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  • Exam Name: Governance and Regulation
  • Last Update: Sep 12, 2025
  • Questions and Answers: 76
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AHM-510 Practice Exam Questions with Answers Governance and Regulation Certification

Question # 6

There are several approaches to the interagency division of responsibility for managed care entity (MCE) oversight. In State M, the state Medicaid agency, the state department of health, and the state insurance department are all responsible for ensuring that quality improvement programs are in place among the same group of MCEs and that these programs meet each agency's rules and regulations for such programs. This information indicates that State M uses the approach known as the

A.

Parallel model

B.

Shared model

C.

Concurrent model

D.

PACE model

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Question # 7

Health plans should monitor changes in the environment and emerging trends, because changes in society will affect the managed care industry. One true statement regarding recent changes in the environment in which health plans operate is that

A.

Women as a group receive more healthcare and interact more often with health plans than do men over the course of a lifetime

B.

The focus of healthcare during the past decade has shifted away from outpatient care to inpatient hospital treatment

C.

The uninsured population in the United States has been decreasing in recent years

D.

The decline in overall inflation in the 1990s failed to slow the growth in healthcare inflation

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Question # 8

In developing its corporate strategies, the Haven Health Plan decided to implement a growth strategy that is focused on increasing the percentage of preventive health office visits from its current plan members. To accomplish this objective, Haven will send a direct mail kit to existing plan members to remind them of the variety of preventive health services that Haven currently offers, including physical exams, cholesterol tests, and mammograms. This information illustrates Haven's use of

A.

An intensive growth strategy known as market penetration

B.

An integrated growth strategy known as product development

C.

An integrated growth strategy known as market development

D.

A diversified growth strategy known as market penetration

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Question # 9

The government uses various tools within the realm of two broad categories of public policy-allocative policies and regulatory policies. In the context of public policy, laws that fall into the category of allocative policy include

A.

The Balanced Budget Act (BBA) of 1997

B.

The Health Insurance Portability and Accountability Act (HIPAA) of 1996

C.

Laws affecting health plan quality oversight

D.

Laws specifying procedures for health plan handling of consumer appeals and grievances

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Question # 10

Nightingale Health Systems, a health plan, operates in a state that requires health plans to allow enrollees to visit obstetricians and gynecologists without a referral from a primary care provider. This information indicates that Nightingale must comply with a type of mandate known as a:

A.

Direct access law

B.

Scope-of-practice law

C.

Provider contracting mandate

D.

Physician incentive law

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Question # 11

In the paragraph below, a statement contains two pairs of terms enclosed in parentheses. Determine which term in each pair correctly completes the statement. Then select the answer choice containing the two terms that you have chosen.

In the case of Pacificare of Oklahoma, Inc. v. Burrage, the U.S. Court of Appeals for the Tenth Circuit considered whether ERISA preempts medical malpractice claims against health plans based on certain liability theories. In this case, the Tenth Circuit court held that ERISA (should / should not) preempt a liability claim against an HMO for the malpractice of one of its primary care physicians, and therefore the HMO was subject to a claim of (subordinated / vicarious) liability.

A.

Should / subordinated

B.

Should / vicarious

C.

Should not / subordinated

D.

Should not / vicarious

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Question # 12

One provision of the Mental Health Parity Act of 1996 (MHPA) is that the MHPA prohibits group health plans from

A.

Setting a cap for a group member's lifetime medical health benefits that is higher than the cap for the member's lifetime mental health benefits

B.

Imposing limits on the number of days or visits for mental health treatment

C.

Charging deductibles for mental health benefits that are higher than the deductibles for medical benefits

D.

Imposing annual limits on the number of outpatient visits and inpatient hospital stays for mental health services

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Question # 13

TRICARE, a military healthcare program, offers eligible beneficiaries three options for healthcare services: TRICARE Prime, TRICARE Extra, and TRICARE Standard. With respect to plan features, both an annual deductible and claims filing requirements must be met, regardless of whether care is delivered by network providers, under

A.

TRICARE Prime and TRICARE Extra only

B.

TRICARE Extra and TRICARE Standard only

C.

TRICARE Standard only

D.

None of these healthcare options

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Question # 14

Determine whether the following statement is true or false:

Although most-favored-nation (MFN) clauses in contracts between health plans and healthcare providers are not per se illegal, they should be reviewed under the rule of reason analysis for antitrust purposes.

A.

True, because the Federal Trade Commission (FTC) ruled that MFN clauses are not per se illegal and the FTC encourages health plans to include them in provider contracts.

B.

True, because although MFN clauses are not per se illegal, they violate antitrust laws if they have a predatory purpose and an anticompetitive effect.

C.

False, because MFN clauses involve decisions by providers concerning the level of fees to charge, and thus they are per se illegal.

D.

False, because MFN clauses are not per se illegal, and thus they are exempt from antitrust laws and regulation by the FTC.

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Question # 15

While traditional workers' compensation laws have restricted the use of managed care techniques, many states now allow managed workers' compensation. One common characteristic of managed workers' compensation plans is that they

A.

Discourage injured employees from returning to work until they are able to assume all the duties of their jobs

B.

Use low copayments to encourage employees to choose preferred providers

C.

Cover an employee's medical costs, but they do not provide coverage for lost wages

D.

Rely on total disability management to control indemnity benefits

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Question # 16

From the following answer choices, choose the term that best corresponds to this description. The SureQual Group is a group of practicing physicians and other healthcare professionals paid by the federal government to review services ordered or furnished by other practitioners in the same medical fields for the purpose of determining whether medical services provided were reasonable and necessary, and to monitor the quality of care given to Medicare patients.

A.

Health insuring organization (HIO)

B.

Independent practice association (IPA)

C.

Physician practice management (PPM) company

D.

Peer review organization (PRO)

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Question # 17

In the paragraph below, a statement contains two pairs of terms enclosed in parentheses. Determine which term in each pair correctly completes the statement. Then select the answer choice containing the two terms that you have chosen.

Every employee benefit plan governed by the Employee Retirement Income Security Act (ERISA) must distribute a summary plan description (SPD) to participants within (90 / 120) days after the date on which the plan is adopted or made effective. Thereafter, if the plan is amended, a new SPD must be distributed every (5 / 10) years.

A.

90 / 5

B.

90 / 10

C.

120 / 5

D.

120 / 10

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Question # 18

After conducting a business portfolio analysis, the Acorn Health Plan decided to pursue a harvest strategy with one of its strategic business units (SBUs)-Guest Behavioral Healthcare. By following a harvest strategy with Guest, Acorn most likely is seeking to

A.

Maximize Guest's short-term earnings and cash flow

B.

Increase Guest's market share

C.

Maintain Guest's market position

D.

Sacrifice immediate earnings in order to fund Guest's growth

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Question # 19

One typical difference between a for-profit health plan's board of directors and a not-for-profit health plan's board of directors is that the directors in a for-profit health plan

A.

Can serve on the board for a period of no more than ten years, whereas the terms of service for a not-for-profit board's directors are usually unlimited by the director's age or by a preset maximum number of years of service

B.

Must participate in raising capital for the health plan, whereas a not-for-profit board's directors are prohibited from participating directly in raising capital for the health plan

C.

Are directly accountable to shareholders, whereas a not-for-profit board's directors are accountable to plan members and the community

D.

Are not compensated for board participation, whereas a not-for-profit board's directors are compensated for board participation

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Question # 20

The Tidewater Life and Health Insurance Company is owned by its policy owners, who are entitled to certain rights as owners of the company, and it issues both participating and nonparticipating insurance policies. Tidewater is considering converting to the type of company that is owned by individuals who purchase shares of the company's stock. Tidewater is incorporated under the laws of Illinois, but it conducts business in the Canadian provinces of Ontario and Manitoba.

Tidewater established the Diversified Corporation, which then acquired various subsidiary firms that produce unrelated products and services. Tidewater remains an independent corporation and continues to own Diversified and the subsidiaries. In order to create and maintain a common vision and goals among the subsidiaries, the management of Diversified makes decisions about strategic planning and budgeting for each of the businesses.

In order to become the type of company that is owned by people who purchase shares of the company's stock, Tidewater must undergo a process known as

A.

management buy-out

B.

piercing the corporate veil

C.

demutualization

D.

mutualization

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Question # 21

The following statements are about the Federal Employees Health Benefits Program (FEHBP), which is administered by the Office of Personnel Management (OPM). Three of the statements are true and one statement is false. Select the answer choice that contains the FALSE statement.

A.

For every plan in the FEHBP, OPM annually determines the lowest premium that is actuarially sound and then negotiates with each plan to establish that premium rate.

B.

Once a health plan has submitted its rate proposals for a contract year to the OPM, it cannot adjust its premium rate for any reason.

C.

To cover its administrative costs, OPM sets aside 1% of all FEHBP premiums.

D.

Each spring, OPM sends all plan providers its call letter, a document that specifies the kinds of benefits that must be available to plan participants and cost goals and procedural changes that the plans need to adopt.

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Question # 22

The following statements describe various state benefit mandates. Select the answer choice that describes a state law pertaining to off-label uses for drugs.

A.

State A mandates that health plans provide benefits for experimental drugs for the treatment of terminal diseases such as AIDS and cancer.

B.

State B mandates that health plans have a procedure in place to allow a patient to have a non-formulary drug covered under certain conditions.

C.

State C mandates that, in dispensing generic drugs, pharmacies must label drug containers with the name of the substituted generic medication.

D.

State D mandates that health plans provide benefits for the treatment of one form of cancer with specific drugs that had originally been approved by the Food and Drug Administration (FDA) to treat other forms of cancer.

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