NEW HERE? LEARN MORE
closeclose
Last visit was: 23 Apr 2024, 12:49 It is currently 23 Apr 2024, 12:49
Decision Tracker
My Rewards
New posts
New comers' posts

Close
GMAT Club Daily Prep
Thank you for using the timer - this advanced tool can estimate your performance and suggest more practice questions. We have subscribed you to Daily Prep Questions via email.

Customized
for You

we will pick new questions that match your level based on your Timer History

Track
Your Progress

every week, we’ll send you an estimated GMAT score based on your performance

Practice
Pays

we will pick new questions that match your level based on your Timer History
Not interested in getting valuable practice questions and articles delivered to your email? No problem, unsubscribe here.
Go to My Error Log Learn more
Close
Request Expert Reply
Confirm Cancel

A major health insurance company in Lagolia pays for special procedure

SORT BY:
Date
Kudos
Tags:
Difficulty: Sub 505 Levelx   Strengthenx                                 
Find Similar Topics 
Show Tags
Hide Tags
User avatar
B
dentobizz
Retired Moderator
Joined: 23 Jul 2010
Posts: 404
Own Kudos [?]: 1832 [51]
Given Kudos: 370
GPA: 3.5
WE:Business Development (Health Care)
Send PM
GMAT ToolKit User
A major health insurance company in Lagolia pays for special procedure [#permalink] New post   Updated on: 04 Oct 2023, 12:02
16
Kudos
35
Bookmarks
00:00
A
B
C
D
E

Difficulty:

5% (low)

Question Stats:

92% (01:37) correct 8% (02:04) wrong based on 4799 sessions
Hide Show timer Statistics
A major health insurance company in Lagolia pays for special procedures prescribed by physicians only if the procedure is first approved as “medically necessary” by a company-appointed review panel. The rule is intended to save the company the money it might otherwise spend on medically unnecessary procedures. The company has recently announced that in order to reduce its costs, it will abandon this rule.

Which of the following, if true, provides the strongest justification for the company’s decision?

(A) Patients often register dissatisfaction with physicians who prescribe nothing for their ailments.

(B) Physicians often prescribe special procedures that are helpful but not altogether necessary for the health of the patient.

(C) The review process is expensive and practically always results in approval of the prescribed procedure.

(D) The company’s review process does not interfere with the prerogative of physicians, in cases where more than one effective procedure is available, to select the one they personally prefer.

(E) The number of members of the company-appointed review panel who review a given procedure depends on the cost of the procedure.
ShowHide Answer
Official Answer
C

Originally posted by dentobizz on 06 Oct 2013, 14:03.
Last edited by Bunuel on 04 Oct 2023, 12:02, edited 3 times in total.
Most Helpful Reply
User avatar
G
mikemcgarry
Magoosh GMAT Instructor
Joined: 28 Dec 2011
Posts: 4448
Own Kudos [?]: 28569 [18]
Given Kudos: 130
Re: A major health insurance company in Lagolia pays for special procedure [#permalink] New post   07 Oct 2013, 14:43
16
Kudos
2
Bookmarks
Expert Reply
dentobizz wrote:
A major health insurance company in Lagolia pays for special procedures prescribed by physicians only if the procedure is first approved as “medically necessary” by a company-appointed review panel. The rule is intended to save the company the money it might otherwise spend on medically unnecessary procedures. The company has recently announced that in order to reduce its costs, it will abandon this rule.

Which of the following, if true, provides the strongest justification for the company’s decision?

(A) Patients often register dissatisfaction with physicians who prescribe nothing for their ailments.
(B) Physicians often prescribe special procedures that are helpful but not altogether necessary for the health of the patient.
(C) The review process is expensive and practically always results in approval of the prescribed procedure.
(D) The company’s review process does not interfere with the prerogative of physicians, in cases where more than one effective procedure is available, to select the one they personally prefer.
(E) The number of members of the company-appointed review panel who review a given procedure depends on the cost of the procedure.

Dear dentobizz,
I'm happy to help with this. :-)

Once you learn to see through trap-answers typical of the GMAT CR, the task becomes much easier. We are given some big hints in the passage --- the rule was "intended to save the company the money" and, later, the company got rid of the rule "to reduce its costs." This means we are looking for what about the review process was costing money, such that eliminating it would save money? That's the crucial issue. This question contains all kinds of other juicy reasons we might have a negative opinion about the rule (overall patient well-being, doctor autonomy, etc.), but all of those will be strictly irrelevant to the economic decision mentioned here.

(A) Patients often register dissatisfaction with physicians who prescribe nothing for their ailments.
A humanitarian concern, but irrelevant to the economic argument ---- doesn't save the company money.

(B) Physicians often prescribe special procedures that are helpful but not altogether necessary for the health of the patient.
A humanitarian concern, but irrelevant to the economic argument ---- doesn't save the company money, because those procedures already wouldn't make it past the review board.

(C) The review process is expensive and practically always results in approval of the prescribed procedure.
Ah!! The review process itself costs money, apparently more money than it saves. This is very promising.

(D) The company’s review process does not interfere with the prerogative of physicians, in cases where more than one effective procedure is available, to select the one they personally prefer.
A professional concern of doctors, but irrelevant to the economic argument ---- doesn't save the company money.

(E) The number of members of the company-appointed review panel who review a given procedure depends on the cost of the procedure
Does changing the number of people on the review panel change the company's cost of running the review panel?? Maybe, maybe not. (It wouldn't if all the members were volunteers, or paid by the government, or something of that nature.) This could be a strengthener, but we don't know for sure.

(C) is the only clear choice for a strengthener, so it is the only possible choice for the OA.

Here's a blog on GMAT CR strategy:
https://magoosh.com/gmat/2012/save-time- ... questions/

Does all this make sense?
Mike :-)
General Discussion
User avatar
G
rhine29388
Senior Manager
Senior Manager
Joined: 24 Nov 2015
Posts: 408
Own Kudos [?]: 125 [0]
Given Kudos: 231
Location: United States (LA)
Send PM
Reviews Badge
Re: A major health insurance company in Lagolia pays for special procedure [#permalink] New post   11 Apr 2016, 14:14
C is only option that strengthens the given statements and hence is the correct answer
User avatar
G
anothermillenial
Manager
Manager
Joined: 21 Jul 2018
Posts: 153
Own Kudos [?]: 434 [3]
Given Kudos: 80
Location: United States
Concentration: General Management, Social Entrepreneurship
Send PM
Re: A major health insurance company in Lagolia pays for special procedure [#permalink] New post   08 Jun 2019, 10:04
2
Kudos
1
Bookmarks
Quote:
A major health insurance company in Lagolia pays for special procedures prescribed by physicians only if the procedure is first approved as “medically necessary” by a company-appointed review panel. The rule is intended to save the company the money it might otherwise spend on medically unnecessary procedures. The company has recently announced that in order to reduce its costs, it will abandon this rule.

Which of the following, if true, provides the strongest justification for the company’s decision?


In this Strengthen stimulus, we are given some facts:

  • Lagolia’s insurance covers “medically necessary” procedures once approved by a panel. (Sounds like a plan that might cause a lot of animosity…especially if the panel is biased and has either really harsh or really lax rules!)
  • The rule is supposed to save money.
  • The company is abandoning rule to cut costs. (Huh, well that’s weird. I guess the panel IS biased…towards approving all procedures?)

So, to prove the company’s announcement is justified, I supposed we must prove that the panelists are biased towards spending…. or that there are a lot more “medically necessary” procedures now than before the rule? Hm, looks like (C) is in our ballpark.

Quote:
(A) Patients often register dissatisfaction with physicians who prescribe nothing for their ailments.

This answer choice discusses dissatisfaction with physicians, an answer choice that is supremely out of scope.

Quote:
(B) Physicians often prescribe special procedures that are helpful but not altogether necessary for the health of the patient.

Hm, well this is relevant to our argument and it does kind of strengthen justification. But, just because physicans prescribe “not altogether necessary procedures” doesn’t mean the board will approve it? Hold.

Quote:
(C) The review process is expensive and practically always results in approval of the prescribed procedure.

Oh, well this is up our alley! And definitely more relevant than (B). Keep this one.

Quote:
(D) The company’s review process does not interfere with the prerogative of physicians, in cases where more than one effective procedure is available, to select the one they personally prefer.

The freedom of choice for physicians to select procedure type is good, but it doesn’t address the cost that might affect Lagolia.

Quote:
(E) The number of members of the company-appointed review panel who review a given procedure depends on the cost of the procedure.

This choice is some new information that doesn’t support the company’s decision to abandon the plan. Does that mean the review panel gets paid more or less? Does it matter?
User avatar
B
Dinesh654
Manager
Manager
Joined: 08 Jun 2021
Status:In learning mode...
Posts: 156
Own Kudos [?]: 8 [0]
Given Kudos: 217
Location: India
GMAT 1: 600 Q46 V27
Send PM
Reviews Badge
Re: A major health insurance company in Lagolia pays for special procedure [#permalink] New post   28 Jun 2022, 22:58
rhine29388 wrote:
C is only option that strengthens the given statements and hence is the correct answer


ThatDudeKnows AndrewN

Please ignore the quote; my doubt is fresh and is not relevent to the quoted post. I couldn't make a new post because i exhausted my daily limit. :tongue_opt3
So In choice C, I am ok with half part- the process is expensive.
but the later half is- the process is always approved--> that means increased cost and it is in our favour but, what if often they always come under "necessary medical condition" and removing the rule is not a good idea because than even the most important and necessary medical conditions will be eliminated by removing the rule.

or we only care about cost not matter how important or necessary medical the condition is?

I don't completly buy this!
avatar
L
AndrewN
Volunteer Expert
Joined: 16 May 2019
Posts: 3512
Own Kudos [?]: 6856 [1]
Given Kudos: 500
Re: A major health insurance company in Lagolia pays for special procedure [#permalink] New post   29 Jun 2022, 03:45
1
Kudos
Expert Reply
dcoolguy wrote:
ThatDudeKnows AndrewN

Please ignore the quote; my doubt is fresh and is not relevent to the quoted post. I couldn't make a new post because i exhausted my daily limit. :tongue_opt3
So In choice C, I am ok with half part- the process is expensive.
but the later half is- the process is always approved--> that means increased cost and it is in our favour but, what if often they always come under "necessary medical condition" and removing the rule is not a good idea because than even the most important and necessary medical conditions will be eliminated by removing the rule.

or we only care about cost not matter how important or necessary medical the condition is?

I don't completly buy this!

Hello, dcoolguy. I did not know there was a limit to daily posting. I am not sure I have ever gone beyond seven or eight posts, but ThatDudeKnows might have more knowledge of the matter.

Regarding your query, I think you are jumping to the conclusion that just because the review panel will be dissolved, the previously approved procedures will no longer be approved. We have no reason to believe that this scenario will play out. The answer choice tells us that a medically prescribed procedure practically always results in approval, so the insurance company might feel as though it could still approve the procedures, those deemed "medically necessary," without going to the trouble and expense of setting up a review panel. There is little more to consider, in keeping with GMAT™ straight-arrow logic. As much as possible, stick to what is on the screen, without making judgments about what will come to pass if, as in this question, a plan is implemented.

Thank you for thinking to ask.

- Andrew
User avatar
G
ThatDudeKnows
Tutor
Joined: 11 May 2022
Posts: 1092
Own Kudos [?]: 695 [1]
Given Kudos: 81
Send PM
Re: A major health insurance company in Lagolia pays for special procedure [#permalink] New post   29 Jun 2022, 07:15
1
Kudos
Expert Reply
dcoolguy wrote:
rhine29388 wrote:
C is only option that strengthens the given statements and hence is the correct answer


ThatDudeKnows AndrewN

Please ignore the quote; my doubt is fresh and is not relevent to the quoted post. I couldn't make a new post because i exhausted my daily limit. :tongue_opt3
So In choice C, I am ok with half part- the process is expensive.
but the later half is- the process is always approved--> that means increased cost and it is in our favour but, what if often they always come under "necessary medical condition" and removing the rule is not a good idea because than even the most important and necessary medical conditions will be eliminated by removing the rule.

or we only care about cost not matter how important or necessary medical the condition is?

I don't completly buy this!


dcoolguy

Yeah, I've never made more than a few posts in a day, either! ;) :lol:

Two comments about your analysis:

1. There can be many reasons for thinking a particular course of action is good or bad. Sometimes on the GMAT, the specific focus is stated and sometimes it isn't. In this case, it is: "in order to reduce its costs, it will abandon this rule." When a specific focus is stated, the correct answer choice should deal with that focus and we really don't need to worry about other aspects of the decision. If no specific focus is stated, that's when we want to look for other reasons.

2. I agree with Andrew that it seems that you jumped to a conclusion that the procedures will no longer be approved, but I think the more logical way to read the argument is to assume that they are just removing that step in the approval process so now it will be EASIER to get procedures approved since the review committee hurdle is no longer there. Yes, this will result in perhaps a few more procedures and that will cost money, but the language of the argument makes it clear that the number of procedures won't go up dramatically and we will be able to remove from our accounting ledger all the cost associated with the review committee. That's a good trade off in terms of reducing costs, which, as in point 1, is the specific focus.
User avatar
B
stackskillz
Manager
Manager
Joined: 28 Feb 2022
Posts: 63
Own Kudos [?]: 5 [1]
Given Kudos: 163
Send PM
Re: A major health insurance company in Lagolia pays for special procedure [#permalink] New post   21 Mar 2024, 13:34
1
Kudos
Plan: The company has recently announced that in order to reduce its costs, it will abandon the rule.

(A) Patients often register dissatisfaction with physicians who prescribe nothing for their ailments - This tells us that patients are upfront in registering their dissatisfaction with physicians who don't prescribe anything to help with the ailments. However, this doesn't answer why the insurance company is discarding the rule it created which should prevent paying for medically unnecessary procedures. Drop

(B) Physicians often prescribe special procedures that are helpful but not altogether necessary for the health of the patient. The exact situation that the insurance company is trying to avoid. This seems to explain why the company initially required procedures to be reviewed, but doesn't explain why it's abandoning the rule now. Drop

(C) The review process is expensive and practically always results in approval of the prescribed procedure. - Fills in the gap. This strengthens the passage above. Keep

(D) The company’s review process does not interfere with the prerogative of physicians, in cases where more than one effective procedure is available, to select the one they personally prefer. This option suggests that the review process doesn't interfere with the physicians choice of treatment method. However, the scope of the argument requires support for the abandoning of the review process. This statement is not relevant. Drop

(E) The number of members of the company-appointed review panel who review a given procedure depends on the cost of the procedure. So higher the cost, more no. of reviewers on the panel. Not releveant to the conclusion - Drop
GMAT Club Bot
gmatclubot
Re: A major health insurance company in Lagolia pays for special procedure [#permalink]
21 Mar 2024, 13:34
Moderators:
GMATNinja
GMAT Club Verbal Expert
6917 posts
GMATNinjaTwo
GMAT Club Verbal Expert
238 posts
mysterymanrog
CR Forum Moderator
832 posts

Powered by phpBB © phpBB Group | Emoji artwork provided by EmojiOne
Main navigation
GMAT Resources
Partners
MBA Resources
www.gmac.com|www.mba.com | | GMAT Club Rules | Terms and Conditions