A Review Of Validated AHM-510 Exam Question

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NEW QUESTION 1
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 detecting violations of law. SoundCare decided to remedy this weakness by using the 1991 Federal
Sentencing Guidelines for Organizations as a model for its compliance program.
By definition, the activity that SoundCare conducted when it examined its strengths, weaknesses, and capabilities is known as

  • A. An environmental analysis
  • B. An internal assessment
  • C. An environmental forecast
  • D. A community analysis

Answer: B

NEW QUESTION 2
Health plans are allowed to appeal rules or regulations that affect them. Generally, the grounds for such appeals are limited either to procedural grounds or jurisdictional grounds. The Kabyle Health Plan appealed the following new regulations:
Appeal 1 - Kabyle objected to this regulation on the ground that this regulation is inconsistent with the law.
Appeal 2 - Kabyle objected to this regulation because it believed that the subject matter was outside the realm of issues that are legal for inclusion in the regulatory agency's regulations. Appeal 3 - Kabyle objected to the process by which this regulation was adopted.
Of these appeals, the ones that Kabyle appealed on jurisdictional grounds were

  • A. Appeals 1, 2, and 3
  • B. Appeals 1 and 2 only
  • C. Appeals 1 and 3 only
  • D. Appeals 2 and 3 only

Answer: B

NEW QUESTION 3
The Sawgrass Health Center is an institution that trains healthcare professionals and performs various clinical and other types of healthcare-related research. Because Sawgrass receives government funding, it is required to provide medical care for the poor. Of the following types of health plans, Sawgrass can best be described as:

  • A. A medical foundation
  • B. An academic medical center (AMC)
  • C. A healthcare cooperative
  • D. A community health center (CHC)

Answer: B

NEW QUESTION 4
The Balanced Budget Act (BBA) of 1997 created the Medicare+Choice plan. One provision of the BBA under Medicare+Choice is that the BBA

  • A. Requires health plans to qualify as either a competitive medical plan (CMP) or a federally qualified HMO in order to participate in the Medicare program
  • B. Eliminates funding for demonstration projects such as the Medicare Enrollment Demonstration Project
  • C. Narrows the geographic variations in payments to Medicare health plans by lowering the growth rate of payments in high-payment counties and raising the rates in low-payment counties
  • D. Increases Graduate Medical Education (GME) payments to hospitals for the training and cost of educating and training residents

Answer: C

NEW QUESTION 5
Any willing provider laws have their share of proponents and opponents. Arguments commonly made in opposition to any willing provider laws include

  • A. That such laws reduce the number of providers in a health plan's network
  • B. That such laws limit consumer choice to coverage options that are more costly than networkbased plans
  • C. That such laws encourage providers to offer discounts in exchange for patient volume
  • D. All of the above

Answer: B

NEW QUESTION 6
The following answer choices describe various approaches that a health plan can take to voice its opinions on legislation. Select the answer choice that best describes a health plan's use of grassroots lobbying.

  • A. The Delancey Health Plan is launching a media campaign in an effort to persuade the public that proposed health care legislation will increase the cost of healthcare.
  • B. The Stellar Health Plan is using direct mail and telephone calls to encourage people who support a patient rights bill to contact key legislators and voice their support for the bill.
  • C. The Bestway Health Plan is encouraging its employees to contribute to a political action committee (PAC) that is funding the political campaign of a pro-health plan candidate.
  • D. A representative of the Palmer Health Plan is attending a one-on-one meeting with a legislator to present Palmer's position on pending managed care legislation.

Answer: B

NEW QUESTION 7
The Surrey Medical Supply Company was formed as a limited partnership. In this partnership, Victoria Lewin is one of the limited partners and Oscar Gould is a general partner. This information indicates that, with respect to the typical characteristics of limited partnerships,

  • A. M
  • B. Lewin has more freedom to opt out of the partnership than does M
  • C. Gould
  • D. M
  • E. Lewin has more liability for the debts of Surrey than does M
  • F. Gould
  • G. both M
  • H. Lewin and M
  • I. Gould participate in the day-to-day management of Surrey
  • J. the partnership will continue upon the death of M
  • K. Gould, whereas it will end with the death of M
  • L. Lewin

Answer: A

NEW QUESTION 8
Solvency standards for Medicare provider-sponsored organizations (PSOs) are divided into three parts: (1) the initial stage, (2) the ongoing stage, and (3) insolvency. In the initial stage, prior to CMS approval, a Medicare PSO typically must have a minimum net worth of

  • A. $750,000
  • B. $1,000,000
  • C. $1,500,000
  • D. $2,000,000

Answer: C

NEW QUESTION 9
The government uses various tools within the realm of two broad categories of public policyallocative policies and regulatory policies. In the context of public policy, laws that fall into the
category of allocative policy include

  • A. The Balanced Budget Act (BBA) of 1997
  • B. The Health Insurance Portability and Accountability Act (HIPAA) of 1996
  • C. Laws affecting health plan quality oversight
  • D. Laws specifying procedures for health plan handling of consumer appeals and grievances

Answer: A

NEW QUESTION 10
The board of directors of the Garnet Health Plan, an integrated delivery system (IDS), includes
physicians and hospital representatives who sometimes feel compelled to represent a specific organization that is only one part of the IDS. Such a circumstance can lead to , which is a situation in which the members of the board focus on the best interests of component parts of the enterprise rather than on the best interests of Garnet as a whole.

  • A. An enterprise-focused board
  • B. Representational governance
  • C. Enterprise liability
  • D. Boundary spanning

Answer: B

NEW QUESTION 11
Determine whether the following statement is true or false:
Failing to adopt and implement standards for the prompt investigation and settlement of claims is an example of an activity that would be considered an improper claims practice according to the NAIC Model Unfair Claims Settlement Practices Act.

  • A. True
  • B. False

Answer: A

NEW QUESTION 12
A federal law that significantly affects health plans is the Health Insurance Portability and Accountability Act of 1996 (HIPAA). In order to comply with HIPAA provisions, issuers offering group health coverage generally must.

  • A. Renew group health policies in both small and large group markets, regardless of the health status of any group member
  • B. Provide a plan member with a certificate of creditable coverage at the time the member enrolls in the group plan
  • C. Both A and B
  • D. A only
  • E. B only
  • F. Neither A nor B

Answer: B

NEW QUESTION 13
One federal law amended the Social Security Act to allow states to set their own qualification standards for HMOs that contracted with state Medicaid programs and revised the requirement that participating HMOs have an enrollment mix of no more than 50% combined Medicare and Medicaid members.
This act, which was the true stimulus for increasing participation by health plans in Medicaid, is called the

  • A. Omnibus Budget Reconciliation Act of 1981 (OBRA-81)
  • B. Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA)
  • C. Employee Retirement Income Security Act of 1974 (ERISA)
  • D. Federal Employees Health Benefits Act of 1958 (FEHB Act)

Answer: A

NEW QUESTION 14
While traditional workers' compensation laws have restricted the use of managed care techniques, many states now allow managed workers' compensation. One common characteristic of managed workers' compensation plans is that they

  • A. Discourage injured employees from returning to work until they are able to assume all the duties of their jobs
  • B. Use low copayments to encourage employees to choose preferred providers
  • C. Cover an employee's medical costs, but they do not provide coverage for lost wages
  • D. Rely on total disability management to control indemnity benefits

Answer: D

NEW QUESTION 15
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

NEW QUESTION 16
From the following answer choices, choose the term that best corresponds to this description. The
SureQual Group is a group of practicing physicians and other healthcare professionals paid by the federal government to review services ordered or furnished by other practitioners in the same medical fields for the purpose of determining whether medical services provided were reasonable and necessary, and to monitor the quality of care given to Medicare patients.

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

Answer: D

NEW QUESTION 17
The Good & Well Pharmacy, a Medicaid provider of outpatient drugs, is subject to the prospective drug utilization review (DUR) mandates of the Omnibus Budget Reconciliation Act of 1990 (OBRA '90). One component of prospective DUR is screening. In this context, when Good & Well is involved in the process of screening, the pharmacy is

  • A. Updating a formulary to represent the current clinical judgment of providers and experts in the diagnosis and treatment of disease
  • B. Reviewing patient profiles for the purpose of identifying potential problems
  • C. Consulting directly with prescribers and patients in the planning of drug therapy
  • D. Denying coverage for the off-label use of approved drugs

Answer: B

NEW QUESTION 18
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.
Every employee benefit plan governed by the Employee Retirement Income Security Act (ERISA) must distribute a summary plan description (SPD) to participants within (90 / 120) days after the date on which the plan is adopted or made effective. Thereafter, if the plan is amended, a new SPD must be distributed every (5 / 10) years.

  • A. 90 / 5
  • B. 90 / 10
  • C. 120 / 5
  • D. 120 / 10

Answer: C

NEW QUESTION 19
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

NEW QUESTION 20
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

NEW QUESTION 21
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