a new concept. They actually got their start in the late 1970s with the advent of:

All CDHP products provide federal tax advantages while allowing consumers to save money for their healthcare.

Amendments to the HMO act 1973 do not permit federally qualified HMO's to use

The Cardinal health plan complies with all of the provisions of HIPAA. Cardinal has received requests for healthcare coverage from the following companies that meet the statutory definition of a small group: The Xavier Company has excellent claims experience The Youngblood Company has not previously offered group healthcare coverage to its employees The Zebulon Company has poor claims experience According to HIPAA's provisions, Cardinal must issue a healthcare contract to

The Atoll Health Plan must comply with a number of laws that directly affect the plan's contracts. One of these laws allows Atoll's plan members to receive medical services from certain specialists without first being referred to those specialists by a primary care provider (PCP). This law, which reduces the PCP's ability to manage utilization of these specialists, is known as _________.

The Violin Company offers its employees a triple option of health plans: an HMO, an HMO with a point of service (POS) option, and an indemnity plan. Premiums are lowest for the HMO option and highest for the indemnity plan. Violin employees who anticipate that they will be individual low utilizes of healthcare services are most likely to enroll in the

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 _____________.

A health savings account must be coupled with an HDHP that meets federal requirements for minimum deductible and maximum out-of-pocket expenses. Dollar amounts are indexed annually for inflation. For 2006, the annual deductible for self-only coverage must