Chapter 12

In what year was the Social Security Act of 1935 amended to create Medicare and Medicaid?

1965 Rationale: The Social Security Act of 1935 was amended to create Medicare and Medicaid in 1965. This provided indemnity insurance for individuals over 65 years old and created a source of funding for the poor and disabled. In 1956, the act was amended to establish the Disability Insurance (DI) program. In 1975, legislation went into effect that determined benefits would rise in accordance with the rise of cost-of-living. In 1983, major legislation was passed that restored solvency to the Old Age and Survivors Insurance and Disability Insurance program.

What is healthcare rationing?

A concept in which healthcare goods and services are directed to where they can do the most good Rationale: Healthcare rationing is best described as determining the most appropriate use of health care or directing the health care where it can do the most good. Healthcare rationing does not refer to a payment plan, a public program, or a belief that goods and services should not be used unless necessary.

A patient needs a primary care provider (PCP) referral to see a rheumatologist as prescribed during a recent inpatient stay. Which cost containment strategy is this an example of?

Access limitation Rationale:In access limitation, the enrollee must choose a PCP and consult this provider for a referral before seeking specialty services. Rationing is when the most appropriate use of health care is determined and directed where it can do the most good. In peer review, physicians and other medical personnel review hospital records and counsel the attending physician about unnecessary or excessively lengthy hospital stays and unwarranted services. Capitated reimbursement sets a maximum reimbursement amount that healthcare providers will receive for the provision of care, regardless of what the actual costs are.

Which will the nurse include in diagnosis related groups (DRGs) documentation for Medicare that is needed to determine provider payment? Select all that apply.

Age Gender Diagnoses Complications Rationale: Provider reimbursement is determined according to the client's age, gender, primary and secondary diagnoses, and complications. Medicare depends on the DRG to calculate the amount to be paid to the provider. Preventive care status and number of prescriptions are not considered when calculating DRGs.

The nurse is explaining Medicare fraud to a patient. Which examples could the nurse provide to illustrate fraud? Select all that apply.

Billing Medicare for services not received Use of another's Medicare card to obtain services Billing Medicare for services other than those received Rationale: Examples of Medicare fraud include billing Medicare for services not received, using someone else's Medicare card to obtain services, and billing Medicare for services other than those received. Employing an after-hours call service, advising a patient to go to the emergency room, and scheduling a patient's annual physical for the next year at the end of the current year's examination are not examples of Medicare fraud.

Which practice is reflected when the physician's office receives a maximum reimbursement amount for the provision of care, regardless of the actual cost of the care?

Capitated reimbursement Rationale: Capitated reimbursement is the maximum reimbursement amount that the healthcare provider will receive for the provision of care, regardless of the actual cost. The capitated (or maximum) payment for services is determined by statistical norms, practice parameters, and population data. Rationing refers to determining the appropriate use of health care or directing the health care where it can do the most good. In cost sharing, employees pay more to increase the covered services not provided by the basic plan. Access limitation refers to the necessity of gatekeeper approval to access some services.

Which is a payment mechanism that pays healthcare providers a fixed amount per enrollee to cover a defined set of services over a specified period, regardless of actual services provided?

Capitation Rationale: Capitation is a payment mechanism that pays healthcare providers a fixed amount per enrollee to cover a defined set of services over a specified period, regardless of actual services provided. Capital costs are depreciation, interest, leases and rentals, taxes, and insurance on tangible assets. Full capitation is a stipulated dollar amount established to cover the cost of all healthcare services delivered to a person. A customary charge is a physician payment based on the median charge for a given service within a 12-month period.

A patient is responsible for 20% of the cost of specialist office visits. Which term defines this 20% fee?

Coinsurance Rationale: Coinsurance is cost sharing required by a health plan whereby the individual is responsible for a net percentage of the charge for each service. The premium is the amount paid periodically to purchase health insurance benefits. The deductible is cost sharing whereby the individual pays a specified amount before the health plan pays for a covered service. Copayment is a form of cost sharing whereby the individual pays a specified fixed dollar amount for each service.

Which health promotion and disease prevention initiatives are mandated by the Affordable Care Act? Select all that apply.

Counseling for prevention of sexually transmitted diseases Counseling for management of obesity Tobacco cessation Rationale: Tobacco cessation, screening for alcohol use, and counseling for the prevention of sexually transmitted disease are initiatives mandated by the Affordable Care Act. Screening for alcohol use and enrollment in an exercise program for certain individuals are not mandated by the ACA.

At the federal level, which department administers funding for health promotion and disease-preventive measures via "health-specific" grants?

Department of Health and Human Services Rationale: At the national level, the U.S. Department of Health and Human Services administers funding for health promotion and disease-preventive measures through "health-specific" grants. The Department of State, Department of Justice, and Department of Veterans Affairs do not provide funding for health promotion and disease-preventive measures.

Which changes have contributed to the increase in healthcare costs? Select all that apply.

Drug utilization Aging of society Technological advances Previously unhealthy lifestyles Rationale: Costs of prescription drugs have risen dramatically and have become a significant part of health expenditures in the past several decades. As people live longer, the percentage of those older than 85 years is also increasing. Therefore the number of people consuming the greatest amount of healthcare resources will rise more rapidly than the number who provide the monetary support for these resources. Technological advances have the potential to save many lives but can be very expensive. Although significant lifestyle changes have been adopted by many people in the past 30 years, many patients utilizing the healthcare system today may have health conditions that are in part caused by, or worsened by, many years of living an unhealthy lifestyle. The shift was not to nonprofit health care but from nonprofit health care to for-profit health care. This shift placed an emphasis on profit and mechanisms for achieving higher reimbursement that have in turn affected healthcare costs.

Which changes to private insurance occurred as a result of the Affordable Care Act (ACA)? Select all that apply.

Established a process for reviewing increases in health plan premiums and requiring justification of increases. Established a temporary national high-risk pool to provide health coverage to individuals with preexisting medical conditions. Rationale: The ACA established a process for reviewing increases in health plan premiums, required justification of those increases, and established a temporary high-risk pool to provide health coverage to individuals with preexisting medical conditions. The ACA permits states to form healthcare choice compacts and allows insurers to sell policies in any state participating in those compacts. The ACA prohibits health plans from placing lifetime limits on the dollar amount of coverage or rescinding coverage. In fact, for all individual and group policies the ACA provides dependent coverage for children up to age 26 years. The change in coverage for this age group accounted for about 40% of the overall decline in the number of uninsured Americans.

Which interventions were created to reduce unnecessary utilization of health care? Select all that apply.

Establishment of a "gatekeeper" Limited patient provider choice Limited coverage for preexisting conditions Exclusion of participants with exorbitant use Requirement of preauthorization for some services Rationale: Restrictions on use of health care, such as the establishment of a "gatekeeper," limited patient provider choice, requirement of preauthorization for some services, limited coverage for preexisting illnesses, and exclusion of those participants whose use was deemed exorbitant were instituted in an attempt to reduce unnecessary utilization. Reimbursement with multiple insurers does not reduce unnecessary utilization; expenses for health care in America vary according to types of care and sources of funding because of reimbursement with multiple insurers.

Which program allows citizens to collect a percentage of recovered funds if fraudulent Medicare claims are reported and monies are collected as a result?

False Claims Act Amendments of 1986 Rationale: The False Claims Act Amendments of 1986 allow private citizens to collect a percentage of recovered funds if they report fraudulent Medicare claims and monies are collected as a result. The Medicare Integrity Program, Fraud and Abuse Control Program, and Health Care Fraud and Abuse Data Collection Program are provided by the Health Insurance Portability and Accountability Act (HIPAA). These programs do not allow receipts to collect a percentage of recovered funds.

How did implementation of the prospective payment system (PPS) affect overall healthcare costs?

Had no effect Rationale: Implementation of the PPS led to a reduction in Medicare costs but did not result in overall healthcare cost savings as expected. This outcome came as the result of hospitals including losses accrued by caring for Medicare patients in their charges when they submitted charges to private insurance companies.

Why might a patient with insurance still have difficulty with access to care?

Healthcare providers might not accept certain types of insurance. Rationale: It is not enough for a person to have health insurance because healthcare providers decide whether they will accept a given type of insurance. This can limit access to healthcare services. People can receive services that are covered by their insurance company regardless of age. Health insurance provides coverage all the time, not part of the time, although coverage may be partial. People with health insurance are not less likely to receive urgent care.

How is the aging population a factor that affects access to care? Select all that apply.

Healthcare services could cost more, meaning fewer people would be able to afford them. There may not be enough providers and nurses to meet the needs of all patients. Rationale: An aging population means that more people require more medical services for longer amounts of time. This can negatively affect access to care because there might not be enough providers and nurses to meet the needs of the patients. Patients may have to wait longer for their appointments and procedures because providers will become busier. Healthcare services could also cost more as a result of the aging population because individuals will require more medical services, procedures, and prescriptions, which will put more strain on the country's healthcare budget. If services become more expensive, this could affect accessibility. The cost of healthcare services will not decline for those who are over 65 years of age. The aging population will not affect a person's willingness to travel to and from appointments. The aging population will not require providers and nurses to go back to school to study gerontology.

What is the disadvantage for patients using point-of-service plans to obtain health care?

High copayment for out-of-plan services Rationale: The disadvantage for patients using point-of-care service to obtain health care is the high copayment for out-of-plan services. It is also necessary to get a primary care referral for specialized services, making it difficult for some patients under this plan to obtain the care they need because of time and cost restraints. Patients covered with an indemnity plan pay high premiums. There is no incentive for cost containment when obtaining health care by fee for service. The disadvantage for patients who are insured under a health maintenance organization (HMO) or preferred provider organization (PPO) is the potential for a lower quality of care to maximize costs.

The patient has a health savings account (HSA). Which type of insurance reimbursement plan offered by employers often includes HSAs?

High-deductible health plan Rationale: Many high-deductible health plans offer health savings accounts (HSA). HSAs are tax-free contributions employees make to help cover healthcare expenses. Fee for service, point of service, and HMO insurance reimbursement plans are not likely to be paired with a health savings account.

Which mandated services are covered by Medicaid for eligible recipients? Select all that apply.

Home health care Rural health clinic services Laboratory and radiography services Rationale: For eligible recipients, the federally mandated services covered by Medicaid include home health care, rural health clinic services, and laboratory and radiography services. Optional services that states may elect to provide include hospice, rehabilitation, and optometrist services.

What services make up the largest portion of healthcare expenditures in the United States?

Hospital care services - 32%

A patient is confused by employer-offered Health Savings Accounts (HSA) and Flexible Spending Accounts (FSA). Which information can the nurse provide about these arrangements? Select all that apply.

If the employee overestimates the cost of an FSA, the remaining amount is forfeited at the end of the year. With both the FSA and the HSA, the employee will need to determine how much he or she will have to spend for uncovered services Rationale: If the employee overestimates the cost of an FSA, the remaining amount will be forfeited at the end of the year. With both an FSA and the HSA, the employee determines how much he or she will spend for uncovered services. Money for both HSAs and FSAs is not taxed. The contributions are considered "pretax." HSAs are associated with high-deductible health plans. FSAs are not. Money put into both an FSA and an HSA is deducted from the employee's paychecks.

How does the Affordable Care Act (ACA) reduce fraud and abuse in public programs? Select all that apply.

Increases funding for antifraud activities Increases penalties for submitting false claims Requires Medicare and Medicaid program providers and suppliers to establish compliance programs Requires Medicare and Medicaid program providers to develop a database to share fraud and abuse information among federal and state programs Rationale: The ACA reduces fraud and abuse in public programs by increasing funding for antifraud activities, increasing penalties for submitting false claims, requires Medicare and Medicaid program providers and suppliers to establish compliance programs, and requires Medicare and Medicaid program providers to develop a database to share fraud and abuse information among federal and state programs. The False Claims Act Amendments of 1986 allows private citizens to collect a percentage of recovered funds if they report fraudulent Medicare claims and monies are recovered as a result, not the ACA.

Which type of healthcare plan pays all costs of covered services provided to the enrollee, allowing the enrollee free choice of provider and services, preserving the enrollee's right of choice with personal management of health care?

Indemnity Plan Rationale: Indemnity plans pay all costs of covered services provided to the enrollee, allow the enrollee to enjoy free choice of provider and services, and preserve the enrollee's right of choice to manage his or her own health care. A point-of-service plan covers care within the individual's network. A preferred provider organization negotiates with healthcare providers for services at a reduced rate in exchange for a guaranteed increase in consumers. In a health maintenance organization, preventive care is covered and encouraged, but specialty care can be more restricted.

Which type of insurance costs the most for employers?

Indemnity plan Rationale: Indemnity plans pay costs for all covered services provided to the enrollee. The enrollee also enjoys free choice of provider and services. Indemnity plans are very costly because there is no incentive for cost containment. Therefore they are rarely used today. High-deductible plans, PPOs, and HMOs are less expensive for the employer compared with indemnity plans.

The nurse is reviewing services covered by Medicare Part A with a patient. Which services should the nurse include? Select all that apply.

Inpatient care in hospitals Inpatient care in skilled nursing facilities Rationale: Medicare Part A covers inpatient care in hospitals and skilled nursing facilities. Medicare Part B covers hospital outpatient care and some home health care. Long-term care and care delivered in unskilled facilities are not covered by Medicare Part A.

The nurse is on a team that tracks administrative costs for a health insurance company. Which costs are included in the administrative costs incurred by insurers? Select all that apply.

Marketing Utilization review Premium collection Agents' commissions Medical underwriting Rationale: Administrative costs incurred by insurers include marketing, utilization review, premium collection, agents' commissions, and medical underwriting. New employee orientation is not a part of administrative costs.

Which statements are true of healthcare alliances? Select all that apply.

Medicare is currently participating in healthcare alliances. They help consumers choose among competing insurers and plans. They define basic benefits that all insurers would have to offer to everyone at the same price. The consumer's choice is based on published, simple, standard information about benefits and outcomes Rationale: Medicare is currently participating in healthcare alliances and offers enrollees a choice of traditional Medicare, Medicare parts A and B, or Medicare Advantage. Alliances help consumers choose among competing insurers and plans. Alliances outline basic benefits that all insurers must offer at the same price to all consumers, regardless of health status. The consumer's choice is based on published, simple, standard information about the benefits and outcomes of each available plan. It is not true that alliances would regulate insurance prices. One of the roles of the alliances would be to collect premiums.

Which essential benefits are covered under the Affordable Care Act? Select all that apply.

Mental health Preventive care Ambulatory care Emergency services Rationale: Essential benefits covered under the Affordable Care Act include mental health, preventive care, ambulatory care, and emergency services. Long-term care and cosmetic surgery are not considered essential health benefits under the Affordable Care Act.

A patient is asking the nurse about Medicare Advantage plans. Which statements can the nurse accurately make regarding these Medicare plans? Select all that apply.

Most Medicare Advantage plans include prescription drug coverage. Medicare Advantage Plans must cover all of the services that Original Medicare covers. Most Medicare Advantage plans offer extra services like vision, hearing, dental, and/or health and wellness programs. Medicare Advantage plans are provided by private insurance companies that are approved by and under contract with Medicare. Rationale: Most Medicare Advantage Plans include Medicare prescription drug coverage (part D). Medicare Advantage plans must cover all services covered by Original Medicare. Original Medicare will still cover the cost for hospice care, some new Medicare benefits, and some costs for clinical research studies. Most Medicare Advantage plans offer extra services such as vision, hearing, dental, and/or health and wellness programs. Medicare Advantage plans are provided by private insurance companies that are approved by and under contract with Medicare and may include health maintenance organizations (HMOs) and preferred provider organizations (PPOs). A beneficiary with only Medicare Part A would not be eligible for a Medicare Advantage Plan; beneficiaries must have Medicare Parts A and B.

Which statements are true regarding Medicare Part D? Select all that apply.

Most participants pay a monthly premium, a yearly deductible, and copayments. Depending on the plan selected and the drugs used, subscribers might have additional out-of-pocket costs. The "donut hole" refers to the fact that enrollees must pay for their prescriptions once the total costs reach a given amount in a year. When the enrollee's out-of-pocket total for drugs reaches a particular level, Medicare will pay 95% of the costs of any further prescription drugs. Rationale: Most participants in Medicare Part D pay a monthly premium, a yearly deductible, and copayments, with out-of-pocket costs based on the plan selected and the drugs used. Enrollees are responsible for the cost of prescription drugs once the total costs reach a certain amount in a given year. This amount can vary and is referred to as the "donut hole." Once the enrollee's out-of-pocket costs reach a certain level, Medicare will pay 95% of the costs of any additional prescription drugs. Beneficiaries with Medicare Part A are not automatically enrolled in Part D. Medicare Part D is optional. If eligible Medicare recipients choose this option, they must enroll in an approved prescription drug plan. There is an annual limit on the total costs of drugs covered in a given year. Once this limit is reached, the beneficiary is in what is referred to as the "donut hole" and is responsible for the full cost of medications.

Which statements are true of preferred provider organizations (PPOs)? Select all that apply.

PPOs evolved from the independent practice model to compete with HMOs. The covered individuals must use in-network providers to receive full benefits. PPOs negotiate with healthcare providers for services at a reduced rate in exchange for a guaranteed increase in consumers. Rationale: In an effort to compete with the HMOs, physicians and hospitals organized the independent practice model that was a separate entity that provided services to enrollees of one insurance company. This model evolved into what is referred to as PPO plans. PPOs are more flexible than HMOs, but covered individuals must use network providers to receive full benefits. PPOs negotiate with healthcare providers for services at a reduced rate in exchange for a guaranteed increase in consumers. PPOs are not less expensive than HMOs. In fact, they can be more expensive than HMO plans. PPOs receive a specific amount of reimbursement, regardless of the rendered services, that gives providers the incentive to be more conscious of how much the services provided cost.

Which part of Medicare was created in 2003 to help alleviate the costs of prescriptions for seniors?

Part D Rationale: Medicare Part D is a prescription drug supplement provided through private insurance companies that have contracts with the government. All Medicare recipients are eligible to purchase insurance coverage to offset the costs of prescription drugs. Part A is part of the original government-run Medicare program. It includes coverage for inpatient care, some home health care, and hospice. Part B is also part of the original Medicare program and helps cover costs for doctor's services, testing, outpatient care, home health services, durable medical equipment, and some preventive services. Medicare Part C policies allow private health insurance companies to provide Medicare benefits. These policies are known as Medicare Advantage plans and may include vision, hearing, and dental care, and other services and supplies not covered by Medicare Parts A, B, and D.

A patient is required to designate an in-network physician as the primary health care provider (PCP). Unless he or she is referred by the PCP, the patient will be responsible for most of the costs if he or she goes outside the network of care. Which type of insurance does this patient have?

Point-of-service (POS) Rationale: The patient most likely has a point-of-service plan that combines elements of HMOs and PPOs. With an indemnity plan, the enrollee enjoys free choice of providers and services. PPOs are more flexible than HMOs, but to receive full benefits, the covered individual must use in-network providers. HMOs lack freedom of choice and only the most necessary services are provided.

The nurse is writing a set of explicit statements about the benefits, risks, and costs of specific courses of medical action. These statements, which help healthcare practitioners, patients, and others make decisions, are known as which type of decision-making tools?

Practice guidelines Rationale: Practice guidelines are explicit statements of what is known and believed about the benefits, risks, and costs of particular courses of medical action. These statements are intended to assist practitioners, patients and others in making decisions about appropriate health care for specific clinical conditions. Risk assessment is a statistical method used to estimate the claims costs of enrollees. Utilization review is a formal, prospective, concurrent, or retrospective assessment of the medical necessity, efficiency, and appropriateness of healthcare services. Diagnosis-related groups are a system of payment classification for inpatient hospital services based on the principal diagnosis, procedure, age and gender of the patient, and complications.

Which statements are true of health maintenance organizations (HMOs)? Select all that apply.

Preventive care is always covered by HMOs. Specialty care is somewhat restricted in HMOs. Rationale: Preventive care is covered and encouraged by HMOs. With HMOs, specialty care can also be somewhat restricted. Loss of choice has led to a decrease in the popularity of HMOs that peaked in the mid-1990s. HMOs now represent a small portion of available plans. HMOs lack enrollee freedom of choice. HMOs were considerably less expensive than other insurance plans at one time, but the difference is now relatively small.

Which statements are true of prospective reimbursement? Select all that apply.

Prospective reimbursement rates are based on diagnoses and patient characteristics. If the provider can provide the treatment for less than is estimated based on the diagnoses related groups, a profit is made Rationale: Prospective reimbursement rates are based on diagnoses and patient characteristics and are designated by the term diagnosis-related group. Provider payment is made according to whether the treatment provided was deemed appropriate for the patient's health issues. Therefore providers can make a profit if the service is provided for less than the cost that was estimated for it. Prospective payment does not lead to overtreatment and overuse of the system. While it does create incentives to control costs, it can also lead to undertreatment and underuse of the system. Implementation of prospective payment led to a reduction in Medicare costs but did not result in overall healthcare cost savings as intended. Originally, only Medicare used prospective reimbursement. Private healthcare plans followed the government's lead and adopted the payment method several years after it was introduced by Medicare.

Which provisions of the Patient Protection and Affordable Care Act are related to prevention and wellness? Select all that apply.

Recommended immunizations Nutrition labeling for chain restaurants Grants to small employers who establish wellness programs Rationale: The ACA requires qualified health plans to provide recommended immunizations, nutrition labeling for chain restaurants and vending machines, and grants to small employers who establish wellness programs. Bariatric surgery and nicotine replacement therapy are not requirements of the ACA.

In which ways were costs for coverage expansion and subsidies under the Affordable Care Act and subsidies offset? Select all that apply.

Reduction in payment for prescription drugs Reduction in payment for Medicare and Medicaid Enhanced efforts to reduce Medicare fraud and abuse Taxes and fees Rationale: Costs for expansion of coverage and subsidies under the ACA were offset by a combination of taxes and fees, reduction in payment for prescription drugs and Medicare and Medicaid services, and enhanced efforts to reduce Medicare fraud and abuse. Rationing and the formation of healthcare alliances are not part of the Affordable Care Act.

Which statements are true regarding payment for home health care? Select all that apply.

Reimbursement is for episodes of care for a period of 60 days. Patients are placed in a home health group using the Outcome and Assessment Information Se Rationale: The reimbursement model for home health care has each episode beginning on the first billable day and proceeding for a period of 60 days. Through the use of a comprehensive evaluative tool, the Outcome and Assessment Information Set, a patient is placed in a home health resource group. Payment is determined by this group. Payment for home health care is received in two parts: 60% at the start of care and 40% after the episode of care is completed. Reimbursement is based on the diagnosis, type, and predicted level of care that will be required. In an effort to control home health expenditures, Medicare changed from a fee-for-service system to a prospective payment system.

Which reasons help explain why the United States does not have universal healthcare coverage? Select all that apply.

Rejection of much higher taxes Concerns over access and availability Objection to paying for care for noncitizens Fears of rationing Rationale: Universal coverage has not been successfully implemented in the United States because of fears of rationing, rejection of the much higher taxes that would be necessary, concerns over access and availability, and objection to paying for the care of noncitizens, among others. Aging of the Baby Boomer generation is one reason it will be vital for policy changes and interventions take place to permit implementation of universal coverage but is not one of the reasons it has not yet been successfully implemented. Competition among healthcare providers and third-party payers is not in opposition to the adoption of universal coverage.

Which statements are true regarding provision of Medicaid? Select all that apply.

State government can choose to provide care to more citizens than mandated by federal government. The federal government will pay 90% of the cost for newly eligible Medicaid beneficiaries for several more years. Mandated services covered by Medicaid for eligible recipients include inpatient and outpatient hospital care, physician's services, vaccines for children, and family planning services. Rationale: The federal government sets baseline eligibility requirements for Medicaid. However, state governments that wish to provide care to more citizens through the Medicaid program can alter the eligibility requirements. The ACA covered payment of services for newly eligible Medicaid beneficiaries until 2016. The federal government will continue to pay 90% of the cost for several more years. Children eligible to receive CHIP (Children's Health Insurance Program) may not receive Medicaid; CHIP is a program that provides insurance for children from low-income families who do not qualify for Medicaid. When the ACA was implemented, funds were made available to provide health care for all adults below the poverty line. However, individual states could elect to not participate.

Which statements are true regarding out-of-pocket costs for Medicare Part B? Select all that apply.

Subscribers must pay deductibles. Subscribers must pay coinsurance. Premiums are prorated and based on income Rationale: Part B requires subscribers to pay deductibles and coinsurance. Premiums for part B are now prorated and based on income. Premiums are not the same for everyone. The average premium is $134 a month, but an individual earning above $214,000 a year would pay $428 a month. Subscribers are responsible for both coinsurance and deductibles.

Which costs are considered capital costs? Select all that apply.

Taxes Interest Depreciation Leases and rentals Rationale: Capital costs include taxes, interest, depreciation, and leases and rentals. Marketing is considered an administrative cost. Salary and benefits are not considered capital costs or administrative costs.

Which statement is true of retrospective reimbursement?

The "umbrella" of costs include salaries, supplies, equipment, building depreciation, utilities, and taxes. Rationale: In retrospective reimbursement, calculation of the fee is based on the cost of providing the service. This "umbrella" of costs can include salaries, supplies, equipment, building depreciation, utilities, and taxes. Prospective reimbursement, not retrospective, is the form of reimbursement used by Medicare. Regardless of the provider's cost, prospective reimbursement is also used to reimburse hospitals according to a predetermined amount. These amounts are determined by diagnoses and patient characteristics and designated by diagnosis-related group.

Which statement is true regarding copayments for inpatient hospital care under Medicare Part A?

The deductible will be the beneficiary's only cost for up to 60 days of Medicare-covered inpatient hospital care. Rationale: The Part A deductible is the beneficiary's only cost for up to 60 days of Medicare-covered inpatient hospital care in a benefit period. Beneficiaries must pay an additional copayment per day for days 61 through 90. This copayment increases per day for hospital stays beyond the 90th day in a benefit period. Starting on day 61, the copayment will increase, not decrease. The beneficiary will pay both a deductible and copayment starting on day 61. The beneficiary must begin paying a small copayment on day 61 of Medicare-covered inpatient hospital stay, not on day one.

The nurse is speaking with an employer who is considering changing from an HMO to a self-insured plan. Which statements are true regarding self-funded plans? Select all that apply.

The self-insured group purchases healthcare services from an established insurance plan. Self-insurance requires a great deal of risk and fiduciary responsibility. Self-insurance allows for control of plan design. Rationale: Self-insurance allows for control of plan design. Design is at the discretion of the employer; therefore, self-funded plans can be redesigned as needed. However, self-insurance requires a great deal of risk and fiduciary responsibility for the employer. There is always a risk for higher utilization or a larger number of individual claimants than expected. The self-insured group administer its own healthcare plan and purchases healthcare services from an established insurance plan. The administrative costs of self-funding are not typically higher for the employer. In fact, the development of self-funded plans has enabled organizations and industries to reduce the administrative cost of insurance. Although most self-insured groups continue to offer ACA-mandated essential health benefits, they are not required to.

A patient is trying to choose between a Health Maintenance Organization (HMO) and Preferred Provider Organization (PPO) insurance plan. Which statement could the nurse make that would be an accurate reflection of HMO and PPO plans? Select all that apply.

There will be a greater selection of providers with the PPO. A gatekeeper referral will be necessary to see a specialist with the HMO. With both the HMO and the PPO, there is the potential for lower-quality care to maximize costs. Rationale: There will be a greater selection of providers with a PPO plan. HMO plans are restricted to providers who are part of the plan, except for in the case of emergencies. With an HMO, a gatekeeper referral will be necessary to see a specialist. The potential for lower quality care to maximize cost exists with both HMO and PPO plans. With HMOs, specialist care is somewhat restricted and costs are reduced by providing only the most necessary services. With PPOs, providers are offered a specific reimbursement, regardless of the services rendered.

Which country spends the most on health care?

USA Rationale: The United States spends more on health care than any other country. The U.S. total health expenditure per capita is higher than that of any other country, including Japan, Canada, and Mexico.

The nurse employed by a health plan is tasked with reviewing healthcare services to determine the medical necessity, efficiency, and appropriateness of the services. Which duty is the nurse performing?

Utilization review Rationale: Utilization review is a formal prospective, concurrent, or retrospective assessment of the medical necessity, efficiency, and appropriateness of healthcare services. Risk assessment is a statistical method used to estimate claims costs of enrollees. Care management is the process used to improve quality of care by analyzing variations in and outcomes for current practice in the care of specific health conditions. Actuarial classification is the classification of enrollees that is determined by use of the mathematics of insurance, including probabilities, to ensure adequacy of the premium to provide future payment.