AHIP 2027 — Modules 1–5 Exam
Preparation Guide
Module 1: Medicare Basics
Questions 1–20
1. Which part of Medicare primarily covers inpatient hospital services?
A. Part A B. Part B C. Part C only D. Part D
Correct answer: A. Part A
Rationale: Medicare Part A generally covers eligible inpatient hospital care, skilled
nursing facility care under qualifying conditions, hospice, and certain home health
services. It does not provide general outpatient prescription drug coverage.
2. Which Medicare part primarily covers physician services and outpatient medical
care?
A. Part A B. Part B C. Part D D. Medigap
Correct answer: B. Part B
Rationale: Part B covers medically necessary physician services, outpatient care,
many preventive services, and eligible durable medical equipment. Beneficiaries
generally pay a premium and may have deductibles and coinsurance.
3. What is Medicare Part C?
A. A federal prescription discount card B. Medicare Supplement insurance C.
Medicare Advantage D. Medicaid
Correct answer: C. Medicare Advantage
Rationale: Medicare Advantage plans are offered by Medicare-approved private
organizations as an alternative way to receive Medicare Part A and Part B benefits.
Most plans also include Part D coverage.
4. Which part of Medicare provides outpatient prescription drug coverage?
A. Part A B. Part B exclusively C. Part C exclusively D. Part D
Correct answer: D. Part D
,Rationale: Part D helps cover eligible outpatient prescription medications through
stand-alone prescription drug plans or Medicare Advantage plans that include drug
coverage.
5. Who is generally eligible for Medicare based on age?
A. Anyone aged 55 B. Anyone aged 60 C. Most people aged 65 or older who meet
applicable eligibility requirements D. Anyone aged 50 who purchases private
insurance
Correct answer: C. Most people aged 65 or older who meet applicable eligibility
requirements
Rationale: Age 65 is the usual age-based eligibility threshold. Citizenship or lawful-
residency rules and other eligibility requirements apply. Certain younger people may
qualify through disability or specific medical conditions.
6. Which statement about Original Medicare is correct?
A. It consists of Parts A and B. B. It always includes Part D. C. It always limits
members to one private insurer's network. D. It automatically includes every Medigap
benefit.
Correct answer: A. It consists of Parts A and B.
Rationale: Original Medicare is the traditional federal fee-for-service program.
Prescription drug coverage and Medigap are separate choices, subject to eligibility
and enrollment rules.
7. What is a Medicare deductible?
A. A payment made to an insurance salesperson B. An amount a beneficiary must pay
for covered services before the applicable coverage begins paying under the plan's
rules C. A penalty applied to every beneficiary D. The same thing as a monthly
premium
Correct answer: B. An amount a beneficiary must pay for covered services before the
applicable coverage begins paying under the plan's rules
Rationale: A deductible is different from a premium, copayment, and coinsurance.
The precise application depends on the Medicare coverage and benefit involved.
8. What is a Medicare premium?
A. A monthly or other periodic amount paid to maintain coverage B. A hospital's
diagnosis code C. A prescription's retail price D. A guaranteed reimbursement for
every medical service
Correct answer: A. A monthly or other periodic amount paid to maintain coverage
, Rationale: Premiums are payments for insurance coverage. Some people qualify for
assistance with certain Medicare premiums, while others pay the applicable amounts
themselves.
9. What does coinsurance generally mean?
A. A fixed payment for every service B. A percentage of the cost of a covered service
C. A late enrollment notice D. A premium refund
Correct answer: B. A percentage of the cost of a covered service
Rationale: Coinsurance is usually expressed as a percentage. A copayment, by
contrast, is generally a specified dollar amount.
10. Which statement best describes a Medicare Advantage plan's provider network?
A. Every plan must cover routine care from every provider at the same in-network
cost. B. Network rules may determine where members receive routine covered
services and what they pay. C. Networks apply only to prescription drugs. D.
Networks eliminate all beneficiary cost-sharing.
Correct answer: B. Network rules may determine where members receive routine
covered services and what they pay.
Rationale: HMO and PPO plans have different network and out-of-network rules.
Emergency and urgent-care protections also apply under Medicare requirements.
11. What is Medigap designed to do?
A. Replace Medicare eligibility B. Help pay certain out-of-pocket costs associated
with Original Medicare C. Replace every prescription drug plan D. Provide Medicare
Part A eligibility to everyone
Correct answer: B. Help pay certain out-of-pocket costs associated with Original
Medicare
Rationale: Medigap is Medicare Supplement insurance. It generally works with
Original Medicare and ordinarily cannot be used to pay Medicare Advantage plan
cost-sharing.
12. Which statement about long-term custodial care is correct?
A. Original Medicare covers unlimited custodial nursing-home care. B. Part D covers
all nursing-home room and board. C. Original Medicare generally does not cover
long-term custodial care when that is the only care needed. D. Every Medicare
Advantage plan must pay for unlimited custodial care.
Correct answer: C. Original Medicare generally does not cover long-term custodial
care when that is the only care needed.
Preparation Guide
Module 1: Medicare Basics
Questions 1–20
1. Which part of Medicare primarily covers inpatient hospital services?
A. Part A B. Part B C. Part C only D. Part D
Correct answer: A. Part A
Rationale: Medicare Part A generally covers eligible inpatient hospital care, skilled
nursing facility care under qualifying conditions, hospice, and certain home health
services. It does not provide general outpatient prescription drug coverage.
2. Which Medicare part primarily covers physician services and outpatient medical
care?
A. Part A B. Part B C. Part D D. Medigap
Correct answer: B. Part B
Rationale: Part B covers medically necessary physician services, outpatient care,
many preventive services, and eligible durable medical equipment. Beneficiaries
generally pay a premium and may have deductibles and coinsurance.
3. What is Medicare Part C?
A. A federal prescription discount card B. Medicare Supplement insurance C.
Medicare Advantage D. Medicaid
Correct answer: C. Medicare Advantage
Rationale: Medicare Advantage plans are offered by Medicare-approved private
organizations as an alternative way to receive Medicare Part A and Part B benefits.
Most plans also include Part D coverage.
4. Which part of Medicare provides outpatient prescription drug coverage?
A. Part A B. Part B exclusively C. Part C exclusively D. Part D
Correct answer: D. Part D
,Rationale: Part D helps cover eligible outpatient prescription medications through
stand-alone prescription drug plans or Medicare Advantage plans that include drug
coverage.
5. Who is generally eligible for Medicare based on age?
A. Anyone aged 55 B. Anyone aged 60 C. Most people aged 65 or older who meet
applicable eligibility requirements D. Anyone aged 50 who purchases private
insurance
Correct answer: C. Most people aged 65 or older who meet applicable eligibility
requirements
Rationale: Age 65 is the usual age-based eligibility threshold. Citizenship or lawful-
residency rules and other eligibility requirements apply. Certain younger people may
qualify through disability or specific medical conditions.
6. Which statement about Original Medicare is correct?
A. It consists of Parts A and B. B. It always includes Part D. C. It always limits
members to one private insurer's network. D. It automatically includes every Medigap
benefit.
Correct answer: A. It consists of Parts A and B.
Rationale: Original Medicare is the traditional federal fee-for-service program.
Prescription drug coverage and Medigap are separate choices, subject to eligibility
and enrollment rules.
7. What is a Medicare deductible?
A. A payment made to an insurance salesperson B. An amount a beneficiary must pay
for covered services before the applicable coverage begins paying under the plan's
rules C. A penalty applied to every beneficiary D. The same thing as a monthly
premium
Correct answer: B. An amount a beneficiary must pay for covered services before the
applicable coverage begins paying under the plan's rules
Rationale: A deductible is different from a premium, copayment, and coinsurance.
The precise application depends on the Medicare coverage and benefit involved.
8. What is a Medicare premium?
A. A monthly or other periodic amount paid to maintain coverage B. A hospital's
diagnosis code C. A prescription's retail price D. A guaranteed reimbursement for
every medical service
Correct answer: A. A monthly or other periodic amount paid to maintain coverage
, Rationale: Premiums are payments for insurance coverage. Some people qualify for
assistance with certain Medicare premiums, while others pay the applicable amounts
themselves.
9. What does coinsurance generally mean?
A. A fixed payment for every service B. A percentage of the cost of a covered service
C. A late enrollment notice D. A premium refund
Correct answer: B. A percentage of the cost of a covered service
Rationale: Coinsurance is usually expressed as a percentage. A copayment, by
contrast, is generally a specified dollar amount.
10. Which statement best describes a Medicare Advantage plan's provider network?
A. Every plan must cover routine care from every provider at the same in-network
cost. B. Network rules may determine where members receive routine covered
services and what they pay. C. Networks apply only to prescription drugs. D.
Networks eliminate all beneficiary cost-sharing.
Correct answer: B. Network rules may determine where members receive routine
covered services and what they pay.
Rationale: HMO and PPO plans have different network and out-of-network rules.
Emergency and urgent-care protections also apply under Medicare requirements.
11. What is Medigap designed to do?
A. Replace Medicare eligibility B. Help pay certain out-of-pocket costs associated
with Original Medicare C. Replace every prescription drug plan D. Provide Medicare
Part A eligibility to everyone
Correct answer: B. Help pay certain out-of-pocket costs associated with Original
Medicare
Rationale: Medigap is Medicare Supplement insurance. It generally works with
Original Medicare and ordinarily cannot be used to pay Medicare Advantage plan
cost-sharing.
12. Which statement about long-term custodial care is correct?
A. Original Medicare covers unlimited custodial nursing-home care. B. Part D covers
all nursing-home room and board. C. Original Medicare generally does not cover
long-term custodial care when that is the only care needed. D. Every Medicare
Advantage plan must pay for unlimited custodial care.
Correct answer: C. Original Medicare generally does not cover long-term custodial
care when that is the only care needed.
