Chapter 11: Managed Care

Question 1

Traditional health insurances cover the costs of ____ and ____

Answer 1

accident
sickness

Question 2

At the end of the treatment, the insured will either pay the hospital and be ______ for most of the cost by their insurer, or the insured will assign the benefits to their health providers and the insurer pays them directly.

Answer 2

indemnified

Question 3

The purpose of ____ ____ is simple: provide good medical care at affordable cost through monitoring all aspects of treatment

Answer 3

managed care

Question 4

TF: Managed Care = Cost Containment

Answer 4

True

Question 5

How managed care reduces costs?

Answer 5

The organization uses the power of a large group of guaranteed subscribers to secure reduced fees from doctors and other medical providers. They structure plan rules so they encourage preventative care (free annual checkups and screens, for instance) and early diagnoses, thereby reducing the major costs involved in treatment

Question 6

Three most important managed care models?

Answer 6

Health Maintenance Organization (HMO)
Preferred Provider Organization (PPO)
Point-of-service Plan (POS)

Question 7

A ____ _____ ______ , also called a Health Insurance Organization or HIC in some states, is a managed health care plan in which a group of medical providers contracts with a group to provide medical care for its members at prices both agree to and that are lower than the costs of traditional insurance. This is the original model in Managed Health Care.

Answer 7

Health Maintenance Organizations (HMOs)

Question 8

Before an HMO can offer coverage and benefits to the public, the HMO must obtain a ____ of ____ from the state’s Department of Insurance. The HMO owns or contracts with a clinic and staffs it. It subcontracts with a hospital.

Answer 8

certificate of authority

Question 9

TF: The HMO provides free preventative medical care (annual physical exams and routine well-child visits, immunizations, age related preventative treatment, etc.) in an effort to identify and treat problems early, thus promoting health and saving money.

Answer 9

True

Question 10

The HMO has control both of the _____ and the ______ of health care (the medical facilities and staff and the members who will use them). Thus, it stands a good chance of containing costs more efficiently than other managed care models.

Answer 10

Producers
Purchasers

Question 11

HMOs are considered ___-____ service organizations.

Answer 11

Pre-Paid

Question 12

Four models of HMOs?

Answer 12

Staff,
Group,
Network, and
Individual practice association model.

Question 13

Under the ____ _____, physicians are employees of the HMO. Physicians provide care from the HMO’s clinic. This model has their own hospitals.

Answer 13

Staff Model

Question 14

Under the ____ ____ (also referred to as a medical group or group practice model), the HMO contracts with one independent medical group to provide medical services to HMO members. Each physician is paid on a contract-basis with the HMO, not as a salaried employee. Essentially, the HMO rents the medical providers.

Answer 14

group model

Question 15

Under an ____ ____ arrangement, medical providers can treat patients who are not members of the HMO, whereas, in a ____ ____, the medical providers exclusively treat members of the HMO.

Answer 15

Open Panel
Closed Panel

Question 16

Similar to the group model, a ____ _____ HMO contracts with two or more medical groups (instead of one) to provide medical services to HMO members. These HMOs contract with independent physicians who provide medical services from their independent offices.

Answer 16

Network model

Question 17

The ____ ____ ____ model functions like the group model, except the HMO contracts with medical groups, physicians’ associations, and independent physicians, which then contract with their member physicians to provide health care services.

While members can choose any doctor in the panel, they will not be able to pick their surgeon, but will most likely be referred to a specific HMO member surgeon by their primary care physician.

Answer 17

Individual Practice Association

Question 18

The HMO provides free prepaid annual examinations and diagnostic screenings, well-child care from birth, eye and ear examinations for children age 17 and under, immunizations, and wellness programs. The pre-payment is called a _____-______ basis, meaning the member pays for a range of services provided by the HMO and nominal co-pay for services that are not exempt from co-pay.

Answer 18

Service Incurred

Question 19

Traditional health insurance coverage, on the other hand, pays only for the treatment of disease or illness, not for preventative care. Typically, it also pays on a ____ _____ (i.e., the insured pays the medical fee and is paid back by the insurance company).

Answer 19

Reimbursement Basis

Question 20

TF: In addition to preventative health services, HMOs also offer health education programs to promote better health choices, such as smoking cessation, diabetes management, mental health and substance abuse benefits, family planning services, and childbirth preparation classes.

Answer 20

True

Question 21

TF: HMOs have limited provider choices, unlike health insurance, which does not

Answer 21

True

Question 22

The “_____ _____” is where the PCP acts as the ____ (same word), whereas patients must visit the PCP when they require medical services. The PCP will consult records of all physicians and other providers in the HMO in order to coordinate the patient’s treatment.

Answer 22

Gatekeeper System,
Gatekeeper

Question 23

The purpose of the gatekeeper system is to preclude ____ ____ and ____.

Answer 23

Unnecessary visits and treatments

Question 24

The _____-______ _____ option allows subscribers to consult with different medical parishioners for second and third opinions regarding the necessity of surgical procedures.

Answer 24

Second surgical opinion

Question 25

The HMO _____ _____ is a defined geographic area to which services are limited. To be eligible to enroll in the HMO, an individual must reside within this area, which generally is fairly small.

Answer 25

Service Area

Question 26

TF: A subscriber who needs emergency care while on business or vacationing out of the HMO area can usually qualify for the benefit. Also, if a subscriber needs to use an urgent care facility in a critical emergency situation, those services will be covered.

However, if a subscriber is within the HMO area and uses a non-HMO emergency room, the services received will not be covered.

Answer 26

True

Question 27

TF: Members have 24-hour access to the HMO. Telephones are answered and referrals and authorizations are made 24 hours a day, seven days a week. Nursing and medical staff, including PCPs, must be willing to respond during non-business hours.

Answer 27

True

Question 28

________ is the payment method used by HMOs. The HMO pays in-network health care providers a fixed amount for each member of the HMO.

Answer 28

Capitation - per head = per cap(pay per member, NOT per service)

Question 29

During the ____ _______ _____, which typically lasts 30 days, new individuals are allowed to enroll in the HMO and the HMO may not reject any applicant for health reasons.

Answer 29

Open Enrollment Period

Question 30

TF: Pre-existing conditions can be excluded in HMOs

Answer 30

False - they can NOT

Question 31

__________ are small dollar amounts HMO members are charged each time they visit a doctor or use a service, except for those provided free of charge (see above). This is a small percentage of the actual cost of the medical care.

Answer 31

Copayment

Question 32

HMOs are required to deliver to each subscriber the certificate of coverage, along with any other enrollment information, within ___ ___ of enrollment.

Answer 32

10 days

Question 33

_________ ________ is the cost-control program used by HMOs that includes primary care physicians as “gatekeepers,” utilization reviews, and prescription drug formularies. This assures patients receive necessary care, but not unnecessary care.

Answer 33

Utilization Management

Question 34

Three components of Utilization review?

Answer 34

Preadmission review,

Concurrent review (while the patient is in a hospital), and

Discharge review plans.

Question 35

TF: HMOs generally own or are served by a central medical facility, such as a university medical school or an HMO-owned clinic, and subcontracts with one or more hospitals in its service area. In theory, with a closed panel of fewer providers, the group is better able to manage costs.

Answer 35

True

Question 36

HMOs must have a complaint system that allows members to provide written complaints to the HMO. Members must be provided with an address and telephone number and forms to forward complaints. In most cases, complaints must be settled within ____ ____ of filing

Answer 36

180 days

Question 37

TF: HMOs are required to provide the following supplementary health care services:

Vision
Dental
Prescription drugs
Home health care
Long-term care

Answer 37

False - NOT required, but many do anyway

Question 38

The _____ ____ _____ evolved out of the HMO model. It offers the patient more choices in doctors and medical facilities than an HMO offers.

Answer 38

Preferred Provider Organization PPO

Question 39

TF: A PPO is a managed-care arrangement under which a selected group of independent hospitals and medical practitioners in an area, such as a state, agrees to provide a range of services at a prearranged cost. The organizer or contracting agency of a PPO might be one of a number of groups.

Answer 39

True

Question 40

TF: The contract is usually between the network and the provider; however, insurance companies, TPAs and, on rare occasions, large employers who have their individual claims payment units may also be contracting parties. There is no case when the individual employee will be part of a PPO contract.

Answer 40

True

Question 41

TF: One disadvantage of PPOs occurs when a PPO contracts with a group of physicians rather than individual doctors, where individual doctors may move out of a practice for a number of reasons and the contract does not automatically go with them.

Answer 41

True

Question 42

TF: Generally the service area for a PPO is much larger than the service area of an HMO. The PPO does not own or sub-contract with a clinic and thus is adaptable to larger geographical areas. Many states create PPOs for state employees, for instance.

Answer 42

True

Question 43

TF: Although members of a PPO must select from a list of Preferred Providers for full coverage, the range of choices is far greater than the range of choices for an HMO.

Answer 43

True

Question 44

TF: PPOs are different than an EPO, or exclusive provider organization plan, which does not provide any amount of reimbursement or reduction to an insured who goes outside of the network for medical care.

Answer 44

True

Question 45

TF: With PPOs, no primary care physician is used as a gatekeeper and there are no mandatory referral requirements.

Answer 45

True

Question 46

TF: PPO plans generally pay partial benefits for emergency treatment regardless of where and by whom it is performed.

Answer 46

False - pays in full

Question 47

TF: With a PPO, there is no group-owned facility.

Answer 47

True

Question 48

PPOs providers are paid on a ___-___-____ basis

Answer 48

Fee For Service

Question 49

Open Panel vs Closed Panel PPOs?

Answer 49

Open Panel - membership is open to any and all providers who wish to provide services for the group
Closed Panel - a limited number of health providers are chosen by the PPO and treat members of the PPO exclusively

Question 50

F: For PPOs, with a closed panel of fewer providers, the group is better able to manage costs.

Answer 50

True

Question 51

____ ____ ____ Plans are a type of managed care in which the subscriber is given a choice of receiving in-network care or out-of-network care. Their flexibility and the control they offer subscribers give them appeal.

Answer 51

Point of Service (POS)

Question 52

Features of POS Plan - In-network coverage?

Answer 52

Care received through network of doctors and hospitals
the PCP is the gatekeeper and makes all referalls
This plan pays more toward medical services, and doesn’t require claim forms

Question 53

Features of POS Plan - Out of-network coverage?

Answer 53

Care is received outside of the POS network
The PCP does not coordinate the care
Insureds pay more for care, and need to submit claim forms to receive benefits

Question 54

For Out of Network services in a POS plan?

Answer 54

Services rendered by non-preferred providers must be covered at a rate of at least 80 % of the coverage offered for the services of preferred providers.

Question 55

TF: An open-ended HMO, also known as a Point-of-service HMO, is a hybrid of the HMO model and the POS model. Participants may use non-HMO providers at any time and receive indemnity benefits that are subject to higher deductible and coinsurance amounts.

Subscribers simply pay more for the privilege of having control of choosing a health care provider.

Answer 55

True

Question 56

TF: Preventative care exams and screenings save insurers money by lowering long term costs associated with providing care

Answer 56

True

Question 57

TF: Ambulatory facilities most often are found in hospital outpatient care facilities. They provide alternatives to hospital services and are significantly less expensive.

Answer 57

True

Question 58

____ _____ is one cost-control mechanism currently being used by insurers and employers in order to assure the best treatment is being given in the best possible setting for the insured. ____ ____ (same thing) is an evaluation of the propriety, necessity, and quality of health care.

Answer 58

Utilization Review

Question 59

Three parts of Utilization Management>

Answer 59

Prospective Review (or preadmission certification)
Concurrent Review, and
Retrospective Review

Question 60

______ Review (also called precertification review) allows the insurance company to evaluate the appropriateness of the procedure and the length of the hospital stay. The physician submits claim information prior to treatment, asking for certification. The review tells him whether the procedure is covered un

Answer 60

Prospective

Question 61

________ Review is the insurer’s monitoring the insured’s progress in the hospital in order to assure treatment and recovery are following a normal schedule and the insured will be released from the hospital according to pre-certification plans

Answer 61

concurrent

Question 62

________ review allows the insurance company to evaluate the effectiveness of any services provided after care is given. During the retrospective review process, patient care data is analyzed and the several factors are considered: medical necessity, quality of care, and appropriateness of medical setting.

Answer 62

Retrospective

Question 63

As one moves from the HMO to the Point-of-Service model, patient choice ______

Answer 63

Increases

Question 64

TF: The HMO member must go to a group-owned clinic and see whatever primary care physician is available at that time.

Answer 64

True

Question 65

TF: The PPO member will likely have several approved facilities with a number of physicians near their home from which to choose. And should he or she still prefer an out-of-network facility, they may use it, though at a slightly higher cost in copayment.

Answer 65

True

Question 66

TF: The POS member may choose whatever provider or facility he or she likes, so long as they are willing to pay a larger deductible or co-pay.

Answer 66

True

Question 67

TF: one cost-cutting element has spread from Managed Care Plans to commercial insurance. Today, all insurers practice utilization management.

Answer 67

True

Question 68

POS plans are a mix of:
Select one:
a. HMOs and PPOs
b. Base plans and comprehensive plans
c. Major medical and base plans
d. Open and closed panel

Answer 68

A

Question 69

How do managed care plans control medical care costs?
Select one:
a. Requiring plan participants to obtain second surgical opinions
b. Precertification
c. Emphasizing preventative care
d. All of the above

Answer 69

D

Question 70

All of the following are true regarding HMOs, EXCEPT:
Select one:
a. HMOs are managed care cost containment health care programs.
b. HMOs provide health insurance coverage and medical services.
c. HMOs are prepaid programs which focus on preventive care.
d. Subscribers may see referral specialists without needing to see primary care physicians.

Answer 70

D

Question 71

Which of the following is a managed care plan?
Select one:
a. HMO
b. PPO
c. POS plan
d. All of the above

Answer 71

D

Question 72

All of the following are true regarding PPOs, EXCEPT:
Select one:
a. PPOs are a group of medical facilities, physicians and practitioners in a designated geographic area that agree to provide medical services at a discount.
b. PPO members typically pay more than non-PPO members.
c. Compared to an HMO, members of a PPO have more options and choices in the medical providers from which they can utilize.
d. No matter where a member under a PPO receives emergency care, it is covered by the plan.

Answer 72

B

Question 73

TF: Preferred Provider Organizations, or PPOs, are a group of medical facilities, physicians and practitioners in a designated geographic area that agree to provide medical services at a reduced cost. The cost of care provided by a PPO is usually less than what non-PPO members are charged. Compared to an HMO, members of a PPO have more providers from which to choose. In an emergency situation, the PPO will pay the full cost, regardless of where and from whom the member receives emergency care.

Answer 73

True