The Health Maintenance Organization (HMO) Model Act, Developed by the National

question 13

Multiple Choice

The Health Maintenance Organization (HMO) Model Act, developed by the National Association of Insurance Commissioners (NAIC) , represents one approach to developing solvency standards. One drawback to this type of solvency regulation is that it

• A) Uses estimates of future expenditures and premium income to estimate future risk
• B) Fails to adjust the solvency requirement to account for the size of an HMO's premiums and expenditures
• C) Assumes that the amount of premiums an HMO charges always directly corresponds to the level of the risk that the HMO faces
• D) Fails to mandate a minimum level of capital and surplus that an HMO must maintain

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Definitions:

Pseudocoelom

A fluid-filled body cavity lying inside the external body covering but outside the innermost gut tube, found in some invertebrates.

Phylogeny

The evolutionary history and lineage of species or a particular group of organisms.

Deuterostome

A classification of animals defined by their developmental characteristics, where the anus forms before the mouth during embryonic development.

Echinoderms

Echinoderms are a group of marine invertebrates that include sea stars, sea urchins, and sand dollars, characterized by radial symmetry and a unique water vascular system.