Chapter Exam 5: Medical Expense

A characteristic of preferred provider organization (ppo) would be:

Discounted fees for the patient

Which of the following statements BEST describes the intent of a Coinsurance clause in a Major Medical policy?

Discourages overutilization of the insurance coverage

Generally how long is a benefit period for a major medical expense plan

One year

Which of these options can an individual use their medical flexible spending account to pay for

Prescription Drugs

A Health Reimbursement Arrangement MUST be established:

by the employer

Major Medical policies typically

contain a deductible and coinsurance

J's Major Medical policy has a $2,000 deductible and an 80/20 Coinsurance clause. If J is hospitalized and receives a bill for $10,000, J would pay

$3,600

An insured covered by a group Major Medical plan is hospitalized after sustaining injuries that resulted from an automobile accident. Assuming the plan had a $1,000 deductible and an 80/20 Coinsurance clause, how much will the INSURED be responsible to pay with $11,000 in covered medical expenses?

$3000

C was injured while deep sea diving and requires a hospital stay. C has a Major Medical policy with a 80/20 coinsurance clause and a $400 deductible. What is the MAXIMUM C will pay if the covered medical expenses are $2000?

$720

Which of the following features allows an insured to defer current health charges to the following year's deductible instead of the current year's deductible

Carryover Provision

A Major Medical policy typically contains a provision that requires the insurer to pay only part of a loss, while the balance is paid by the insured. This provision is called

Coinsurance

A prospective insured completes and signs an application for health insurance but intentionally conceals information about pre-existing heart condition. The company issues the policy. Two months later, the insured suffers a heart attack and submits a claim. While processing the claim, the company discovers the pre-existing condition. In this situation, the company will:

Continue coverage but exclude the heart condition

M is insured under a basic Hospital/Surgical Expense policy. A physician performs surgery on M. What determines the claim M is eligible for?

Determined by the terms of policy

This type of deductible provision waives the deductible for all family members after some of them have satisfied individual deductibles within the same year:

Family maximum deductible

Basic Medical Expense insurance:

Has lower benefit limits than Major Medical insurance

For which of the following expenses does a basic hospital policy pay

Hospital room and board

The first portion of a covered Major Medical insurance expense that the insured is required to pay is called the:

Initial deductible

J was reviewing her Health Insurance policy and noticed the phrase "This policy will only pay for a semi-private room". This phrase is considered to be a(n)

Internal limit

In Major Medical Expense policies, what is the objective of a Stop Loss provision?

Limits an insured's out-of-pocket medical expenses

A catastrophic illness would be best covered by which of the following health insurance plans

Major Medical

Which of the following types of health coverage frequently uses a deductible?

Major Medical Policy

Comprehensive Major Medical policies usually combine:

Major Medical with Basic Hospital/Surgical Coverage

Which of the following costs would a Basic Hospital/ Surgical policy likely cover

Surgically removing a facial birthmark

A comprehensive major medical health insurance policy contains an Eligible Expenses provision which identifies the types of health care services that are covered. All of the following health care services are typically covered, EXCEPT for:

experimental and investigative services

A major medical policy typically:

provides benefits for reasonable and necessary medical expenses, subject to policy limits