AAPC-CPCO Certified Professional Compliance Officer - Set 1 - Part 1

Correct Answer: Blue Cross and Blue Shield plan

Blue Cross and Blue Shield plans contracted with healthcare facilities and providers in the community and let members obtain care at any covered site. They were prepaid benefits, one of the two models available after World War II. Option a is incorrect because it charged a set fee per enrollee, who had to receive care from the organization's own in-network facilities and providers, the opposite of open community access. Option b is incorrect because it belongs to the period before the 1900s, when employers such as railroads supplied care through physicians they employed directly. Option d is incorrect because it was a later restructuring of HMOs, not one of the two models available in that period, and it contracted with independent physicians.

Correct Answer: Health Care Financing Administration

The Health Care Financing Administration (HCFA) was established to administer Medicare and Medicaid. It followed the Bureau of Health Insurance, which had been created within the reorganized Social Security Administration to develop health insurance policy. Option b is incorrect because it was created earlier to oversee federal health, education and social insurance bodies, including the Social Security Board, and did not administer Medicare and Medicaid. Option c is incorrect because these were quality oversight bodies expanded by later legislation, so they function as reviewers and not as administrators of the two programs. Option d is incorrect because it housed Medicaid for a time, but it was not the single agency set up to administer both programs.

Correct Answer: Federal Security Agency

The Federal Security Agency was created to administer federal organizations dealing with health, education and social insurance. Those organizations included the Social Security Board, the Public Health Service, and the Office of Education. Option a is incorrect because it was established during the Medicare-era reorganization with responsibility for health insurance policy development, which is a narrower role than administering several separate federal organizations. Option c is incorrect because at the time Medicare was enacted, Medicaid sat inside this service, so its role was a program home rather than oversight of those organizations. Option d is incorrect because it was reorganized later to implement Medicare, and that reorganization produced a new bureau; it was not the body created to administer those three organizations.

Correct Answer: Health Insurance Portability and Accountability Act

HIPAA created national administrative simplification standards for electronic health care transactions. It also amended federal law to improve portability of coverage, and it required HHS to issue privacy regulations if Congress did not act. Option a is incorrect because it made it easier for HMOs to contract with Medicare on a full risk basis and expanded Peer Review Organization oversight. Option b is incorrect because it created the Children's Health Insurance Program and new Medicare prospective payment systems, not national standards for electronic transactions or portability of coverage. Option c is incorrect because it set up a voluntary reporting system for patient safety data and lets HHS impose civil money penalties, which is a different purpose.

Correct Answer: Children's Health Insurance Program

The Balanced Budget Act created the Children's Health Insurance Program (CHIP). It also revised limits on Medicaid payments to disproportionate share hospitals and set new Medicaid managed care options and requirements for states. Option b is incorrect because it dedicated funding to program integrity activities and let HCFA contract competitively for that work, which has nothing to do with children's coverage. Option c is incorrect because it pays Medicare premiums and cost-sharing charges for beneficiaries with low incomes and resources, and it was established by the Medicare Catastrophic Coverage Act. Option d is incorrect because this benefit gives beneficiaries all-inclusive care for pain relief and symptom management in a home setting, and it predates the Balanced Budget Act.

Correct Answer: Congress

Congress provides oversight of healthcare laws and regulations, while the Department of Health and Human Services provides general oversight regarding health issues and concerns. The question asks for the body overseeing the laws themselves. Option a is incorrect because the DOJ is named as one of the agencies that enforce Medicare fraud and abuse laws, which is enforcement rather than oversight of the laws. Option b is incorrect because CPI promotes Medicare integrity through audits and policy reviews and monitors program vulnerabilities; it does not oversee healthcare laws generally. Option d is incorrect because MACs are review contractors that process claims and enroll providers and suppliers, a claims-processing role far removed from legislative oversight.

Correct Answer: Health Care Fraud and Abuse Control Program

The Health Care Fraud and Abuse Control Program (HCFACP) was developed under the auspices of the OIG and the Department of Justice by HIPAA to coordinate federal, state, and local law enforcement activities addressing health care fraud and abuse. Option a is incorrect because it was created by CMS to collect data on the error rate for claims erroneously paid to providers, not to coordinate law enforcement. Option c is incorrect because it accredits health care organizations meeting quality and safety standards, which is a quality measure and not a law enforcement coordination effort. Option d is incorrect because these are state-run organizations that investigate and prosecute suspected Medicaid fraud, so they work at the state level rather than coordinating all levels.

Correct Answer: HHS Office of Inspector General

CMS guidance states that federal agencies such as the U.S. Department of Justice, HHS, and the HHS Office of Inspector General enforce the Medicare fraud and abuse laws, including the False Claims Act and Anti-Kickback Statute. Option b is incorrect because HRSA directs national health programs that assure equitable access to care and train a health workforce; enforcing fraud and abuse laws is not listed among its roles. Option c is incorrect because AHRQ supports research on health care quality, patient safety, costs, and access, which is a research function rather than fraud and abuse enforcement. Option d is incorrect because OCR is responsible for enforcing HIPAA rules and regulations, so it is not named among the agencies that enforce the Medicare fraud and abuse laws.

Correct Answer: Enrollment

OIG guidance states that preventing unscrupulous providers and suppliers from gaining access to the programs is the first step in an integrated integrity strategy. This matches the Enrollment principle, which scrutinizes applicants before enrollment or reenrollment. Option a is incorrect because it addresses swift reaction to detected fraud, sufficient punishment to deter others, and prompt remedy of vulnerabilities, so it comes after detection rather than first. Option b is incorrect because it concerns establishing payment methodologies that are reasonable and responsive to marketplace and medical practice changes, not screening applicants before they join the programs. Option c is incorrect because it calls for vigilant monitoring of the programs for evidence of fraud, waste, and abuse, which happens after participants are already in the programs.

Correct Answer: Exclude them from all federal health care programs

OIG guidance states that OIG can exclude people and entities who engaged in fraud or abuse from participating in all federal health care programs, and can also impose CMPs for certain violations. Option a is incorrect because claims processing and provider enrollment are roles given to Medicare Administrative Contractors, not an exclusion power that OIG exercises. Option b is incorrect because detecting and collecting overpayments is the work of Recovery Audit Contractors, a review contractor program rather than OIG's exclusion authority. Option d is incorrect because calculating the Medicare FFS improper payment rate belongs to CERT contractors, which review claims to determine whether they were paid properly.

Correct Answer: Self-reporting, cooperation, or acceptance of responsibility

Self-reporting, cooperation, or acceptance of responsibility is one of the two factors that mitigate punishment, together with an effective compliance and ethics program. The four increasing factors are involvement or tolerance, prior history, violation of an order, and obstruction of justice. Option b is incorrect because the guidelines count an organization's earlier record as an aggravating factor, so it is a genuine member of the set named in the stem. Option c is incorrect because the guidelines name it among the four culpability factors that raise punishment, so it belongs to the aggravating set. Option d is incorrect because it is one of the four factors the guidelines list as increasing the ultimate punishment of an organization.

Correct Answer: Offense seriousness and organizational culpability

For an organization not operated primarily for a criminal purpose or by criminal means, the guidelines base the fine range on the seriousness of the offense and the culpability of the organization, the third general principle. Option a is incorrect because remedial resources are treated as a way of making victims whole, not as punishment, so they do not determine the fine range. Option b is incorrect because probation is a separate sanction, used to ensure another sanction is implemented or to reduce future criminal conduct, and does not set the fine range. Option c is incorrect because asset divestiture is the fine approach for an organization operated primarily for a criminal purpose or by criminal means, which is a different category from this one.

Correct Answer: To engage the private health care community in combating fraud and abuse

OIG describes the creation of compliance program guidances as a major initiative to engage the private health care community in combating fraud and abuse, relying on voluntary compliance efforts and internal controls rather than mandates. Option a is incorrect because OIG states that CPGs should not be viewed as exhaustive discussions of beneficial compliance practices or relevant risk areas, which contradicts this claim. Option c is incorrect because the guidance says future CPGs build on the elements of the Federal Sentencing Guidelines, along with policy recommendations and applicable statutes, so they supplement that foundation rather than replace it. Option d is incorrect because OIG guidance describes adoption as voluntary and says the suggestions in CPGs are not mandatory, so a mandatory requirement is not the purpose.

Correct Answer: the states

Beginning with the McCarran-Ferguson Act, states were granted the authority to oversee health insurance related products. States have historically regulated matters such as solvency requirements, provider networks, claim review standards and licensing. Option a is incorrect because lending agencies encouraged clients to obtain health benefits to limit foreclosures, a market influence that carries no authority to regulate insurance products. Option b is incorrect because trade unions offered represented employees financial protection in case of illness or injury, which is a benefit role and not regulatory authority. Option c is incorrect because employers did create early arrangements such as hospital associations, but they were not given oversight authority over insurance products by that Act.

Correct Answer: Greater harm or liability than having no program

OIG hospital guidance states that programs hastily constructed and implemented without appropriate ongoing monitoring will likely be ineffective and could cause greater harm or liability than no program at all, showing the need for genuine commitment. Option a is incorrect because the guidance states that an effective program requires a substantial commitment of time, energy and resources from senior management and the governing body, not less. Option b is incorrect because a program becomes part of the fabric of routine operations only eventually and when effective; a hastily built, unmonitored program does not reach that point. Option d is incorrect because OIG guidance gives no assurance of protection; it warns that hasty programs without monitoring will likely be ineffective rather than shielding the hospital.

Correct Answer: Return of the funds claimed in error

Absent a violation of a civil, criminal or administrative law, erroneous claims caused by honest mistakes or negligence result only in the return of funds claimed in error, without penalties. Option a is incorrect because that act covers only actual knowledge, reckless disregard, or deliberate ignorance of falsity, and it does not reach mistakes, errors, or negligence. Option c is incorrect because this administrative remedy applies the same standard of proof as the False Claims Act, so honest errors without knowledge or recklessness fall outside it. Option d is incorrect because criminal penalties demand an even higher standard, intent to defraud proved beyond a reasonable doubt, which clerical mistakes with no intent clearly cannot satisfy.

Correct Answer: Intent to defraud

The OIG states that for criminal penalties the standard is even higher than the civil standard: criminal intent to defraud must be proved beyond a reasonable doubt. Civil knowledge standards and negligence fall short of it. Option a is incorrect because this describes willfully avoiding the truth about a claim and is enough for civil liability, which makes it a lower threshold than criminal intent. Option b is incorrect because it is one of the knowledge levels the civil False Claims Act already covers, so it sits below the higher criminal standard. Option c is incorrect because the OIG places it outside every penalty framework discussed, so an erroneous claim resting on it leads only to returning the funds.

Correct Answer: A clear "open door" policy

OIG guidance recognizes that small practices need a less formalized process than earlier guidance envisioned, so a clear "open door" policy between physicians, compliance personnel and employees may satisfy the communication element. Option b is incorrect because the guidance presents this as a user-friendly reporting process for larger practices, and notes anonymity may not be feasible in small ones. Option c is incorrect because hotlines are named as a formal, more costly form of communication that OIG recognizes many small practices cannot readily implement. Option d is incorrect because communication with a billing company's compliance contact applies only if a billing company is used, and it coordinates activities rather than replacing practice-wide communication.

Correct Answer: At least annually

OIG's guidance for small entities states that they should conduct at least an annual audit. The risk assessment helps select which claims or areas to audit, and the results show whether issues need to be addressed. Option a is incorrect because the guidance treats high-priority risks that arise outside the annual risk assessment as a reason for additional audits, not as the baseline schedule. Option b is incorrect because a single audit at launch would not let the entity keep checking results and remediation; the guidance calls for a recurring audit. Option c is incorrect because when monitoring reveals a risk indicator, the entity investigates the cause and decides how to address it; that is a response step, not the audit minimum.

Correct Answer: Reviewing claim denials

OIG guidance states that a review of claim denials helps the practice scrutinize a significant risk area and improve its cash flow by submitting correct claims that will be paid the first time they are submitted. Option a is incorrect because OIG guidance presents this as a collaborative option for creating the practice's own version of its policies, not as the activity linked to cash flow. Option c is incorrect because OIG guidance gives this as the response when a practice discovers erroneous claims, a repayment step rather than a review that improves first-time payment. Option d is incorrect because training participation is described as a way to promote compliance without excessive burden or duplicative action, and the guidance does not connect it to claims being paid first time.