Employee Benefits Planning

Medicare Part B covers _______% of medical services after the individual pays the $ _______ Deductible? 100%, $80 (2007) 80%, $500 (2007) 50%, $100 (2007) 80% $162 (2011)

80%, $162 (2011)

Benefit objectives should be determined by which of the following? a. The Accounting Department b. The union(s) representing a firm's employees c. A firm's board of directors or owner d. The federal government

A firm's board of directors or owner

Which of the following statements concerning Social Security disability benefits is correct? a. There is a one-year waiting period before benefits are payable. b. Benefits are payable as long as the disabled worker is unable to perform his or her regular occupation. c. Benefits are payable only if the condition causing the disability is expected to result in death prior to age 65. d. In addition to the worker's disability benefits, benefits can be paid to eligible dependents.

Benefits are payable as long as the disabled worker is unable to perform his or her regular occupation.

Which of the following is a distinguishing characteristic of social insurance programs? Total employee financing. Benefits prescribed by law. Benefits based upon need. Emphasis on individual equity.

Benefits prescribed by law.

The Social Security act was enacted for all BUT one of the following reasons: a. Income discontinuity during The Great Depression. b. Addressed retirement income, health and welfare issues of employees and their families. Designed to protect disabled workers who were unable to work as a result of serious mental impairment that lasted at least 12 months. Used to stimulate the economy following The Great Depression.

Designed to protect disabled workers who were unable to work as a result of serious mental impairment that lasted at least 12 months.

Which of the following medical expenses is covered under Part B of Medicare? a. Diagnostic tests b. Custodial nursing care c. Hearing exams and hearing aids d. All drugs that can be self-administered.

Diagnostic tests

Workers' compensation benefits are usually financed by: a. Employee contributions. b. Employer premiums. c. State tax revenue. d. Federal tax revenue.

Employer premiums.

Death claims that are filed under the workers' compensation program must be caused by a compensable injury or an occupational disease.

False

Individuals at least 65, who have earned 40 quarters of coverage, are eligible for Medicare benefits.

False

OASDI under the Social Security Program stands for Old Age, Survivor, and Disease Insurance.

False

Under workers' compensation, rehabilitative services cover physical but not vocational (re-training) rehabilitation.

False

Worker's compensation disability income is awarded depending on whether the disability is total or partial and permanent or temporary.

True

Which of the following is most likely to be a condition that will result in the payment of unemployment compensation benefits? a. Unemployment because of a labor dispute. b. Unemployment as a result of voluntarily leaving a job without good cause. c. Unemployment due to adverse economic conditions. d. Unemployment resulting from discharge due to misconduct.

Unemployment due to adverse economic conditions.

Which of the following benefits are not included in the Social Security Program? a. Retirement Benefits b. Vacation Benefits c. Disability Benefits d. Survivor Benefits

Vacation Benefits

Part D of the Medicare Program is a mandatory prescription drug plan that is available to all Medicare Beneficiaries entitled to Part A and enrolled in Part B.

False

Social Security Old-Age Benefits are designed to incent workers to retire early.

False

The Social Security Act of 1965 set up a federally system of income benefits for retired workers and unemployment insurance for displaced workers.

False

The Social Security Program permits the accrual of up to 10 quarters of coverage to be earned in a single year.

False

Two methods for controlling employee benefit costs are the use of probationary periods and the offering of contributory benefit plans.

True

Employment eligibility criteria as defined by unemployment insurance includes all but the following: a. Capacity to work and availability for work. b. Actively seeking suitable work. c. A waiting period, usually six weeks; the time period the state needs to process the claim. d. Minimum earning and employment requirements.

A waiting period, usually six weeks; the time period the state needs to process the claim.

Under a worker's Primary Insurance Amount (PIA) through Social Security, benefit amounts paid to the family members are based on this calculation and is limited to a maximum of $225.

False

Unemployment Insurance Benefits are received free of income tax.

False

Worker's Compensation Benefits are taxed as income.

False

Workers Compensation Premiums are paid for by the employee.

False

All the following are typically included in a "narrow" definition of employee benefits EXCEPT: Group life insurance. Pension plans. Educational expense allowances. hort-term disability benefits.

Group Life Insurance

Which of the following statements concerning Part A of Medicare is incorrect? a. Inpatient hospital care is subject to an initial deductible for each benefit period. b. Hospice benefits may be elected in lieu of inpatient hospital benefits. c. Inpatient hospital care is paid in full after the 60th day of hospitalization. d. Inpatient care in a skilled-nursing facility is available after a patient has been hospitalized for at least 3 days.

Inpatient hospital care is subject to an initial deductible for each benefit period.

Which of the following statements concerning benefits under workers' compensation laws is incorrect? a. Rehabilitation benefits are available to restore disabled workers to productive employment. b. Medical benefits are usually subject to deductibles and coinsurance. c. Burial benefits and cash income payments are available to eligible survivors if a worker is killed on the job. d. Disability benefits are frequently paid retroactive to the date of injury if a worker is still disabled after satisfying a waiting period.

Medical benefits are usually subject to deductibles and coinsurance.

Which of the following statements concerning unemployment insurance benefits is correct? a. Benefits are a flat amount regardless of worker's wages. b. Because of federal legislation, the maximum benefit is the same in all states. Most states pay regular benefits for a maximum duration of 26 weeks. Extended benefits are paid by the federal government for up to 10 years after worker's regular benefits are exhausted.

Most states pay regular benefits for a maximum duration of 26 weeks.

Which of the following is not an objective for an employee benefits program? Maintain the same level of benefits between union and non-union employees. Maintain or exceed the same benefit program offerings as competitive companies. Offer benefits programs that will exclude females and minorities. Maintain continual communication of benefit offerings across company lines.

Offer benefits programs that will exclude females and minorities.

The traditional ways of determining employees' benefit needs include all but the following: Design the plan based on what the Occupational Safety and Health Department perceives what the employees' needs are. Survey the employees to ask what their needs are. Duplicate the competition's benefit plan. Pattern the non-union benefit offerings after the collective bargaining agreement's benefits package.

Pattern the non-union benefit offerings after the collective bargaining agreement's benefits package.

All of the following are reasons for social insurance programs EXCEPT to: a. Solve major social problems. b. Provide a base of economic security. c. Provide coverage for perils that are difficult to insure in the private sector. d. Provide competition to the private insurance industry.

Provide competition to the private insurance industry.

All of the following are traditional reasons for having different benefit plans for different groups of employees EXCEPT to: a. Meet government regulations. b. Provide different benefits for non-union and union employees. c. Be competitive by providing different benefits in different geographic regions. d. Provide supplemental benefits to top management.

Provide supplemental benefits to top management.

Which of the following statements concerning the financing of Social Security and Medicare is incorrect? a. Payroll taxes are deposited into trust funds from which benefits and administrative costs are paid. b. The tax rate for self-employed persons is one-half of the combined tax rate for employees and employers. c. The earnings base on which taxes are paid will increase based on changes in average wages in the national economy, d. A system of partial advance funding is used.

The earnings base on which taxes are paid will increase based on changes in average wages in the national economy

Which of the following statements concerning the financing of unemployment insurance benefits is incorrect? a. Most state programs are financed primarily by payroll taxes paid by employee. b. The tax rate for a given employer may be reduced if the employer has a stable employment record. Contributions from a state program are deposited into the state's account in a federal trust fund from which benefits are paid. Federal /funds are available to states to provide additional benefits during times of high unemployment.

The tax rate for a given employer may be reduced if the employer has a stable employment record.

To be eligible for Social Security Disability Benefits, a worker must meet all BUT which of the following? a. The worker will be subject to a waiting period of up to 6 months. The medical or mental impairment must last a minimum of 12 months or to be expected to result in death. The worker's disability must meet the definition of a disability under the law. The worker must be at least age 40 in order to collect Social Security Disability Benefits.

The worker must be at least age 40 in order to collect Social Security Disability Benefits.

An employee's contribution to FICA is taxed based on earnings.

True

An objective of an employee benefits plan would be to coordinate all benefits with social insurance programs to which the company makes payments.

True

An objective of most benefit plans is to meet the "needs" of employees.

True

ERISA requires that employers disclose detailed benefits information to their employees through either a manual or electronic Summary Plan Description.

True

Employer contributions to Social Security and Medicare Programs are tax deductible for federal income tax purposes.

True

FICA requires only employer contributions.

True

Legally-required benefits are considered a form of social insurance.

True

Medicare Part C (Called Medicare + Choice/Medicare Advantage), was designed to offer choices through several alternatives to Part A and B, including HMO and PPO choices.

True

Medicare Part C is offered as a fee-for-service plan, managed care plan, or medical savings account.

True

Reasons for the growth of group insurance include the influence of organized labor and legislation that mandates benefits.

True

Social Security Credits accumulate for only the first ten years of an employee's work history.

True

There is no coverage under Medicare Part A for the services of physicians or surgeons.

True

Total compensation strategies require using compensation and employee benefits to support human resource and competitive strategies.

True

Voluntary leaving a job without good cause usually disqualifies workers from receiving benefits.

True

Well-designed employee benefits are a central strategy in attracting and retaining employees.

True