Free AHIP AHM-520 Exam Questions

Become AHIP Certified with updated AHM-520 exam questions and correct answers

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Total 215 Questions | Updated On: Mar 13, 2026

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Question 1

The Fairway health plan is a for-profit health plan that issues stock. The following data was taken from Fairway's financial statements:

Current assets.....$5,000,000 -

Total assets.....$6,000,000 -

Current liabilities.....$2,500,000

Total liabilities.....$3,600,000

Stockholders' equity.....$2,400,000

Fairway's total revenues for the previous financial period were $7,200,000, and its net income for that period was $180,000.

For the previous financial period, Fairway's net profit margin was:

A : 2.50%

B : 3.00%

C : 3.60%

D : 7.50%

Answer: A

Question 2

The following statements are about the financial risks for health plans in Medicare and Medicaid markets. Three of these statements are true, and one statement is false. Select the answer choice containing the FALSE statement.

A : One reason that health plans in the Medicare and Medicaid markets experience financial risk is that government regulations determine which services must be provided to Medicare and Medicaid enrollees.

B : Effective use of hospital utilization is the single most likely factor to contribute to the success of a Medicare-contracting health plan.

C : If a Medicare-contracting health plan is a provider-sponsored organization (PSO), it is prohibited from sharing financial risk with its providers.

D : Typically, providers are more reluctant to accept financial risk in connection with providing services to the Medicaid population than with providing services to the Medicare population.

Answer: C

Question 3

The Fairway health plan is a for-profit health plan that issues stock. The following data was taken from Fairway's financial statements:

Current assets.....$5,000,000 -

Total assets.....$6,000,000 -

Current liabilities.....$2,500,000

Total liabilities.....$3,600,000

Stockholders' equity.....$2,400,000

Fairway's total revenues for the previous financial period were $7,200,000, and its net income for that period was $180,000.

Assume that the healthcare industry average for the debt-to-equity ratio is 0.90.

The following statement(s) can correctly be made about Fairway's debt to equity ratio:

A : Fairway's debt-to-equity ratio is 1.50

B : Fairway relies less than most other healthcare organizations on borrowed funds to cover future and current benefit payments, to pay for ongoing business operations, and to finance growth

C : Both A and B

D : A only

E : B only

F : Neither A nor B

Answer: B

Question 4

Federal law addresses the relationship between Medicare- or Medicaid contracting health plans and providers who are at "substantial financial risk."

Under federal law, Medicare- or Medicaid-contracting health plans:

A : Place a provider at "substantial risk" whenever incentive arrangements put the provider at risk for amounts in excess of 10% of his or her total potential reimbursement for providing services to Medicare and Medicaid enrollees

B : Must provide stop-loss coverage to a provider who is placed at "substantial financial risk" for services that the provider does not directly provide to Medicare or Medicaid enrollees

C : Both A and B

D : A only

E : B only

F : Neither A nor B

Answer: C

Question 5

Companies typically produce three types of budgets: operational budgets, cash budgets, and capital budgets. The following statements are about operational budgets. Select the answer choice containing the correct statement.

A : Expense budgets, a type of operational budget, typically describe fixed expenses rather than variable expenses.

B : Operational budgets can only show information by department or by line of business.

C : Operational budgets begin with a forecast of sales revenue and investment income.

D : Revenue budgets, a type of operational budget, indicate the amount of income from operations that a company received from the previous budget period

Answer: C

Page: 1 / 43

Total 215 Questions | Updated On: Mar 13, 2026

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