AHM-520 Exam Dumps : Health Plan Finance and Risk Management

This concept, which holds that a company should record the amounts associated with its business transactions in monetary terms, assumes that the value of money is stable over time. This concept provides objectivity and reliability, although its relevance may fluctuate.

From the following answer choices, choose the name of the accounting concept that matches the description.

The Savanna health plan used a risk analysis technique which defines the key assumptions of Savanna's strategic financial plan in terms of mathematical formulas that can be correlated to each other or analyzed independently. This technique allowed Savanna to simulate probable future events on a computer and produce a distribution of possible outcomes. This risk analysis technique, which can be used to predict Savanna's distribution of expected claims, is known as

The following information relates to the Hardcastle Health Plan for the month of June:

• Incurred claims (paid and IBNR) equal $100,000
• Earned premiums equal $120,000
• Paid claims, excluding IBNR, equal $80,000
• Total health plan expenses equal $300,000

This information indicates that Hardcastle’s medical loss ratio (MLR) for the month of June was approximately equal to: