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Modeling student knowledge is important for assessment design, adaptive testing, curriculum design, and pedagogical intervention. The assessment design community has primarily focused on continuous latent-skill models with strong conditional independence assumptions among knowledge items, while the prerequisite discovery community has developed many models that aim to exploit the interdependence of discrete knowledge items. This paper attempts to bridge the gap by asking, "When does modeling assessment item interdependence improve predictive accuracy?" A novel adaptive testing evaluation framework is introduced that is amenable to techniques from both communities, and an efficient algorithm, Directed Item-Dependence And Confidence Thresholds (DIDACT), is introduced and compared with an Item-Response-Theory based model on several real and synthetic datasets. Experiments suggest that assessments with closely related questions benefit significantly from modeling item interdependence.