Question 1

One cannot rely on worker's compensation to cover your health care needs because it​

Accepted Answer

Worker's compensation only covers injuries and illnesses that are directly related to the job. It does not cover general health care needs or non-work-related injuries or illnesses.

Question 2

In a dual-income household where both employers provide a health care plan,it is important to choose to be covered under the plan that provides ____ and is ____.

Accepted Answer

It is important to choose a plan that provides more protection and is less expensive, as this will offer the best overall value for your money. It is also important to consider factors such as deductibles, copays, and prescription drug coverage when choosing a health care plan.

Question 3

Long-term custodial care is not covered by health insurance because the care is​

Accepted Answer

Long-term custodial care is not covered by health insurance because it is not considered medically necessary. While it can be very expensive, that is not the only reason it is not covered by insurance. Additionally, the fact that it is provided by nonlicensed practitioners is not a determining factor in insurance coverage.

Question 4

In what way(s)can health care costs potentially provide an income tax benefit?​

Accepted Answer

All of these options can potentially provide an income tax benefit. Employers may offer a flexible spending arrangement (FSA) for employees to set aside pre-tax dollars for health care expenses. Itemizing deductions on tax returns allows for certain health care expenses to be deducted, including medical and dental expenses that exceed a certain percentage of income. Self-employed individuals may be able to deduct a portion of their health insurance premiums as a business expense.

Question 5

Gary contributes $200 a month to a flexible spending arrangement for health care.If Gary is in the 25 percent marginal tax bracket,which of the following is true?

Accepted Answer

Flexible spending arrangements allow employees to contribute pre-tax dollars, which means that the contribution is subtracted from the employee's salary before taxes are applied. Therefore, Gary's taxable income is reduced by $2,400 (12 months * $200) due to his contribution to the flexible spending arrangement. Since Gary is in the 25 percent marginal tax bracket, he will save $600 (25 percent of $2,400) in federal income taxes. The other options are incorrect. Option A is too high because it assumes that Gary's entire income is subject to the 25 percent tax rate, which is not the case. Option B does not take into account the fact that the contribution is pre-tax. Option C is incorrect because flexible spending arrangements are not itemized deductions but rather a tax-free benefit.

Question 6

A person who wants to continue health insurance coverage through your COBRA rights must​

Accepted Answer

COBRA allows individuals to continue their health insurance coverage after losing their job or experiencing a reduction in work hours. They must pay the full premium cost plus a 2 percent administrative fee. There is no requirement for a six-month waiting period, a minimum coverage period of 18 months, or a 30-day application window; however, there is a specific time frame to elect COBRA coverage, which is typically 60 days from the loss of coverage or the date the COBRA election notice is provided, not 30 days.

Question 7

Eligibility for which of the following is based on household income and net worth?

Accepted Answer

Medicaid eligibility is based on household income and net worth. Social Security Disability Income Insurance is based on disability status, not income or net worth. Medicare eligibility is based on age and/or disability status, not income or net worth. Long-term care insurance eligibility is based on health status and age, not income or net worth.

Question 8

As a result of federal legislation,persons who are no longer part of their group for medical insurance purposes because of being laid off or other reasons must be allowed to continue the group health insurance coverage

Accepted Answer

Federal legislation known as COBRA (Consolidated Omnibus Budget Reconciliation Act) requires employers with 20 or more employees to allow their laid-off, retired, or otherwise terminated employees to continue their group health insurance coverage for a limited period of time, typically 18-36 months. The cost of COBRA coverage may be expensive, as the employee is responsible for paying the full premium plus a 2% administrative fee. The continuation of this coverage is not dependent on the health status of the individual, nor is the employer required to be willing to provide it.

Question 9

Lyle's health care plan will pay 75 percent of all covered expenses over the first $500 per year.This policy contains​

Accepted Answer

The plan has a deductible of $500 and then pays 75% of all covered expenses, which is known as coinsurance. There is no mention of policy limits or copayments.

Question 10

Reimbursement for costs associated with intermediate and custodial care in a nursing facility or at home is provided by​

Accepted Answer

Medicare only covers skilled nursing care for a limited time and is not intended for long-term care or custodial care. Disability income insurance typically replaces lost income in case of a disability and does not provide coverage for long-term care expenses. HMOs may provide some coverage for long-term care, but it varies by plan. Long-term care insurance is specifically designed to cover the costs associated with intermediate and custodial care in a nursing facility or at home, making it the best option for this type of care.

Question 11

James was injured in a freak accident in his dorm room and had to spend several days in the hospital.His covered medical costs totaled $8,000.How much will James's health insurance policy pay for this claim given the following policy information?
​
$400 deductible per year
80/20 coinsurance
$2,000 per year out-of-pocket coinsurance cap

Accepted Answer

First, James will have to meet his $400 deductible. This leaves $7,600 for his insurance policy to cover.

Then, his policy has an 80/20 coinsurance, which means his insurance will cover 80% of the remaining $7,600 and James will be responsible for 20%.

The total amount his insurance will cover is: 
$7,600 x 80% = $6,080

Finally, his policy has an out-of-pocket coinsurance cap of $2,000 per year. Since James has already met his deductible, the $400 will count towards his out-of-pocket maximum. James will be responsible for the remaining $1,520 (20% of $7,600 - $400 deductible) and his insurance will cover the rest up to the $2,000 out-of-pocket maximum.

Therefore, based on his policy information, James's health insurance policy will pay $6,080 for this claim.

Question 12

Your health insurance requires that you pay $50 each time you visit the doctor's office and $15 for each prescription drug.This is an example of​

Accepted Answer

This is an example of a copayment as it is a fixed amount that the insured individual is required to pay out-of-pocket for a specific service or medication.

Question 13

Persons who have a high-deductible health plan can make tax-sheltered deposits into an investment account called a _______ from which they can pay medical expenses.

Accepted Answer

The investment account described is a health savings account (HSA). Option A is not a commonly used term, Option C typically refers to a retirement savings account, and Option D is not a type of account at all.

Question 14

Lance,a volunteer baseball coach,was hit by a hard line drive.As a result of the injury,Lance was taken to the emergency room for treatment and admitted to the hospital.Lance's covered expenses totaled $4,000.How much of the $4,000 will Lance have to pay if these are his first medical expenses of the year and he has the following health insurance coverage?
​
$500 deductible per year
80/20 coinsurance
$1,000 per year out-of-pocket coinsurance cap

Accepted Answer

The answer of Lance,a volunteer baseball coach,was hit by a...

Question 15

An alternative name for traditional health insurance is a(n)​

Accepted Answer

The answer of An alternative name for traditional health insurance...

Question 16

The maximum annual deposit into a health savings account is ____ for an individual and ____ for a family.

Accepted Answer

The maximum annual deposit into a health savings account for an individual is $3,300 and for a family is $6,550. Option A and B are not correct as they have outdated information and Option D is incorrect as the maximum annual deposit for a family is not $10,000, it is $6,550. Therefore, the correct answer is Choice C.

Question 17

Traditional health insurance provides protection against direct medical expenses and,thus,does not cover​

Accepted Answer

Traditional health insurance only covers direct medical expenses such as doctor visits, hospitalization, and medications. It does not provide coverage for lost income when an individual is unable to work due to illness or injury. This type of coverage is typically provided through disability insurance or workers' compensation insurance.

Question 18

To qualify as a high-deductible health care plan,the deductible must be at least

Accepted Answer

According to the IRS, to qualify as a high-deductible health care plan for 2021, the deductible for an individual must be at least $1,400 and for a family, it must be at least $2,800. Therefore, option B, which is $1,000, is the closest option to the minimum requirement. The other options are significantly higher than the required minimum deductible.

Question 19

Kim was injured in a freak accident in her dorm room and had to spend several days in the hospital.Her covered medical costs totaled $14,000.How much will Kim's health insurance policy pay for this claim given the following policy information?
​
$250 deductible per year
80/20 coinsurance
$1,500 per year out-of-pocket coinsurance cap

Accepted Answer

Kim's out-of-pocket costs for the year will be $1,500 (the out-of-pocket cap), plus her $250 deductible, for a total of $1,750.

Her coinsurance portion of the medical costs will be 20%, since her health insurance policy covers 80% of costs after the deductible.

So, Kim's coinsurance portion will be $14,000 x 0.20 = $2,800.

Since Kim has an out-of-pocket cap of $1,500, her health insurance policy will pay the remaining amount of $1,300 ($2,800 - $1,500).

Therefore, total amount paid by Kim's health insurance policy will be $14,000 - $250 (deductible) - $1,300 (coinsurance covered after out-of-pocket max) = $12,250.

Question 20

Traditional health insurance plans typically have ____ and ____ requirements that result in out-of-pocket costs for the insured.

Accepted Answer

Deductibles and coinsurance are common requirements in traditional health insurance plans that require the insured to pay out-of-pocket costs before the insurance company covers the full medical expenses. Medicare, Medicaid, HMOs, PPOs, POS, and PSN are all different types of health insurance plans and not related to the question.

Quiz 11: Managing Health Expenses

One cannot rely on worker's compensation to cover your health care needs because it

In a dual-income household where both employers provide a health care plan,it is important to choose to be covered under the plan that provides and is .

Long-term custodial care is not covered by health insurance because the care is

In what way(s) can health care costs potentially provide an income tax benefit?

Gary contributes $200 a month to a flexible spending arrangement for health care.If Gary is in the 25 percent marginal tax bracket,which of the following is true?

A person who wants to continue health insurance coverage through your COBRA rights must

Eligibility for which of the following is based on household income and net worth?

As a result of federal legislation,persons who are no longer part of their group for medical insurance purposes because of being laid off or other reasons must be allowed to continue the group health insurance coverage

Lyle's health care plan will pay 75 percent of all covered expenses over the first $500 per year.This policy contains

Reimbursement for costs associated with intermediate and custodial care in a nursing facility or at home is provided by

Your health insurance requires that you pay $50 each time you visit the doctor's office and $15 for each prescription drug.This is an example of

Persons who have a high-deductible health plan can make tax-sheltered deposits into an investment account called a _______ from which they can pay medical expenses.

An alternative name for traditional health insurance is a(n)

The maximum annual deposit into a health savings account is for an individual and for a family.

Traditional health insurance provides protection against direct medical expenses and,thus,does not cover

To qualify as a high-deductible health care plan,the deductible must be at least

Traditional health insurance plans typically have and requirements that result in out-of-pocket costs for the insured.

Quiz 11: Managing Health Expenses

One cannot rely on worker's compensation to cover your health care needs because it​

In a dual-income household where both employers provide a health care plan,it is important to choose to be covered under the plan that provides ____ and is ____.

Long-term custodial care is not covered by health insurance because the care is​

In what way(s) can health care costs potentially provide an income tax benefit?​

Gary contributes $200 a month to a flexible spending arrangement for health care.If Gary is in the 25 percent marginal tax bracket,which of the following is true?

A person who wants to continue health insurance coverage through your COBRA rights must​

Eligibility for which of the following is based on household income and net worth?

As a result of federal legislation,persons who are no longer part of their group for medical insurance purposes because of being laid off or other reasons must be allowed to continue the group health insurance coverage

Lyle's health care plan will pay 75 percent of all covered expenses over the first $500 per year.This policy contains​

Reimbursement for costs associated with intermediate and custodial care in a nursing facility or at home is provided by​

Your health insurance requires that you pay $50 each time you visit the doctor's office and $15 for each prescription drug.This is an example of​

Persons who have a high-deductible health plan can make tax-sheltered deposits into an investment account called a _______ from which they can pay medical expenses.

An alternative name for traditional health insurance is a(n) ​

The maximum annual deposit into a health savings account is ____ for an individual and ____ for a family.

Traditional health insurance provides protection against direct medical expenses and,thus,does not cover​

To qualify as a high-deductible health care plan,the deductible must be at least

Traditional health insurance plans typically have ____ and ____ requirements that result in out-of-pocket costs for the insured.

One cannot rely on worker's compensation to cover your health care needs because it

In a dual-income household where both employers provide a health care plan,it is important to choose to be covered under the plan that provides and is .

Long-term custodial care is not covered by health insurance because the care is

In what way(s) can health care costs potentially provide an income tax benefit?

A person who wants to continue health insurance coverage through your COBRA rights must

Lyle's health care plan will pay 75 percent of all covered expenses over the first $500 per year.This policy contains

Reimbursement for costs associated with intermediate and custodial care in a nursing facility or at home is provided by

Your health insurance requires that you pay $50 each time you visit the doctor's office and $15 for each prescription drug.This is an example of

An alternative name for traditional health insurance is a(n)

The maximum annual deposit into a health savings account is for an individual and for a family.

Traditional health insurance provides protection against direct medical expenses and,thus,does not cover

Traditional health insurance plans typically have and requirements that result in out-of-pocket costs for the insured.