AHIP AHM-520 FAHM Exam Practice Test Instant Access

Question 1

Dr. Martin Cassini is an obstetrician who is under contract with the Bellerby Health Plan. Bellerby compensates Dr. Cassini for each obstetrical patient he sees in the form of a single amount that covers the costs of prenatal visits, the delivery itself, and post-delivery care . This information indicates that Dr. Cassini is compensated under the provider reimbursement method known as a:

Aglobal fee

Brelative value scale

Cunbundling

Ddiscounted fee-for-service

Answer : A

Question 2

For this question, select the answer choice containing the terms that correctly complete blanks A and B in the paragraph below. The FASB mandates that accounting information must exhibit certain qualitative characteristics. One of these characteristics is ________A________, which means that a company's financial statements use the same accounting policies and procedures from one accounting period to the next, unless there is a sound reason for changing a policy or procedure. Another characteristic is _________B________, which requires a company to disclose in its financial statements all significant financial information about the company.

AA = reliability
B = comparability

BA = reliability
B = materiality

CA = consistency
B = comparability

DA = consistency
B = materiality

Answer : D

Question 3

The Nuevo health plan's capital structure consists of 30% debt and 70% equity. Nuevo's average after-tax cost of debt is 6% and its cost of equity is 12%. The following statement(s) can correctly be made about Nuevo's weighted average cost of capital (WACC):

A) Nuevo has a WACC of 10.2%

B) If Nuevo establishes its WACC as the handle rate for capital investments, then it can expect an investment to add value to the health plan only if the investment is expected to earn a return of less than Nuevo's WACC

ABoth A and B

BA only

CB only

DNeither A nor B

Answer : B

Question 4

The Acorn Health Plan uses a resource-based relative value scale (RBRVS) to help determine the reimbursement amounts that Acorn should make to providers who are compensated under an FFS system. With regard to the advantages and disadvantages to Acorn of using RBRVS, it can correctly be stated that

AAn advantage of using RBRVS is that it can assist Acorn in developing reimbursement schedules for various types of providers in a comprehensive healthcare plan

BAn advantage of using RBRVS is that it puts providers who render more medical services than necessary at financial risk for this overutilization

CA disadvantage of using RBRVS is that it will be difficult for Acorn to track treatment rates for the health plan's quality and cost management functions

DA disadvantage of using RBRVS is that it rewards procedural healthcare services more than cognitive healthcare services

Answer : A

Question 5

The following statements are about the new methodology authorized under the Balanced Budget Act of 1997 (BBA) for payments by the Centers for Medicaid & Medicare Services (CMS) to Medicare-contracting health plans.

Select the answer choice containing the correct statement.

AUnder this new methodology, Medicare-contracting health plans are paid the lower of (a) a floor payment amount per enrollee covered or (b) the health plan's payment rate increased by 2% from the previous year.

BThe new methodology has decreased the rate of growth in payments from CMS to Medicare-contracting health plans.

CUnder this new methodology, Medicare-contracting health plans are paid 90% of the adjusted average per capita cost (AAPCC) of providing a service to a beneficiary.

DUnder the principal inpatient diagnostic cost group (PIP-DCG), a new risk adjustment methodology, Medicare-contracting health plans will no longer be required to calculate and submit to CMS a Medicare adjusted community rate (ACR).

Answer : B

Question 6

Two sets of financial accounting standards are generally accepted accounting principles (GAAP) and statutory accounting practices (SAP). One true statement about these financial accounting standards is that

AState laws and regulations in the United States govern the implementation of GAAP, but not the implementation of SAP

BHealth plans must prepare their financial statements for their external users according to applicable laws, regulations, and accounting principles, particularly GAAP

CGAAP specifically focuses on the requirements of insurance regulators and policyholder interests

DThe Financial Accounting Standards Board (FASB) is a private organization whose purpose is to establish and promote SAP in the United States

Answer : B

Question 7

One difference between the internal and external analysis of a health plan's financial information is that

AInternal analysis of the health plan can be more detailed and more specific than can external analysis

BInternal analysts are more likely than external analysts to want comparative financial data about the health plan

COnly internal analysts use trend analysis to analyze the health plan's financial statements

DOnly internal analysts typically conduct the financial analysis of the health plan themselves

Answer : A

AHIP Health Plan Finance and Risk Management AHM-520 FAHM Exam Practice Test