AHIP Health Plan Finance and Risk Management AHM-520 Question # 71 Topic 1 Discussion

AHIP Health Plan Finance and Risk Management AHM-520 Question # 71 Topic 1 Discussion

AHM-520 Exam Topic 1 Question 71 Discussion:
Question #: 71
Topic #: 1

An actuary for the Noble Health Plan observed that the plan's actual morbidity was lower than its assumed morbidity and that the plan's actual administrative expenses were higher than its assumed administrative expenses. In this situation, Noble's actual underwriting margin was


A.

larger than its assumed underwriting margin, and the plan's actual expense margin was higher than its assumed expense margin


B.

larger than its assumed underwriting margin, but the plan's actual expense margin was lower than its assumed expense margin


C.

smaller than its assumed underwriting margin, but the plan's actual expense margin was higher than its assumed expense margin


D.

smaller than its assumed underwriting margin, and the plan's actual expense margin was lower than its assumed expense margin


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