Medical Expense Insurance Ch. 3

With a Basic Medical Expense policy, what does the hospitalization expense cover?

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

The phrase "This policy will only pay for a semi-private room" is an example of a(n)

internal limit

All of the following are limited benefit plans EXCEPT

life insurance policies

A major medical policy typically

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

Which of these is NOT a characteristic of a Health Reimbursement Arrangement (HRA)?

Employee funds the HRA entirely

M has a Major Medical insurance policy with a $200 flat deductible and an 80% Coinsurance clause. If M insures a $2,200 claim for an eligible medical expense, how much will M receive in payment for this claim?

$1,600

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

Surgically removing a facial birthmark

A Health Reimbursement Arrangement MUST be established

by the employer

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

carryover provision

Which of the following medical expenses does Cancer insurance NOT cover?

Arthritis

An insured covered by a group Major Medical plan is hospitalized after sustaining injuries that resulted from an automobile accident. Assuming the plan has 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?

$3,000

An individual has a Major Medical policy with a $5,000 deductible and an 90/20 Coinsurance clause. How much will the INSURED have to pay if a total of $15,000 in covered medial expenses are incurred?

$7,000

Which of the following BEST describes a Hospital Indemnity policy?

Coverage that pays a stated amount per day of a covered hospitalization

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 the policy

For which of the following expenses does a Basic Hospital policy pay?

Hospital room and board

T was treated for an ailment 2 months prior to applying for a health insurance policy. This condition was noted on the application and the policy was issued shortly afterwards. How will the insurer likely consider this condition?

Insurer will likely treat as a pre-exhisting condition which may not be covered for one year

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

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

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

Major Medical policies typically

contain a deductible and coinsurance

A prospective insured completes and signs an application for health insurance but intentionally conceals information about a pre-exhisting 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

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