CPHRM Final Practice Examination – Full-Length
Healthcare Risk Management Certification Exam
Preparation
1. A surgeon performs a procedure on the wrong limb of a patient despite a ‘time-out’ being
conducted. What is the risk manager’s immediate priority following this sentinel event?
A. Ensuring the patient’s immediate clinical needs are met and the site is stabilized.
B. Conducting a formal Root Cause Analysis (RCA) within 45 days.
C. Notifying the state Department of Health and The Joint Commission.
D. Suspending the surgeon’s clinical privileges pending an investigation.
Correct Answer: A
Explanation: The immediate priority in any adverse event is the clinical safety and
stabilization of the patient to prevent further harm. While RCA and regulatory reporting
are mandatory, they follow the acute management of the clinical situation. Professionals
must remember that the primary goal of risk management is patient safety, and failure to
stabilize the patient first is a common trap in management-focused exam questions.
2. An organization is transitioning from a siloed risk management approach to Enterprise Risk
Management (ERM). Which of the following best describes the ‘Strategic’ domain of risk in an
ERM framework?
A. Risks related to the daily operation of the facility, including staffing levels.
B. Risks associated with the organization’s ability to maintain its brand and market share.
,C. Risks involving the management of capital, budget variances, and credit.
D. Risks regarding the compliance with federal and state healthcare regulations.
Correct Answer: B
Explanation: The Strategic domain in ERM focuses on the organization’s ability to grow
and remain viable, which includes reputation, brand, and competitive positioning. This
differs from the Operational domain, which covers day-to-day functions, or the Financial
domain, which covers capital and credit. Understanding these domains is essential for
CPHRM candidates to move beyond clinical risk and into organizational leadership roles.
3. A patient presents to the Emergency Department (ED) with symptoms of a stroke. The
facility lacks a neurologist on call. Under EMTALA, what must the hospital do before
transferring the patient to a primary stroke center?
A. Obtain prior authorization from the patient’s insurance provider.
B. Wait for the patient to sign a waiver releasing the hospital of liability.
C. Provide a medical screening exam (MSE) and stabilizing treatment within its capabilities.
D. Transfer the patient immediately without treatment to avoid delay.
Correct Answer: C
Explanation: EMTALA requires that any individual who comes to the ED must receive a
Medical Screening Exam (MSE) to determine if an emergency medical condition exists. If it
does, the hospital must provide stabilizing treatment within its capacity before an
,appropriate transfer can occur. A common pitfall is assuming that a lack of specialty
equipment allows for an immediate transfer without any screening or stabilization efforts.
4. A Risk Manager receives a Summons and Complaint naming the hospital in a malpractice
suit regarding a birth injury. What is the most critical first step in the claims management
process?
A. Contacting the involved clinicians to discuss their defense strategy.
B. Notifying the professional liability insurance carrier and legal counsel.
C. Reviewing the medical record and making necessary corrections for clarity.
D. Issuing a press release to manage the organization’s public reputation.
Correct Answer: B
Explanation: Timely notification of the insurance carrier is crucial to trigger coverage and
meet policy requirements for defense. Once legal counsel is involved, the risk manager can
coordinate the preservation of evidence and the investigation under attorney-client
privilege. Correcting medical records post-incident (Option C) is highly illegal and is a
major pitfall that can lead to charges of spoliation of evidence.
5. A healthcare facility utilizes a ‘claims-made’ professional liability policy. If the policy is
canceled, what must the organization purchase to ensure coverage for incidents that
occurred during the policy period but have not yet been reported?
A. Occurrence-based rider
B. Self-insured retention (SIR) extension
, C. Nose coverage (Prior Acts)
D. Tail coverage (Extended Reporting Period)
Correct Answer: D
Explanation: Tail coverage, or an Extended Reporting Period, is necessary when a claims-
made policy is terminated to cover claims that are filed after the policy ends for incidents
that happened while it was active. Nose coverage is purchased from a new carrier to cover
past events, while tail coverage is purchased from the old carrier. Understanding the
difference between claims-made and occurrence policies is a fundamental requirement for
risk financing in the CPHRM exam.
6. A risk manager is leading a Failure Mode and Effects Analysis (FMEA) on the medication
administration process. What is the primary purpose of an FMEA?
A. To proactively identify and mitigate potential failures in a process before they occur.
B. To investigate a specific medication error that resulted in patient death.
C. To assign blame to specific departments for systemic inefficiencies.
D. To comply with state reporting requirements for adverse drug events.
Correct Answer: A
Explanation: FMEA is a prospective, proactive risk assessment tool used to identify where
a process might fail and what the effects would be. Unlike Root Cause Analysis (RCA),
which is reactive and looks at what happened, FMEA looks at what could happen.
Healthcare Risk Management Certification Exam
Preparation
1. A surgeon performs a procedure on the wrong limb of a patient despite a ‘time-out’ being
conducted. What is the risk manager’s immediate priority following this sentinel event?
A. Ensuring the patient’s immediate clinical needs are met and the site is stabilized.
B. Conducting a formal Root Cause Analysis (RCA) within 45 days.
C. Notifying the state Department of Health and The Joint Commission.
D. Suspending the surgeon’s clinical privileges pending an investigation.
Correct Answer: A
Explanation: The immediate priority in any adverse event is the clinical safety and
stabilization of the patient to prevent further harm. While RCA and regulatory reporting
are mandatory, they follow the acute management of the clinical situation. Professionals
must remember that the primary goal of risk management is patient safety, and failure to
stabilize the patient first is a common trap in management-focused exam questions.
2. An organization is transitioning from a siloed risk management approach to Enterprise Risk
Management (ERM). Which of the following best describes the ‘Strategic’ domain of risk in an
ERM framework?
A. Risks related to the daily operation of the facility, including staffing levels.
B. Risks associated with the organization’s ability to maintain its brand and market share.
,C. Risks involving the management of capital, budget variances, and credit.
D. Risks regarding the compliance with federal and state healthcare regulations.
Correct Answer: B
Explanation: The Strategic domain in ERM focuses on the organization’s ability to grow
and remain viable, which includes reputation, brand, and competitive positioning. This
differs from the Operational domain, which covers day-to-day functions, or the Financial
domain, which covers capital and credit. Understanding these domains is essential for
CPHRM candidates to move beyond clinical risk and into organizational leadership roles.
3. A patient presents to the Emergency Department (ED) with symptoms of a stroke. The
facility lacks a neurologist on call. Under EMTALA, what must the hospital do before
transferring the patient to a primary stroke center?
A. Obtain prior authorization from the patient’s insurance provider.
B. Wait for the patient to sign a waiver releasing the hospital of liability.
C. Provide a medical screening exam (MSE) and stabilizing treatment within its capabilities.
D. Transfer the patient immediately without treatment to avoid delay.
Correct Answer: C
Explanation: EMTALA requires that any individual who comes to the ED must receive a
Medical Screening Exam (MSE) to determine if an emergency medical condition exists. If it
does, the hospital must provide stabilizing treatment within its capacity before an
,appropriate transfer can occur. A common pitfall is assuming that a lack of specialty
equipment allows for an immediate transfer without any screening or stabilization efforts.
4. A Risk Manager receives a Summons and Complaint naming the hospital in a malpractice
suit regarding a birth injury. What is the most critical first step in the claims management
process?
A. Contacting the involved clinicians to discuss their defense strategy.
B. Notifying the professional liability insurance carrier and legal counsel.
C. Reviewing the medical record and making necessary corrections for clarity.
D. Issuing a press release to manage the organization’s public reputation.
Correct Answer: B
Explanation: Timely notification of the insurance carrier is crucial to trigger coverage and
meet policy requirements for defense. Once legal counsel is involved, the risk manager can
coordinate the preservation of evidence and the investigation under attorney-client
privilege. Correcting medical records post-incident (Option C) is highly illegal and is a
major pitfall that can lead to charges of spoliation of evidence.
5. A healthcare facility utilizes a ‘claims-made’ professional liability policy. If the policy is
canceled, what must the organization purchase to ensure coverage for incidents that
occurred during the policy period but have not yet been reported?
A. Occurrence-based rider
B. Self-insured retention (SIR) extension
, C. Nose coverage (Prior Acts)
D. Tail coverage (Extended Reporting Period)
Correct Answer: D
Explanation: Tail coverage, or an Extended Reporting Period, is necessary when a claims-
made policy is terminated to cover claims that are filed after the policy ends for incidents
that happened while it was active. Nose coverage is purchased from a new carrier to cover
past events, while tail coverage is purchased from the old carrier. Understanding the
difference between claims-made and occurrence policies is a fundamental requirement for
risk financing in the CPHRM exam.
6. A risk manager is leading a Failure Mode and Effects Analysis (FMEA) on the medication
administration process. What is the primary purpose of an FMEA?
A. To proactively identify and mitigate potential failures in a process before they occur.
B. To investigate a specific medication error that resulted in patient death.
C. To assign blame to specific departments for systemic inefficiencies.
D. To comply with state reporting requirements for adverse drug events.
Correct Answer: A
Explanation: FMEA is a prospective, proactive risk assessment tool used to identify where
a process might fail and what the effects would be. Unlike Root Cause Analysis (RCA),
which is reactive and looks at what happened, FMEA looks at what could happen.
