Other Health Insurance Concepts Q&A

Which of the following premium modes would result in the highest annual cost for an insurance policy?

Monthly

The legal process that gives the insurer, after payment of a loss, the right to seek recovery from a third party that was responsible for the loss is known as

Subrogation

When may an insured deduct unreimbursed medical expenses paid under a long-term care policy?

When the expenses exceed a certain percentage of the insured's adjusted gross income

A noncontributory group disability income plan has a 30-day waiting period and offers benefits of $2,000 a month. If an employee is unable to work for 7 months due to a covered disability, the employee will receive

$12,000, all of which is taxable.

An insured is covered by a partially contributory group disability income plan that pays benefits of $4,000 a month. If the insured pays 25% of the monthly premium, how much of the monthly benefit would be taxable?

$3,000

For group medical and dental expense insurance, what percentage of premium paid by the employer is deductible as a business expense?

100%

What is the maximum age for qualifying for a catastrophic plan?

30

If an insured changes his payment plan from monthly to annually, what happens to the total premium?

Decreases

Which of the following statements regarding the Change of Beneficiaries Provision is false?

The policyowner has the right to change beneficiaries in any case.

Premiums paid by self-employed sole proprietors or partners for medical expense insurance are

Totally tax deductible

The Patient Protection and Affordable Care Act mandates that insurers provide coverage for adult children of the insured up to the age of

26

According to the PPACA rules, what percentage of health care costs will be covered under a bronze plan?

60%

Under which condition would an employee's group medical benefits be exempt from income taxes?

An employee's group medical benefits are generally exempt from taxation as income

Which of the following is not true of Disability Buy-Sell coverage?

Benefits are considered taxable income to the business.

An individual is insured under his employer's group Disability Income policy. The insured suffered an accident while on vacation that left him unable to work for 4 months. If the disability income policy pays the benefit, which of the following would be true?

Benefits that are attributable to employer contributions are fully taxable to the employee as income.

Which of the following statements about occupational vs. nonoccupational coverage is TRUE?

Disability insurance can be written as occupational or nonoccupational

Concerning group Medical and Dental insurance, which of the following statements is INCORRECT?

Employee benefits are tax deductible the year in which they were received.

In an individual long-term care insurance plan, the insured is able to deduct the premiums from taxes. What income taxation will be imposed on the benefits received?

No tax

The coverage provided by a disability income policy that does not pay benefits for losses occurring as the result of the insured's employment is called

Nonoccupational coverage

Premium payments for personally-owned disability income policies are

Not tax deductible.

Which of the following applies to partial disability benefits?

Payment is limited to a certain period of time

Which of the following describes taxation of individual disability income insurance premiums and benefits?

Premiums are not tax deductible, and benefits are not taxable

Which of the following describes taxation of individual disability income insurance premiums and benefits?

Premiums are not tax deductible, and benefits are not taxable.

Which of the following is correct regarding the taxation of group medical expense premiums and benefits?

Premiums are tax deductible and benefits are not taxed

Disability income policies can provide coverage for a loss of income when returning to work only part-time after recovering from total disability. What is the benefit that is based on the insured's loss of earnings after recovery from a disability?

Residual disability

Workers Compensation benefits are regulated by which entity?

State Government

A husband and wife are insured under group health insurance plans at their own places of employment, and as dependents under their spouse's coverage. If one of them incurs hospital expenses, how will those expenses likely be paid?

The benefits will be coordinated

The purpose of managed care health insurance plans is

To control health insurance claims expenses

S is a sole business proprietor who owns a medical expense plan. What percentage of the cost of the plan may he deduct?

100%

Disability income coverage specifies that the policy covers the insured if he is unable to perform any job for which he is qualified. In this case, total disability is defined as

Any occupation - more restrictive than other definitions.

Which statement accurately describes the Change of Beneficiary provision?

Any policy that has a death benefit must also have a Change of Beneficiary provision.

Under a Key Person disability income policy, premium payments

Are made by the business and are not tax-deductible.

Which of the following is NOT true regarding Workers Compensation?

Benefits are offered by the insurer.

All of the following are true regarding Key Employee Disability Income insurance EXCEPT

Benefits are taxable to the employer

Which of the following statements is correct concerning taxation of long-term care insurance?

Excessive benefits may be taxable.

The transfer of an insured's right to seek damages from a negligent party to the insurer is found in which of the following clauses?

Subrogation

Which characteristic does NOT describe managed care?

Unlimited access to providers

The sole proprietor of a business makes a total salary of $50,000 a year. This year, his medical expenses have reached a total of $75,000. What amount may the sole proprietor deduct in regards to his medical expenses?

$50,000

Which of the following individuals will be eligible for coverage on the Health Insurance Marketplace?

A permanent resident lawfully present in the U.S.

Which of the following would best describe total disability?

A person's ability to work is significantly reduced or eliminated for the rest of his/her life.