Question 1

This Section of the IRC permits an employer to offer employees the choice between taxable income or to allocate some of their income to purchase qualified benefits through a cafeteria plan. (Cafeteria Plans under Section 125)

Accepted Answer

Section 125 of the Internal Revenue Code (IRC) allows employers to offer their employees a choice between receiving taxable income or allocating a portion of their income to purchase qualified benefits through a cafeteria plan.

Question 2

Flexible spending accounts and premium-only plans are versions of which cafeteria plan? (Pretax Salary Reduction Plans)

Accepted Answer

Flexible spending accounts and premium-only plans are examples of pretax salary reduction plans, which allow employees to set aside a portion of their income before taxes to pay for certain expenses, such as healthcare or dependent care. This reduces their taxable income and therefore reduces their tax liability. Modular plans offer a variety of benefit options to choose from, while core-plus-option plans offer a set of core benefits with additional options to choose from. Mix-and-match plans allow employees to select individual benefits from a menu of options.

Question 3

ERISA requires employers to distribute new summary plan descriptions to the Department of Labor within how many days. (Summary of Plan Description)

Accepted Answer

The answer of ERISA requires employers to distribute new summary...

Question 4

Discuss the concept of "good business sense" of benefits communication. (The "Good Business Sense" of Benefits Communication)

Accepted Answer

The answer of Discuss the concept of "good business sense"...

Question 5

Which of the following is not a feature of prospective reviews or precertification reviews? (Utilization Reviews)

Accepted Answer

Proceeding without a second surgical opinion is not a feature of prospective reviews or precertification reviews (utilization reviews). The other options - verifying a patient's coverage, determining whether the health plan covers the treatment, and judging whether the proposed treatment is medically appropriate - are all features of utilization reviews.

Question 6

Changes in benefits plans must be described and distributed to employees using one of these. (Summary of Material Modification)

Accepted Answer

The Summary of Material Modifications (SMM) must be used to describe and distribute changes in benefit plans to employees. This document provides a summary of any modifications made to the plan and is required under ERISA regulations. Choices A and B are not accurate terms, and choice C does not include the necessary term "modification."

Question 7

ERISA requires that material modification summaries must be sent to the Department of Labor within how many days after the end of the plan year in which the change occurred. (Summary of Material Modification)

Accepted Answer

ERISA requires that a Summary of Material Modification (SMM) must be filed with the Department of Labor within 210 days after the end of the plan year in which the modification occurred.

Question 8

This cafeteria plan allows employees to exclude allocated income from federal income tax to pay for the benefits. (Pretax Salary Reduction Plans)

Accepted Answer

The given cafeteria plan where employees can exclude allocated income from federal income tax to pay for the benefits is known as pretax salary reduction plans. Hence, the correct choice is C. The other options such as core-plus-option plans, modular plans, and mix-and-match plans do not specifically relate to the given scenario.

Question 9

Compare one-size-fits-all benefits with employee choice. (A One-Size-Fits-All Approach,Employer Choice to Customize Benefits)

Accepted Answer

The answer of Compare one-size-fits-all benefits with employee choice. (A...

Question 10

Which of the two factors drive the decision to outsource? (Outsourcing the Benefits Function)

Accepted Answer

Outsourcing decisions are often driven by the complexity of benefit plan administration and the need to reduce workforce size to cut costs and improve efficiency.

Question 11

Under provider payment systems,agreements may include one or more cost saving features.Which of the following is not one of these cost saving features? (Provider Payment Systems)

Accepted Answer

The answer of Under provider payment systems,agreements may include one...

Question 12

Briefly discuss the information that summary plan descriptions must provide. (Summary Plan Description)

Accepted Answer

The answer of Briefly discuss the information that summary plan...

Question 13

Under this provider payment system,managed care plans hold primary care physicians accountable for the cost of services rendered to each assigned patient. (Provider Payment Systems)

Accepted Answer

Full capitation is a payment model where primary care physicians receive a set amount for each enrolled patient regardless of the number of services provided, making them accountable for the cost of services rendered to each patient.

Quiz 10: Managing the Employee-Benefits System