CPHRM CPHRM Exam 3 — Questions and Answers
Question 1: A hospital is considering a captive insurance arrangement. What is the primary advantage of this approach?
- Eliminates all malpractice risk
- Provides more control over underwriting and cash flow (Correct answer)
- Guarantees government reimbursement
- Removes the need for claims management
Correct answer: Provides more control over underwriting and cash flow
A captive insurer is owned by the hospital and allows direct control over underwriting criteria, loss reserves, and investment of premium dollars.
Question 2: Under EMTALA, what must a hospital with an emergency department do when a patient arrives?
- Admit the patient for inpatient care immediately
- Provide a medical screening examination to all patients (Correct answer)
- Transfer all uninsured patients to public hospitals
- Obtain insurance pre-authorization before treatment
Correct answer: Provide a medical screening examination to all patients
EMTALA requires hospitals to provide a medical screening exam and stabilizing treatment to any patient presenting to the ED, regardless of ability to pay.
Question 3: What is the role of a sentinel event policy in a hospital's risk management program?
- To track employee vacation time
- To establish a process for reviewing serious unexpected patient harm events (Correct answer)
- To set billing rates for procedures
- To schedule routine equipment maintenance
Correct answer: To establish a process for reviewing serious unexpected patient harm events
A sentinel event policy defines how the organization identifies, investigates, and responds to serious adverse events to prevent recurrence.
Question 4: Which insurance coverage protects hospital board members from personal financial loss arising from governance decisions?
- General liability
- Professional liability
- Directors and officers (D&O) liability (Correct answer)
- Umbrella liability
Correct answer: Directors and officers (D&O) liability
Directors and officers (D&O) liability insurance protects board members from personal liability arising from their governance decisions and fiduciary duties.
Question 5: A hospital implements a patient safety hotline allowing anonymous reporting. This is an example of which risk strategy?
- Risk transfer
- Risk retention
- Risk avoidance
- Risk reduction (Correct answer)
Correct answer: Risk reduction
Anonymous reporting systems are a risk reduction strategy designed to surface near misses and hazards before they cause patient harm.
Question 6: Which concept describes the process of identifying all potential losses to which a healthcare organization is exposed?
- Risk financing
- Risk identification (Correct answer)
- Claims management
- Loss prevention
Correct answer: Risk identification
Risk identification is the systematic process of discovering all potential risks — clinical, operational, financial, and strategic — facing the organization.
Question 7: A patient who is competent refuses a blood transfusion for religious reasons. The care team should:
- Override the refusal to save the patient's life
- Document the refusal and respect the patient's decision (Correct answer)
- Seek an emergency court order immediately
- Transfer the patient without discussion
Correct answer: Document the refusal and respect the patient's decision
Competent adults have the legal and ethical right to refuse medical treatment; the team must document informed refusal and respect the decision.
CPHRM CPHRM Exam 3
A hospital is considering a captive insurance arrangement.
What is the primary advantage of this approach?