HSA 408 Final Exam--Ch. 8-14 With
Complete Solutions
From a traditional economic perspective, insurance exists because of what two basic
concepts? - ANSWER -Risk
-Uncertainty.
There is ____________ whether an expensive and unforeseen event that impacts their
health status may occur. - ANSWER -Uncertainty
There is ___________ financial exposure due to the unexpected event. - ANSWER -Risk.
True or False:
Insurance companies are concerned about uncertainty and risk because they are
businesses that need to cover the cost of their expenditures. - ANSWER -True.
___________ and ___________ may lead to adverse selection. For example: unhealthy
people over-select a particular plan, making the plan more expensive. - ANSWER
Uncertainty and Risk
Describe Beneficiary. - ANSWER -Consumer; the individual who is covered by the plan.
Define Premium. - ANSWER -Annual fee paid by the beneficiary to the health plan,
usually in monthly installments, to secure health insurance coverage.
Define Deductible. - ANSWER -Amount of money a beneficiary must pay out-of-pocket
before the insurance company assists with paying for services.
Describe Cost-Sharing. - ANSWER -Copayment or Co-insurance, an amount the
,beneficiary pays per service after the deductible is met.
Describe Experience Rating. - ANSWER -based on health status & claims in prior year(s)
-also referred to as medical underwriting.
-this comes into play when setting premiums.
Describe Community Rating. - ANSWER -based on factors unrelated to previous use of
medical care, such as geography or age.
-all persons in the community rating system pay the same amount.
Describe the incentives under the Fee-For-Service Insurance arrangement. - ANSWER
--Does not create incentives for providers or patients to utilize healthcare sparingly.
-Providers have an incentive to provide more services and more expensive services (but
not necessarily higher-quality services) b/c their income r uses with each procedure or
office visit and fees are higher for more expensive services.
Describe Managed Care. - ANSWER -integrates the provision and payment of healthcare
services.
-contains costs while providing necessary & high-quality healthcare services.
What are the Managed Care Cost Containment Tools? - ANSWER -Performance-based
salary.
-Discounted fee schedule.
-Capitated payment.
Describe the Performance-based salary managed care cost containment tool. -
ANSWER -Provider receives a salary as a managed care organization employee.
Describe the Discounted fee schedule managed care cost containment tool. - ANSWER
-Provider accepts less than fee-for-service rates to participate in managed care
network.
, Describe the Capitated payment managed care cost containment tool. - ANSWER
-Provider receives a per member/per month payment for all services rendered within
scope of practice.
What are the Managed Care Utilization Control Tools? - ANSWER -Gatekeeper
-Utilization Review.
-Case Management.
Describe the GateKeeper--Managed Care Utilization Control Tool. - ANSWER -Managed
care organization uses a primary care provider to make sure only necessary and
appropriate care is provided.
Describe the Utilization Review--Managed Care Utilization Control Tool. - ANSWER
-Managed care organization reviews and approves or denies services requested by
provider.
Describe the Case Management--Managed Care Utilization Control Tool. - ANSWER
-Managed care organization manages and coordinates patient care.
What are the Managed Care Common Structures? - ANSWER -Health Maintenance
Organization (HMO).
-Preferred Provider Organization (PPO).
-Point of Service Plans (POS).
Describe the Health Maintenance Organization (HMO) Managed Care Utilization Control
Tools. - ANSWER -Pays providers salary or capitation.
-Beneficiaries may only use in-network providers.
-Coordinates & controls receipt of services.
Describe the Preferred Provider Organization (PPO) Managed Care Utilization Control
Complete Solutions
From a traditional economic perspective, insurance exists because of what two basic
concepts? - ANSWER -Risk
-Uncertainty.
There is ____________ whether an expensive and unforeseen event that impacts their
health status may occur. - ANSWER -Uncertainty
There is ___________ financial exposure due to the unexpected event. - ANSWER -Risk.
True or False:
Insurance companies are concerned about uncertainty and risk because they are
businesses that need to cover the cost of their expenditures. - ANSWER -True.
___________ and ___________ may lead to adverse selection. For example: unhealthy
people over-select a particular plan, making the plan more expensive. - ANSWER
Uncertainty and Risk
Describe Beneficiary. - ANSWER -Consumer; the individual who is covered by the plan.
Define Premium. - ANSWER -Annual fee paid by the beneficiary to the health plan,
usually in monthly installments, to secure health insurance coverage.
Define Deductible. - ANSWER -Amount of money a beneficiary must pay out-of-pocket
before the insurance company assists with paying for services.
Describe Cost-Sharing. - ANSWER -Copayment or Co-insurance, an amount the
,beneficiary pays per service after the deductible is met.
Describe Experience Rating. - ANSWER -based on health status & claims in prior year(s)
-also referred to as medical underwriting.
-this comes into play when setting premiums.
Describe Community Rating. - ANSWER -based on factors unrelated to previous use of
medical care, such as geography or age.
-all persons in the community rating system pay the same amount.
Describe the incentives under the Fee-For-Service Insurance arrangement. - ANSWER
--Does not create incentives for providers or patients to utilize healthcare sparingly.
-Providers have an incentive to provide more services and more expensive services (but
not necessarily higher-quality services) b/c their income r uses with each procedure or
office visit and fees are higher for more expensive services.
Describe Managed Care. - ANSWER -integrates the provision and payment of healthcare
services.
-contains costs while providing necessary & high-quality healthcare services.
What are the Managed Care Cost Containment Tools? - ANSWER -Performance-based
salary.
-Discounted fee schedule.
-Capitated payment.
Describe the Performance-based salary managed care cost containment tool. -
ANSWER -Provider receives a salary as a managed care organization employee.
Describe the Discounted fee schedule managed care cost containment tool. - ANSWER
-Provider accepts less than fee-for-service rates to participate in managed care
network.
, Describe the Capitated payment managed care cost containment tool. - ANSWER
-Provider receives a per member/per month payment for all services rendered within
scope of practice.
What are the Managed Care Utilization Control Tools? - ANSWER -Gatekeeper
-Utilization Review.
-Case Management.
Describe the GateKeeper--Managed Care Utilization Control Tool. - ANSWER -Managed
care organization uses a primary care provider to make sure only necessary and
appropriate care is provided.
Describe the Utilization Review--Managed Care Utilization Control Tool. - ANSWER
-Managed care organization reviews and approves or denies services requested by
provider.
Describe the Case Management--Managed Care Utilization Control Tool. - ANSWER
-Managed care organization manages and coordinates patient care.
What are the Managed Care Common Structures? - ANSWER -Health Maintenance
Organization (HMO).
-Preferred Provider Organization (PPO).
-Point of Service Plans (POS).
Describe the Health Maintenance Organization (HMO) Managed Care Utilization Control
Tools. - ANSWER -Pays providers salary or capitation.
-Beneficiaries may only use in-network providers.
-Coordinates & controls receipt of services.
Describe the Preferred Provider Organization (PPO) Managed Care Utilization Control
