AHIP AHM-520 Exam - Topic 4 Question 95 Discussion

Actual exam question for AHIP's AHM-520 exam

Question #: 95
Topic #: 4

The Northwest Company offers its employees the option of choosing to receive their healthcare benefits from an HMO or from a traditional indemnity plan. The premiums for the HMO are lower than for the traditional indemnity plan. In this situation, it is correct to assume that:

1. Individual low utilizers are more likely to enroll in the traditional indemnity plan

2. Individual high utilizers are more likely to enroll in the HMO

ABoth 1 and 2

B1 only

C2 only

DNeither 1 nor 2

Show Suggested Answer

Suggested Answer: D

by Daniel at Aug 22, 2024, 08:59 PM

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Bettye

7 months ago

Traditional plans usually attract those who want more control over their care.

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Claribel

7 months ago

Totally agree, high utilizers need more coverage, HMO fits!

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Valentin

7 months ago

Wait, are high utilizers really going for the HMO? Seems odd.

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Mabelle

7 months ago

I think low utilizers would prefer the indemnity plan for flexibility.

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Carlton

8 months ago

HMO premiums are definitely lower, so that makes sense.

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Marnie

8 months ago

I'm a bit confused about the first statement. Wouldn't low utilizers be more cost-conscious and therefore choose the cheaper HMO?

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Virgina

8 months ago

This question feels familiar; I think we practiced something similar where we talked about risk selection in health plans.

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Allene

8 months ago

I think high utilizers would definitely lean towards the HMO because of the lower premiums and better access to care, but I can't recall if that's always true.

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Vincenza

8 months ago

I remember discussing how low utilizers might prefer the traditional plan for more flexibility, but I'm not entirely sure if that's the case here.

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In

8 months ago

This is a classic case of adverse selection. The low-risk individuals will self-select into the traditional indemnity plan, while the high-risk individuals will choose the HMO with the lower premiums. I'm confident I can apply this concept correctly on the exam.

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Rene

8 months ago

Okay, I think I've got this. The key is that the HMO premiums are lower, so the high utilizers will be more likely to choose the HMO to get better coverage at a lower cost. The low utilizers will prefer the traditional indemnity plan since they won't need the extra benefits of the HMO.

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Lavonna

8 months ago

Hmm, I'm a little unsure about this one. I know adverse selection is a key concept, but I'm not totally confident in applying it to this specific scenario. Let me re-read the question carefully.

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Mireya

9 months ago

This seems like a straightforward question about adverse selection in healthcare plans. I'll need to think through the incentives for low and high utilizers to choose between the HMO and indemnity plan.

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Loren

9 months ago

This question seems pretty straightforward. I'll focus on the key points about the Content Service and normalization rules.

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Carmelina

2 years ago

D) Neither 1 nor 2? What kind of trick question is this? Of course individual risk profiles would determine their plan choice. I'm not falling for that one!

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Starr

2 years ago

Hey, if I'm a high utilizer, I'm definitely going for the traditional plan! Why would I willingly sign up for the HMO plan and have to jump through hoops to see a specialist? A) Both 1 and 2 is the way to go.

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Latrice

2 years ago

I see your point, Tegan. So, the answer could be both 1 and 2.

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Tegan

2 years ago

But wouldn't individual high utilizers benefit more from the comprehensive coverage of the HMO?

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Jestine

2 years ago

I'm going with C) 2 only. It just makes sense that people who expect to use more healthcare services would choose the HMO to get the lower premiums, even if it means more restrictions.

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Janey

2 years ago

I think I would go with A) Both 1 and 2, because low utilizers might prefer the traditional indemnity plan for more flexibility.

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Charlene

2 years ago

I agree with you, C) 2 only seems like the logical choice for high utilizers.

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Barrett

2 years ago

I agree with Tom, the lower premiums would be more attractive to low utilizers.

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Tom

2 years ago

I think individual low utilizers would prefer the traditional indemnity plan.

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Dwight

2 years ago

I think the correct answer is B) 1 only. Low utilizers would logically choose the cheaper HMO plan, while high utilizers would be more likely to opt for the traditional indemnity plan with its higher premiums but wider coverage.

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Truman

2 years ago

That makes sense, so the correct answer is B) 1 only.

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Nida

2 years ago

But wouldn't high utilizers want the wider coverage of the traditional plan?

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Dell

2 years ago

I agree with you, low utilizers would definitely go for the cheaper option.

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