In the Course of Doing Business, Health Plans Conduct Basic

question 62

Multiple Choice

In the course of doing business, health plans conduct basic corporate transactions. For example, when a health plan engages in the corporate transaction known as aggressive sourcing, the health plan

• A) Chooses to contract with vendors who provide specific functions that would otherwise be performed in-house, such as paying claims
• B) Seeks to obtain the best deals from various vendors for equipment, supplies, and services such as telephones, overnight mail, computer hardware and software, and copy machines
• C) Merges with one or more companies to form an entirely new company
• D) Joins with one or more companies, but retains its autonomy and relies on the other companies to perform specific functions 6

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Definitions:

Journal Entry

A record in accounting that documents a business transaction, indicating the accounts and amounts debited and credited.

Contract Rate

The agreed-upon interest rate in a lending agreement, bond, or other financial contracts.

Market Rate

The prevailing interest rate available in the market for securities of a similar risk and maturity, or the standard rate charged or paid for a specific service or commodity.

Face Amount

The nominal value or principal amount of a security stated by the issuer, due to be paid at maturity.