Deal of The Day! Hurry Up, Grab the Special Discount - Save 25% - Ends In 00:00:00 Coupon code: SAVE25
Welcome to Pass4Success

- Free Preparation Discussions
Mail Us support@pass4success.com
Location US
Mob_nav_barsMENU

AHIP AHM-520 Exam - Topic 5 Question 114 Discussion

The Longview Hospital contracted with the Carlyle Health Plan to provide inpatient services to Carlyle's enrolled members. Carlyle provides Longview with a type of stop-loss coverage that protects, on a claims incurred and paid basis, against losses arising from significantly higher than anticipated utilization rates among Carlyle's covered population. The stop-loss coverage specifies an attachment point of 130% of Longview's projected $2,000,000 costs of treating Carlyle plan members and requires Longview to pay 15% of any costs above the attachment point. In a given plan year, Longview incurred covered costs totaling $3,000,000.With regard to the type of stop-loss coverage provided to Longview by Carlyle and to whether this coverage is classified as insurance or reinsurance, the risk transfer approach used in this situation can be described as:
C) specific stop-loss reinsurance
A) aggregate stop-loss reinsurance
B) aggregate stop-loss insurance
D) specific stop-loss insurance

AHIP AHM-520 Exam - Topic 5 Question 114 Discussion

Actual exam question for AHIP's AHM-520 exam
Question #: 114
Topic #: 5
[All AHM-520 Questions]

The Longview Hospital contracted with the Carlyle Health Plan to provide inpatient services to Carlyle's enrolled members. Carlyle provides Longview with a type of stop-loss coverage that protects, on a claims incurred and paid basis, against losses arising from significantly higher than anticipated utilization rates among Carlyle's covered population. The stop-loss coverage specifies an attachment point of 130% of Longview's projected $2,000,000 costs of treating Carlyle plan members and requires Longview to pay 15% of any costs above the attachment point. In a given plan year, Longview incurred covered costs totaling $3,000,000.

With regard to the type of stop-loss coverage provided to Longview by Carlyle and to whether this coverage is classified as insurance or reinsurance, the risk transfer approach used in this situation can be described as:

Show Suggested Answer Hide Answer
Suggested Answer: C

by Margurite at Jul 10, 2025, 07:51 AM

Limited Time Offer

25%

Off

Get Premium AHM-520 Questions as Interactive Web-Based Practice Test or PDF

Contribute your Thoughts:

0/2000 characters
Submit Cancel
Alyce
9 months ago
I agree with Gabriele, reinsurance makes more sense here.
upvoted 0 times
...
Laurel
9 months ago
I think it's aggregate stop-loss insurance, not reinsurance.
upvoted 0 times
...
Donte
10 months ago
Not sure about this one, could it be specific stop-loss instead?
upvoted 0 times
...
Ronnie
10 months ago
Wait, so Longview pays 15% over the attachment point? That's surprising!
upvoted 0 times
...
Gabriele
10 months ago
This is definitely aggregate stop-loss reinsurance.
upvoted 0 times
...
Billi
10 months ago
I’m leaning towards specific stop-loss insurance because of the way the costs are structured, but I need to double-check my notes on this.
upvoted 0 times
...
Hester
10 months ago
I practiced a similar question where we had to identify types of stop-loss. I feel like the attachment point indicates it's aggregate, but I could be wrong.
upvoted 0 times
...
Annice
11 months ago
I think this is aggregate stop-loss insurance since it covers total costs above a certain point, but I might be mixing it up with reinsurance.
upvoted 0 times
...
Rolande
11 months ago
I remember discussing stop-loss coverage in class, but I'm not sure if this is aggregate or specific.
upvoted 0 times
...
Tawny
11 months ago
I've got this! The question is asking about the risk transfer approach, and based on the information provided, it sounds like Carlyle is offering aggregate stop-loss reinsurance to Longview. The attachment point and Longview's responsibility for 15% of costs above that point are the giveaways.
upvoted 0 times
...
Nancey
11 months ago
Okay, let me break this down. The key details are that Carlyle provided stop-loss coverage to Longview, with an attachment point of 130% of Longview's projected costs. I just need to figure out if that's considered aggregate or specific stop-loss, and whether it's classified as insurance or reinsurance.
upvoted 0 times
...
Delmy
11 months ago
Hmm, I'm a little unsure about the difference between insurance and reinsurance here. I'll need to think through the details of the coverage to determine which one it is.
upvoted 0 times
...
Noel
12 months ago
This one seems pretty straightforward. I think it's asking me to identify the type of stop-loss coverage that Carlyle provided to Longview.
upvoted 0 times
...
Evette
1 year ago
I see your point, Amos, but I still think A) is the best choice based on the information provided.
upvoted 0 times
...
Amos
1 year ago
I'm not sure, but I think it could also be C) specific stop-loss reinsurance.
upvoted 0 times
...
Catalina
1 year ago
This is a tricky one, but I'm leaning towards A) aggregate stop-loss reinsurance. The attachment point and the percentage of costs above that point make it sound like a reinsurance arrangement to me.
upvoted 0 times
Karma
12 months ago
Yeah, it definitely seems more like reinsurance than insurance.
upvoted 0 times
...
Kati
12 months ago
Yes, the terms of the coverage definitely align more with reinsurance than insurance.
upvoted 0 times
...
James
1 year ago
I agree, the attachment point and cost-sharing percentage point towards reinsurance.
upvoted 0 times
...
Doretha
1 year ago
I'm not sure, but it does seem like a reinsurance setup.
upvoted 0 times
...
Lawrence
1 year ago
I agree, the attachment point and cost percentage point towards reinsurance.
upvoted 0 times
...
Joaquin
1 year ago
I think it's A) aggregate stop-loss reinsurance.
upvoted 0 times
...
Lavera
1 year ago
I think you're right, it does seem more like a reinsurance arrangement.
upvoted 0 times
...
...
Naomi
1 year ago
I agree with Evette, because the attachment point is based on Longview's total costs.
upvoted 0 times
...
Zona
1 year ago
Haha, this question is making my head spin! I'm just going to go with the flow and pick D) specific stop-loss insurance. Who knows, maybe I'll get lucky!
upvoted 0 times
...
Herminia
1 year ago
Hmm, I'm not so sure. The question mentions 'on a claims incurred and paid basis,' which makes me think it could be C) specific stop-loss reinsurance.
upvoted 0 times
...
Justine
1 year ago
I think the answer is B) aggregate stop-loss insurance. The coverage seems to protect Longview against higher than anticipated utilization rates, which suggests an aggregate approach rather than a specific one.
upvoted 0 times
Arlean
1 year ago
Yes, I think you're right. The coverage provided by Carlyle to Longview fits the description of aggregate stop-loss insurance.
upvoted 0 times
...
Bette
1 year ago
I agree, it does seem like B) aggregate stop-loss insurance would be the correct answer.
upvoted 0 times
...
...
Evette
1 year ago
I think the answer is A) aggregate stop-loss reinsurance.
upvoted 0 times
...

Save Cancel