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AHIP AHM-520 Exam Questions
- Topic 1: Recognize different reserving methodologies used by health insurance providers/ Analyze the role of strategic financial planning in setting a health insurance provider’s future direction
- Topic 2: Learn about the financial risks for health insurance provider organizations that provide health care services to Medicare and/or Medicaid populations compared to risks within the commercial population
- Topic 3: Discover how to identify claim related components of health insurance providers’ financial statements
- Topic 4: Gain an understanding of risk, decisions regarding risk assumption, and how health insurance providers control risk
- Topic 5: Distinguish between fully funded and self-funded plans and the increasing role of self-funding in the marketplace
- Topic 6: Compare the difference between stop-loss insurance and stop-loss reinsurance from the perspective of health insurance providers
Free AHIP AHM-520 Exam Actual Questions
Note: Premium Questions for AHM-520 were last updated On Mar. 20, 2025 (see below)
A health plan may experience negative working capital whenever healthcare expenses generated by plan members exceed the premium income the health plan receives.
Ways in which a health plan can manage the volatility in claims payments, and therefore reduce the risk of negative working capital, include:
1. Accurately estimating incurred but not reported (IBNR) claims
2. Using capitation contracts for provider reimbursement
The Amethyst Health Plan uses a budgeting approach that requires each line of business within Amethyst's operation to justify its continued operation. Amethyst begins with the premise that no resources will be allocated for the following period unless each dollar to be spent is justified and is shown to be within departmental plans and corporate goals and objectives. The budgeting approach used by Amethyst is known as:
A health plan may experience negative working capital whenever healthcare expenses generated by plan members exceed the premium income the health plan receives.
Ways in which a health plan can manage the volatility in claims payments, and therefore reduce the risk of negative working capital, include:
1. Accurately estimating incurred but not reported (IBNR) claims
2. Using capitation contracts for provider reimbursement
Costs that can be defined by behavior are most commonly classified as fixed costs, variable costs and semi-variable costs. Examples of fixed costs include:
For a given healthcare product, the Magnolia Health Plan has a premium of $80 PMPM and a unit variable cost of $30 PMPM. Fixed costs for this product are $30,000 per month. Magnolia can correctly calculate the break-even point for this product to be:
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