Deck 9: Health and Disability Income Insurance

Question 1

A deductible is the amount you must pay before benefits become payable by the insurance company.

Answer 1

True

Question 2

A PPO is another name for an HMO.

Answer 2

False

Question 3

The benefit limits provision identifies the minimum benefits that will be paid for days spent in the hospital.

Answer 3

False

Question 4

If you choose a Medicare Advantage Plan (Part C),you will not need the original Medicare plan (Parts A and B).

Question 5

With a guaranteed renewable health insurance policy,the insurer is permitted to raise premiums for all members of a group.

Question 6

All group health insurance plans provide the same level of protection.

Question 7

An employer self-funded health plan requires a low level of financial assets.

Question 8

FSAs and HSAs provide tax advantages for health expenses.

Question 9

Health insurance is a form of protection that eases the financial burden people may experience as a result of someone's death.

Question 10

A health reimbursement account is an employer-funded plan.

Question 11

Long-term care insurance is used to pay for a stay in a nursing home but not for help at home.

Question 12

Surgical expense coverage for health insurance includes surgeon's fees in a doctor's office.

Question 13

Blue Cross and Blue Shield are two types of HMOs.

Question 14

A flexible spending account is funded by an employer.

Question 15

Some policies consider the average fee for a service in a particular geographical area.They then use that amount to set a minimum payment for policyholders.

Question 16

A health insurance policy that pays you back for actual expenses is called a reimbursement policy.

Question 17

The copayment provision deals with the amount that someone will pay for a bill such as 20% coinsurance.

Question 18

A health insurance policy that pays you back for actual expenses is called an indemnity policy.

Question 19

A PPO is a type of managed care plan.

Question 20

COBRA and the Health Insurance Portability and Accountability Act of 1996 have improved health insurance coverage options for individuals and families who may have changed jobs or lost a job.

Question 21

A disability policy with a longer elimination period typically charges lower premiums than a policy with a short elimination period.

Question 22

Which of the following is correct?

A) A premium reimburses you for hospital stays, doctors' visits, and medications.
B) A premium is the amount your employer will pay for your health insurance coverage.
C) Disability income insurance pays actual medical costs.
D) Medical expense insurance provides payments to make up for income of a person who cannot work as a result of injury or illness.
E) Medical expense plans may reimburse an individual for hospital stays, doctors' visits, and medications.

Question 23

Medicare typically covers routine checkups.

Question 24

Everyone qualifies for COBRA.

Question 25

Most people receive health insurance from

A) Individual plans.
B) Their bank or lending institution.
C) A plan offered by their employer.
D) COBRA.
E) None of these-most do not have health insurance coverage.

Question 26

Administrative costs in the United States consume half of the health care dollars.spent.

Question 27

Disability income insurance policies are required to provide benefits for disabled policyholders until age 65.

Question 28

Medicare is offered to certain low-income individuals and families.

Question 29

Disability income insurance covers your medical expenses when you are disabled.

Question 30

A good disability income insurance plan will provide benefits if you cannot work at any job.

Question 31

The period before you can receive benefits in a disability plan is called the probationary period.

Question 32

The Health Insurance and the Patient Protection and Affordable Care Act of 2010 requires health insurance companies to submit justification for all requested premium increases.

Question 33

Health care costs have decreased because of aging baby boomers using fewer health care services.

Question 34

The United States has the fifth highest per capita medical expenditures in the world.

Question 35

The financial problems caused by death are greater than those caused by disability.

Question 36

Coordination of benefits (COB)applies to

A) Combining health insurance and disability insurance coverage.
B) Combining all group and individual insurance coverages.
C) Combining the Health Insurance Portability and Accountability Act of 1996 and COBRA.
D) Combining three or more disability policies issued for an individual.
E) Combining the benefits of two insurance policies issued for a married couple.

Question 37

The Health Insurance Portability and Accountability Act of 1996

A) Sets federal standards to ensure that workers do not lose their health insurance if they change jobs.
B) Sets state standards to ensure that workers do not lose their health insurance if they change jobs.
C) Applies to individual health insurance policies.
D) Prevents employees from moving from one group health plan to another without a lapse in coverage.
E) Is an update of the Consolidated Omnibus Budget Reconciliation Act of 1986.

Question 38

A summary plan description outlines the disadvantages of your health plan along with your legal rights under the Employment Retirement Income Security Act.

Question 39

The definition of disability is stricter for Social Security than for employer plans.

Question 40

What is the primary purpose of medical expense insurance?

A) Protect against death expenses.
B) Provide payments to make up for some income of a person who cannot work as a result of injury or illness.
C) Pay actual medical costs for illness or injury.
D) Pay a salary if an employee is disabled.
E) Repay loans if an employee cannot work because of illness or injury.

Question 41

A health insurance policy with this provision lists coverage in terms of services,not dollar amounts.

A) Assigned benefits
B) Benefit limits
C) Exclusions and limitations
D) Internal limits
E) Service benefits

Question 42

The type of health insurance coverage that pays for some or all of the daily costs of room and board during a hospital stay is

A) Dental expense.
B) Surgical expense.
C) Hospital expense.
D) Physician expense.
E) Major medical expense.

Question 43

The type of health insurance coverage that may specify the maximum payment amount for an operation is

A) Dental expense.
B) Surgical expense.
C) Hospital expense.
D) Physician expense.
E) Major medical expense.

Question 44

Which of the following is TRUE about long-term care insurance?

A) It covers help at home but not in a nursing home.
B) It covers a stay in a nursing home but not help at home.
C) The older you are when you enroll, the higher the annual premium.
D) Insurance plans are sold primarily to individuals in the 20-40 age group.
E) These plans typically pay for all costs.

Question 45

Which of the following about individual health insurance policies is correct?

A) They are used by employees of large organizations.
B) All insurance companies that offer this type of policy are required to charge the same rates.
C) They are primarily for employees of small companies.
D) They are permitted for individuals only, not for families.
E) They are available for the self-employed or others who are dissatisfied with the coverage that their group plan provides.

Question 46

The insurance that helps pay hospital,surgical,medical,and other bills with a low deductible is known as a(n)

A) Basic health insurance policy.
B) Individual policy.
C) Comprehensive major medical policy.
D) Hospital indemnity policy.
E) Dread disease policy.

Question 47

Which of the following about individual health insurance policies is NOT correct?

A) They can cover individuals.
B) They are used by the self-employed.
C) They can provide family coverage.
D) All insurance companies that offer this type of policy are required to charge the same rates.
E) They can be purchased directly from the company of your choice.

Question 48

Nancy is studying the health insurance plan options offered by her employer.She wants a policy that will have the insurance pay a percentage of her medical expenses after she meets her deductible.She should review the

A) Deductible.
B) Coinsurance.
C) Stop-loss provision.
D) Hospital indemnity policy.
E) Dread disease policy.

Question 49

The type of health insurance coverage that may cover routine doctor visits,X-rays,and lab tests is

A) Dental expense.
B) Surgical expense.
C) Hospital expense.
D) Physician expense.
E) Major medical expense.

Question 50

Miguel is concerned that the health insurance option he is considering plays upon unrealistic fears.He is most concerned about a

A) Deductible.
B) Coinsurance.
C) Stop-loss provision.
D) Hospital indemnity policy.
E) Dread disease policy.

Question 51

Which of the following is NOT a type of health insurance available to individuals or employees?

A) Dental expense insurance
B) Hospital indemnity policy
C) Dread disease policy
D) Minor medical indemnity insurance
E) Vision care insurance

Question 52

A policy that pays you back for actual expenses is called

A) A coinsurance plan.
B) A reimbursement plan.
C) A deductible plan.
D) An indemnity plan.
E) A reasonable and customary plan.

Question 53

Fran is interested in purchasing health insurance that limits the total out-of-pocket amount that she will have to pay.She should consider a

A) Deductible.
B) Coinsurance.
C) Stop-loss provision.
D) Hospital indemnity policy.
E) Dread disease policy.

Question 54

COBRA stands for

A) Coverage of Benefits Reduction Act.
B) Continuation of Benefits for Retirees Act.
C) Consolidated Omnibus Budget Reconciliation Act.
D) Coverage of Benefits for the Retired Act.
E) Consolidation of Benefit Reapplication Act.

Question 55

Jenny wants health insurance that limits the amount that she must pay before the insurance starts paying benefits.She is concerned about a

A) Deductible.
B) Coinsurance.
C) Vision care policy.
D) Hospital indemnity policy.
E) Dread disease policy.

Question 56

The type of health insurance coverage that takes up where basic health insurance coverage leaves off is

A) Dental expense.
B) Surgical expense.
C) Hospital expense.
D) Physician expense.
E) Major medical expense.

Question 57

This health insurance provision lets your insurer make direct payments to your doctor or hospital.

A) Assigned benefits
B) Benefit limits
C) Exclusions and limitations
D) Internal limits
E) Service benefits

Question 58

What is a typical copayment amount for individuals?

A) $0-5
B) $20-30
C) $35-50
D) $75-100
E) $100-200

Question 59

Which of the following is INCORRECT about dread disease policies?

A) They are illegal in many states.
B) Each policy covers a wide range of conditions.
C) They play upon unrealistic fears.
D) These policies are usually sold through the mail, in newspapers, and magazines, or by door-to-door salespeople.
E) They cover diseases that are already covered if you are insured under a major medical plan.

Question 60

This health insurance provision sets limits on the amount of repayment for certain services.

A) Assigned benefits
B) Copayment
C) Exclusions and limitations
D) Internal limits
E) Service benefits

Question 61

Brittany and Brandon are both charged $250 for an office visit to the same specialist.Brittany's reimbursement policy has a deductible of $300.Once she has met the deductible,the policy will cover the full cost of her visits.Brandon's indemnity policy will pay him $150,the maximum amount his plan provides for a visit to any specialist.Which of the following is correct?

A) Brittany will pay less because the policy will cover up to $300 for her visit.
B) Brittany will pay more because she must pay the entire bill since she has not met her deductible while Brandon will have part of his bill paid by his policy.
C) Brandon will pay $150 and his insurance company will pay $100.
D) Brandon will pay more because Brittany will have the first $300 paid by her policy.
E) None of these is correct.

Question 62

Jack needs comprehensive medical coverage; however,his income is quite low.What plan should he investigate?

A) Medicare Part A
B) Medicare Part B
C) Medicaid
D) Medigap
E) Medicare Part C

Question 63

Which of the following is NOT a private health care plan?

A) Health maintenance organization (HMO)
B) Home health care agency
C) Hospital and medical service plan
D) Medicare
E) Preferred provider organization (PPO)

Question 64

Xavier's employer offers a health plan that stresses preventive services and covers routine immunizations and checkups,screening programs,and diagnostic tests.What kind of plan does his employer offer?

A) Health maintenance organization (HMO)
B) Private insurance company
C) Hospital and medical service plan
D) Medicare
E) Preferred provider organization (PPO)

Question 65

Blue Cross and Blue Shield are

A) Health maintenance organizations (HMO).
B) Private insurance companies.
C) Hospital and medical service plans.
D) Types of Medicare.
E) Preferred provider organizations (PPO).

Question 66

This type of plan combines features of HMOs and PPOs.It uses a network of participating physicians and medical professionals who have contracted to provide services for certain fees.

A) Home health care agency
B) Hospital and medical service plan
C) Medicare
D) Point-of-service plan
E) Private insurance company

Question 67

Which of the following is most likely to use a health maintenance organization?

A) A healthy young adult who travels around the world for his job.
B) A family with teenagers who need annual checkups for sports at school.
C) A neighbor who has seen the same specialists for the last 15 years.
D) A low-income elderly relative.
E) All of these would be likely to use a health maintenance organization.

Question 68

Medicare (Part A)covers

A) Dental care.
B) Routine checkups.
C) Most immunizations.
D) Inpatient hospital care.
E) All of these are covered.

Question 69

Anna contributes pretax dollars to an account managed by her employer for her health care expenses.If she does not spend all of her money by the end of the year,she may forfeit it.What kind of plan does she have?

A) FSA
B) HRA
C) HSA
D) Medicare
E) Self-funded health plan

Question 70

Who is most likely to use a home health care agency?

A) A mother who is looking for a plan to cover immunizations for her children.
B) A healthy young adult.
C) A family with teenagers who need annual check-ups for sports at school.
D) An elderly neighbor.
E) All of these would be likely to use a home health care agency.

Question 71

A Medigap policy fills the gap between medical costs and medical payments from

A) Home health care agencies.
B) Hospital and medical service plans.
C) Medicare.
D) Medicaid.
E) Private insurance companies.

Question 72

A provision in a health insurance policy that will cover only a fixed amount for an expense is called

A) Reimbursement.
B) Out-of-pocket limit.
C) Deductible.
D) Internal limit.
E) Indemnity.

Question 73

Jacob is concerned that his out-of-pocket health care expenses will be quite high,so he is considering adding contributions to a tax-free account that he can use with his high-deductible policy to cover catastrophic expenses.What kind of plan does he have?

A) FSA
B) HRA
C) HSA
D) Medicare
E) Self-funded health plan

Question 74

A quality health insurance plan should do all of the following except

A) Offer basic coverage for hospital and doctor bills.
B) Impose no unreasonable exclusions.
C) Limit out-of-pocket expenses to no more than $3,000 to $5,000 per year.
D) Provide at least 120 days' hospital room and board in full.
E) Provide a lifetime maximum level of coverage of up to $50,000.

Question 75

Individuals over the age of 65 who are eligible for federal government health plan coverage may also be interested in purchasing more coverage called

A)Medicare Part A.
B)Medicare Part B.
C)Medicaid.
D)Medigap.
E)Statewide health coverage.

Question 76

Monica's employer offers a health insurance plan with a very high deductible.In addition,her employer provides a fund for her to spend specifically on health care.What kind of plan does she have?

A) FSA
B) HRA
C) HSA
D) Medicare
E) Self-funded health plan

Question 77

Medicaid covers

A) Lab services.
B) Skilled nursing and home health services.
C) Prescription drugs.
D) Eyeglasses.
E) All of these.

Question 78

Yvonne's employer offers a health plan that has a group of doctors and hospitals that agree to provide specified medical services to members at prearranged fees.This health plan offers some flexibility since members can either visit a physician from a list or go to their own doctors.What kind of plan does her employer offer?

A) Health maintenance organization (HMO)
B) Private insurance company
C) Hospital and medical service plan
D) Medicare
E) Preferred provider organization (PPO)

Question 79

The set amount that you must pay toward medical expenses before the insurance company pays benefits is called

A) Reimbursement.
B) Out-of-pocket limit.
C) Deductible.
D) Internal limit.
E) Indemnity.

Question 80

After you have reached a certain limit that you must pay for the deductible and coinsurance,the insurance company covers 100% of any additional cost.This is called

A) Reimbursement.
B) Out-of-pocket limit.
C) Deductible.
D) Internal limit.
E) Indemnity.