Experience Rating Methods Can Be Either Prospective or Retrospective

question 106

Multiple Choice

Experience rating methods can be either prospective or retrospective. With regard to these types of experience rating methods, it can correctly be stated that

• A) A health plan typically can expect much higher profit levels from using retrospective experience rating rather than prospective experience rating a health plan using prospective experience rating is more likely than a
• B) Health plan using retrospective experience rating to have to pay an experience rating dividend if a group's experience has been better than expected during the rating period
• C) The premium determined under retrospective experience rating is usually higher than the premium under prospective experience rating
• D) Most states require HMOs to use retrospective experience rating rather than prospective experience rating

---

Definitions:

Predicting

The act of forecasting future events or outcomes based on patterns, data, or insights from past and present.

Describing

The act of providing details about something, including its features, qualities, and condition.

Genetically Influenced

Traits or characteristics that are shaped in part by an organism's genetic makeup.

Extraversion

Extraversion is a personality trait characterized by outward turning of emotional, mental, and social energy, favoring an active engagement with the external world.