Certified Revenue Cycle Representative (CRCR) Practice Exam

What is an HMO?

1. A system providing comprehensive health services for a monthly fee

2. A network of providers offering different levels of care

3. A group purchasing organization for healthcare supplies

4. A type of insurance that covers specialty services

The correct answer is: A system providing comprehensive health services for a monthly fee

An HMO, or Health Maintenance Organization, is primarily defined as a system that provides comprehensive health services for a monthly fee. This model is structured to deliver coordinated healthcare services to its members, ensuring they receive a variety of necessary medical care, preventive services, and treatments within a defined network of providers. By requiring members to choose a primary care physician (PCP) who coordinates their care, HMOs effectively manage healthcare expenditures and maintain a focus on wellness and preventive care. The other options describe different aspects of healthcare. A network of providers offering varying levels of care does not fully encapsulate the primary function of an HMO, which emphasizes comprehensive and preventive care under a fixed fee structure. A group purchasing organization pertains to the procurement of supplies and services rather than direct patient care, while a type of insurance covering specialty services does not accurately reflect the broad scope of services provided by an HMO, which encompasses preventive and primary care in addition to specialty services.