Quiz Module 1: Part 2

Under the broad category of fee-for-service (FFS), what are the three main types of fee-for-service methodologies that were discussed in class?

1. Charge-Based 2. Cost-Based 3. Prospective Payments

Identify all the different types of managed care insurance plans.

1. Health maintenance organizations (HMOs) 2. Point-of-service (POS) plans 3. Preferred provider organizations (PPOs)

Relative Value Units (RVUs) are standards that are payment components consisting of the following:

1. Malpractice/Liability Expense 2. Work Expense 3. Practice Expenses

For insurance to "work," it must have these basic characteristics.

1. Risk transfer 2. Payment only for random (unforeseen and unexpected) losses 3. Pooling of losses

Select all of the TRUE statements about ICD Codes.

1. The greater number of digits in the code, the more detailed the disease 2. ICD-10 is the current standard. 3. ICD - stands for International Classification of Diseases 4. The codes currently consist of 3, 4, 5, 6, or 7 digits/characters

Individuals at greater risk of needing health care are more likely to purchase insurance

Adverse Selection

Payment is (usually) made on a per member per month basis

Capitation

Providers may have an incentive to reduce utilization.

Capitation

Has potential to result in 'gamesmanship' that can inflate healthcare charges.

Charge-Based

Payers pay based off of pre-determined "chargemaster." These payments are usually discounted up to 20% to 50%

Charge-Based

Requires an individual to pay for a certain percentage of the eligible medical expenses

Coinsurance

The fixed amount for a covered service that the insurer mandates that the patient pay to the provider before the patient receives service from the provider

Copayments

No incentive to control costs.

Cost-Based

Providers were reimbursed for "actual" costs

Cost-Based

Medicare Part A

Covers hospital and some skilled nursing home coverage

Medicare Part B

Covers physician services, ambulatory surgical services, out

The amount that must be paid out of pocket by the policyholder before an insurance provider will pay any expenses

Deductibles

Medicare Part C

Is often called Medicare Advantage

The risk of overuse of health services because the insured does not bear the full cost of the consequences

Moral Hazard

Are used to pay for either a predefined procedure, diagnosis, per diem or bundled service

Prospective Payment

May result in up-coding.

Prospective Payment

Under the Patient Protection and Affordable Care Act (PPACA), insurance companies have to use community ratings

True

Medicare Part D

covers prescription drugs