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

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:

The following statements indicate the pricing policies of two health plans that operate in a particular market:

• The Accent Health Plan consistently underprices its product
• The Bolton Health Plan uses extremely strict underwriting practices for the small groups to which it markets its plan

From the following answer choices, select the response that correctly indicates the most likely market effects of the pricing policies used by Accent and Bolton.

The provider contract that Dr. Timothy Meyer, a pediatrician, has with the Cardigan health plan states that Cardigan will compensate him under a capitation arrangement. However, the contract also includes a typical low enrollment guarantee provision. Statements that can correctly be made about this arrangement include that the low enrollment guarantee provision most likely: