Medicare/LTC Quizzes

Which product supplements Medicare by offering benefits delivered through a network of health care providers?

*Medicare SELECT plan* long-term care insurance Medicaid tax-qualified long-term care Medicare supplement coverage offered in this way is called a Medicare SELECT plan. Like other managed care plans, a Medicare SELECT plan requires the insured to use health care providers within its network to be eligible for full benefits.

Which entity oversees the administration and processing of Medicare Part B policies and claims?

*carrier* intermediary utilization review committee quality improvement organization A Medicare carrier enters into contracts with the government to oversee the administration and processing of Part B policies. Whenever a Medicare provider has questions regarding coverage, billing, or enrollment, it will typically contact a carrier for information.

Which entity handles claims for Part A from hospitals, skilled nursing facilities, home health agencies, and hospices?

*intermediary* utilization review committee quality improvement organization carrier An intermediary is a private company that has a contract with Medicare to handle Part A claims from hospitals, skilled nursing facilities, home health agencies, renal dialysis facilities, and hospices.

If a policyholder becomes eligible for Medicaid, a Medicare supplement policy must suspend benefits and premiums at the policyholder's request for up to how many months?

36 *24* 12 6 When a policyholder is covered by Medicaid, a Medicare supplement policy must suspend benefits and premium at the policyholder's request for up to 24 months, but only if the insurer is notified within 90 days of the date on which the policyholder becomes eligible for Medicaid.

Which of the following benefits is not covered by Medicare supplement insurance policies?

coinsurance for days 61 through 90 in the hospital the first three pints of blood *prescription drugs* hospice care All Medicare supplement policies must cover certain basic benefits, including the first three pints of blood, coinsurance amounts for days 61 through 90 in the hospital, and hospice care. They do not include benefits for prescription drug coverage.

Which of the following benefits is not provided under Medicare Part A?

first three pints of blood each year hospice care Part B coinsurance amount *prescription drug coverage* Medicare Part A provides coverage for the first three pints of blood each year, hospice care, and the 20% Part B coinsurance amount. It does not provide prescription drug coverage.

Medicare Part B will not cover which of the following services?

heart transplants *dental care* preventive services outpatient physical therapy Part B covers many preventive services along with outpatient physical therapy and heart transplants. It does not cover dental care.

Which type of Medicare supplement marketing method fails to disclose that the purpose of the contact is the solicitation of insurance?

high pressure sales tactics illegal inducement *cold lead advertising* twisting Producers and insurers are prohibited from engaging in cold lead advertising, or failing to disclose that the intent of the advertising is to sell insurance and that a producer or insurance company will contact the prospect.

Which entity reviews the medical necessity of admissions, duration of hospital stays, and the types of care provided to Medicare and Medicaid beneficiaries?

intermediary carrier quality improvement organization *utilization review committee* Each Medicare participating hospital must have a utilization and review committee that reviews the services provided by the institution and its medical staff to Medicare and Medicaid patients. The utilization review committee evaluates the medical necessity of admissions, durations of stays, and professional services provided.

Which is a common benefit period in a long-term care insurance policy?

one to three years two to six months *two to five years* six to ten years Common benefit periods are two to five years, though some policies may offer lifetime benefits.

Which of the following will be covered by a Medicare supplement policy?

vision care hearing aids *hospice care* long-term care Medicare supplement policies exclude coverage for long-term care, vision or dental care, hearing aids, private duty nursing, and prescription drugs. Hospice care is a core benefit in all Medicare supplement policies.

Which provision in a long-term care policy guarantees that if the insured stops paying premiums after a specified period, he or she will at least receive some of the benefits from the policy?

waiver of premium guaranteed issue *nonforfeiture* premium refund A nonforfeiture benefit ensures that if the insured stops paying premiums after a specified period, he or she will at least receive some of the benefits from the policy. Generally, the longer the insured pays premiums for a policy, the larger the nonforfeiture benefit will be.

Geraldine is applying for Medicare supplement Plan C. At what point must the insurer give her an outline of coverage?

when the premium is paid *at the time of application* when a policy summary is presented at policy delivery Insurers are required to provide an outline of coverage about their Medicare supplement policies at the time a person applies for coverage.

Ed is 67 years old and incurred the following medical expenses for the year: $100 for an eye exam, $300 for a dental exam, and $3,000 for hearing aids. What amount of Ed's expenses is covered by Medicare Part A?

*$0* $400 $3,000 $3,400 Medicare Part A does not cover the cost of eye exams, dental exams, or hearing aids.

A long-term care insurance policy is designed to provide coverage for at least how many months?

*12* 18 24 36 Long-term care insurance is designed to provide coverage for at least 12 months for necessary diagnostic, preventive, therapeutic, rehabilitative, or personal care services provided in a setting other than the acute care unit of a hospital.

How many days of care in a specialty psychiatric hospital will Medicare Part A cover during a person's lifetime?

*190* 120 100 210 If a person is in a specialty psychiatric hospital, Medicare helps pay for a total of 190 days of inpatient care during the individual's lifetime.

An agent's commission for the sale of a Medicare supplement policy in the first year following its effective date cannot exceed what percentage of the commission paid for servicing the policy in the second year?

*200* 100 25 150 An agent's commission for the sale of a Medicare supplement policy in the first year following its effective date cannot exceed 200 percent of the commission paid for servicing the policy in the second year.

After the deductible is paid, the insured can expect Medicare Part A to cover all eligible hospital expenses without a copayment for up to:

*60 days* 45 days 10 days 30 days After the insured pays the deductible, Part A pays all eligible hospital costs without a copayment from the insured for up to 60 days.

Which statement does NOT describe the standard Medicare supplement plans?

*A plan may be cancelled if the insured's health significantly deteriorates.* Plans B through N include Plan A's core benefits. Plan A provides the basic core benefits. Insurers selling Medicare supplement policies must offer Plan A. A policy cannot be canceled because of the insured's health.

Adam is a Medicare beneficiary who is also eligible for his state's Medicaid program. For Adam, what does Medicaid serve as?

*Adam's secondary insurer, with Medicare as his primary insurer* Adam's primary insurer, with Medicare as his secondary insurer Adam's co-insurer along with Medicare Adam's only insurer because it supersedes Medicare Medicaid serves as Adam's secondary insurer. Medicare is his primary insurer.

Sid is applying for Medicaid. What must he do in order to apply?

*Disclose all assets and sources of income and meet his state's requirement for maximum allowable assets and income.* Sell his home. Exceed his state's maximum allowable assets and income by no more than 20 percent. Exclude his home and other real estate assets from his application.

Which of the following statements about Medicare Part D prescription drug coverage is CORRECT?

Medicare Advantage plans never provide prescription drug coverage. *Individuals who join a Medicare Part D prescription drug plan must pay a separate monthly premium for the coverage.* Individuals may obtain prescription drug coverage only through stand-alone plans issued by Medicare. Medicare recipients are automatically enrolled in Part D when they enroll in Medicare. Enrolling in a Part D plan is optional. Individuals must pay an additional premium to obtain prescription drug coverage through Part D.

Which document do Medicare beneficiaries receive every quarter that contains information about the health-care services they received under Medicare?

Medicare Explanation of Benefits Medicare Patients' Bill of Rights Medicare Disclosure Notice *Medicare Summary Notice* A Medicare Summary Notice (MSN) is a summary of claims for health-care services that Medicare processed for a person during the previous three months. The MSN contains information about the amount that Medicare paid as well as the amount the person must pay.

Which of the following statements about an individual long-term care insurance policy is TRUE?

They must be noncancelable. They do not need the insured's acceptance to increase benefits at a higher premium. *They must be guaranteed renewable.* They can exclude benefits by type of illness. Individual LTC insurance policies issued in North Carolina must be guaranteed renewable. The insured can continue the insurance by paying the premiums on time.

Marilyn, 72, thinks she may be spending a significant amount of money on medical expenses. She considers transferring her assets to her son so that she will be poor enough to qualify for Medicaid. Her son cautions her about Medicaid's look-back rules. How will these rules pertain to her?

They will reflect the amount of Medicaid benefits paid on Marilyn's behalf during the first six months of Medicaid eligibility. They will reflect the amount of benefits Medicare pays for care that Marilyn receives if she is in a skilled nursing home facility. Look-back rules look at the income, if any, that Marilyn earned during the 36 months before she applied for Medicaid. *These rules allow Medicaid to look back on transfers of assets Marilyn made during the 60 months before applying for Medicaid.* If an asset is improperly transferred, a state can consider the asset countable toward eligibility determination. States can look back for 60 months to find improper transfers of assets. If a transfer of assets for less than fair market value is found, the state must withhold payment for nursing facility care and certain other long-term care services.

Medicare's system for paying physicians is based on which of the following?

a reasonable fee per geographic area approach an indemnity approach *a fee schedule* a percent-of-charges schedule Medicare's system for paying physicians is based on a fee schedule, which assigns a dollar value to each service provided.

Eligibility for Medicaid is determined by state requirements. Which of the following is NOT one of those requirements? Which of the following is NOT a factor states would use to determine eligibility for Medicaid?

disability or age *citizenship limitations* income limitations asset limitations Eligibility for Medicaid is determined by state requirements in three areas: disability or age, income limitations, and asset limitations.

When determining eligibility for Medicaid, states do NOT consider:

disability or age *household size* income limitations asset limitations States determine eligibility for Medicaid on the basis of disability or age, income limitations, and asset limitations.

The general types of coverage that Medicaid may provide, depending on the state, include all of the following, EXCEPT

doctor and surgeon fees; dentist, podiatrist, psychologist, and optometrist fees; prescription drug costs; and rural health clinic services. *health care received outside the United States, skilled nursing facility care, cosmetic surgery, and personal comfort items.* inpatient and outpatient hospital care, mental health services, medical supplies and equipment, prostheses, hearing aids, eyeglasses, and braces. X-ray and lab services, hospice care, transportation to services, personal care assistance, and long-term care. Health care received outside the United States, skilled nursing facility care, cosmetic surgery, and personal comfort items are covered under Medicare Part B, not under Medicaid.

Which is NOT an optional benefit commonly available with long-term care insurance policies?

nonforfeiture benefit return of premium *substance abuse coverage* inflation protection TC policies exclude long-term care associated with alcohol and drug dependency.

Abby purchased a long-term care policy on June 15. Two weeks later, she lost her job and decided that she could no longer afford the policy. What are her options?

She can return the policy for a partial refund of premium. She can return the policy but will not receive a refund of premium. *She can return the policy for a full refund of premium.* She cannot return the policy because the free-look period has ended. Individual long-term care insurance policyholders have the right to return the policy within 30 days of delivery and receive a full refund of premium if, after examining the policy, they are not satisfied for any reason.

Mrs. Smythe receives home health care under Medicare Part A. Which of the following services would not be covered?

intermittent skilled care *full-time skilled care* home health aide services durable medical equipment and supplies Medicare Part A covers part-time or intermittent skilled care but not full-time care.

Marty and Juanita are married and own a total of $250,000 in countable resources on the day Marty is admitted to a nursing home. What amount can Juanita retain if Marty applies for Medicaid long-term care benefits in North Carolina?

$150,000 *$109,560* $125,000 $100,000 If a person is married and only one spouse needs LTC, North Carolina's Medicare-Aid rules allow the at-home spouse to keep a certain amount of the couple's combined community and separate property known as the community spouse resource allowance. In 2011, this amount is $109,560.

Which of the following statements best characterizes the role of Medicaid for its recipients?

*For many elderly Medicare recipients, Medicaid assistance is essential. The costs associated with an extended nursing home stay or with catastrophic illnesses can quickly overwhelm personal savings.* Medicare covers custodial care because most nursing home stays do not exceed 30 months. Because the costs associated with a nursing home stay seldom overwhelm personal savings, Medicaid recipients use little of their benefits. IncorrectAssistance for medical care under the Medicaid program can be provided for people who are unable to receive Supplementary Security Income benefits from Social Security. Assistance for medical care under the Medicaid program can be provided for people who receive Supplementary Security Income benefits from Social Security.

Edward, age 65, is thinking about purchasing a Medicare Advantage plan. If he purchases a plan, his benefits can be administered through all of the following EXCEPT:

*Medicaid* Medicare health maintenance organizations (HMOs) Preferred provider organizations (PPOs) Medicare Special Needs plans Under Medicare Advantage plans, Medicare beneficiaries can choose to have Medicare benefits administered by traditional Medicare or by Medicare health maintenance organizations (HMOs), preferred provider organizations (PPOs), private fee-for-service plans, and Medicare Special Needs plans.

Medicare made a conditional payment to cover Jim's medical expenses after he was injured by a third party in a car accident. What happens if the third party's insurance company reimburses Jim for his care?

*Medicare can recover the conditional payment.* Medicare cannot recover from Jim. Medicare can recover the conditional payment only if it files a lien against Jim's Medicare benefits. Medicare can recover the conditional payment only from the insurance company. Medicare can make a conditional payment when health-care services are provided, and another party is potentially responsible. In this case, any payment must be repaid to Medicare when a settlement, judgment, or award is reached. This right—known as subrogation—allows Medicare to recover the conditional payment.

Ned is enrolled in a Medicare MSA plan and has spent all of the funds in his savings account. What happens if Ned has not yet reached the deductible?

*Ned must pay for all of his health-care expenses out of pocket until he reaches the deductible.* Part of Ned's health-care expenses will be covered by the plan. Ned may re-apply for more funds so that his health-care expenses will be covered by the plan. All of Ned's health-care expenses will be covered by the plan. If a person uses all of the money in his or her MSA and has not yet met the deductible, the person must pay for all of his or her medical expenses out of pocket until reaching the deductible. At that point, the plan will pay for Medicare-covered expenses.

Alicia purchased the standardized Medigap Plan A. Which of the following is covered in her plan?

*Part B coinsurance* Part A deductible Part B deductible Part A coinsurance for days 21 through 100 of skilled nursing facility care. Part B coinsurance is covered. Plan A covers only the core benefits, and Part B coinsurance is the only one of the core benefits among the choices given.

Insurers that offer Medicare supplement insurance must, in addition to Plan A, offer at least:

*Plan C or Plan F* Plan C and Plan F Plan C Plan D All insurers that offer Medicare supplement insurance must offer Plan A. They must also offer Plan C or Plan F.

Which Medicare supplement plan covers the copayment for the 61st through 90th day of hospitalization?

*Plans A through N* Plans A, B, and C only Plans A and B only Plan C only All plans pay the 61st through 90th days' copayment for hospitalization, as well as the 91st through 150th days' copayment for each lifetime reserve day, and hospital costs up to 365 days.

Which program is not offered through a state's Medicare Savings Program?

*Special Needs Awareness Program* Qualified Disabled Working Individual Program Qualified Medicare Beneficiary Program (QMB) Qualified Individual Program All states have Medicare Savings Programs to help individuals with limited income and asset levels pay for health-care coverage. The four programs offered include a Qualified Medicare Beneficiary (QMB) program, Specified Low-Income Medicare Beneficiary (SLMB) program, the Qualified Individual (QI) program, and the Qualified Disabled Working Individual (QDWI) program.

Which of the following states was NOT required to adopt the NAIC model act standardizing Medigap insurance?

*Wisconsin* Washington Michigan Montana Wisconsin. The other two states who received a waiver from adopting the NAIC's Medigap standardization scheme were Massachusetts and Minnesota.

Which of the following statements best describes Medicaid?

*a medical assistance program funded by federal and state taxes to assist low-income people* a welfare program of medical expense insurance funded by state governments only supplemental medical care insurance attached to accident and health insurance policies Medicaid insurance is identical to Medicare insurance. Medicaid provides health care and health-related services to people with low incomes and other needy individuals. It is jointly funded by the federal and state governments, but it is administered by the states.

Dr. Smith signed a Medicare participation agreement stating that he will accept the Medicare-approved amount as payment in full for his services. This means that Dr. Smith will submit claims to Medicare on what type of basis?

*an assigned basis* an indemnity basis a reimbursement basis an unassigned basis When a person receives health-care services, the physician submits a Medicare claim to the carrier either on an assigned or an unassigned basis. When a claim is assigned, the physician has agreed to accept the Medicare-approved amount as payment in full for his or her services.

All of the following services are generally covered under Medicaid EXCEPT:

*cosmetic surgery* mental health services rural health clinic services prescription drug services Medicaid covers necessary medical services, including transportation, as well as necessary prescription drugs. Cosmetic surgery is not covered.

Perry just turned 85 years old. He lives alone. However, he needs help with everyday tasks such as bathing, eating, and dressing. Which type of long-term care does Perry need?

*custodial care* respite care Incorrectskilled nursing care intermediate care Custodial care is provided to help a person meet daily living requirements, like bathing, dressing, or eating. Custodial care can be provided in nursing homes, adult day-care centers, respite centers, or a person's home.

Sean, age 67, is covered by a group health plan that is scheduled to terminate on March 1. Sean can enroll in Medicare Part B without having to pay the 10 percent premium surcharge if he enrolls when?

*during the eight-month period following the month his group coverage ends* during the six-month period following the month his group coverage ends during the first general enrollment period after his group coverage ends during a special enrollment period beginning six months after his group coverage ends A person who is age 65 or older and covered under a group health plan can enroll in Medicare Part B without having to pay the 10 percent premium surcharge for late enrollment during the eight-month period following the month the group health coverage ends or following the last month employment ends—whichever comes first.

All of the following may deduct the full cost of their qualified LTCI premiums, subject to the age-based limits, EXCEPT:

*employees whose premiums are paid by their employers* LLC owners members of a partnership sole proprietors Sole proprietors, partners, and LLC owners can deduct all of the premiums for their qualified LTCI policies, subject to the age-based limits. Employees who are insured under a group plan and whose premiums are paid by the employer cannot deduct the premiums; however, the premiums paid on their behalf are not included in their incomes.

Long-term care insurance policies exclude certain conditions from coverage. Common LTC policy exclusions include all of the following EXCEPT

*impairment not requiring substantial assistance from another person* alcohol and drug dependency self-inflicted injuries conditions resulting from war and conditions arising from criminal activity Impairment not requiring substantial assistance from another person is a cognitive impairment, and cognitive impairments are not an exclusion.

Which level of long-term care provides ongoing but not continuous care to address a person's condition and is delivered by registered nurses, licensed practical nurses, and nurses' aides under a doctor's supervision?

*intermediate care* custodial care remedial care skilled nursing care Intermediate care provides ongoing care necessary to address a person's condition but is not needed 24 hours a day.

Amanda applied for a long-term care policy on August 1, at which time she received a document disclosing the policy's benefits, exclusions, renewal provisions, and continuation provisions. Which document did Amanda receive?

*outline of coverage* Notice Regarding Replacement Shopper's Guide Buyer's Guide An outline of coverage must describe a long-term care policy's benefits, exclusions, renewal provisions, and continuation provisions.

Which of the following benefits is typically not covered by Medicare Part B?

*prescription drugs* rural health clinics kidney dialysis radiation therapy Part B covers radiation therapy, kidney dialysis, and care provided by rural health clinics. It does not provide prescription drug coverage.

Which of the following Medicare Advantage plans always includes prescription drug coverage?

*special needs plan (SNP)* preferred provider organization (PPO) plan private fee-for-service (PFFS) plan medical savings account (MSA) plan The special needs plan (SNP) must include prescription drug coverage. PPOs, HMOs, and PFFS plans may or may not include it, but MSA plans never include it.

Agent Jones and Trudy are meeting to discuss Medicare supplement policies. At what point must Agent Jones give Trudy an outline of coverage?

*when Trudy applies for a policy* no later than at policy delivery when Trudy pays the first premium only upon Trudy's request Insurers are required to provide an outline of coverage about their Medicare supplement policies at the time a person applies for coverage.

What is the maximum length of time that a Medicare supplement policy can exclude individuals from coverage based on pre-existing medical conditions?

12 months *6 months* 3 months 24 months A Medicare supplement policy can exclude benefits during the first six months of coverage on the basis of a pre-existing condition for which the insured received treatment or was diagnosed during the six months before the effective date of coverage.

Horace buys a Medicare supplement insurance policy but decides not to keep it. How many days does he have to return it for a full refund of the premium?

10 days 14 days 21 days *30 days* Medicare supplement policies issued in North Carolina must provide a free-look period of at least 30 days, during which time the insured can return the policy for any reason and receive a full refund of the premium.

Phil, age 80, just learned that he is eligible for Medicare's home health care benefits, which means that he can receive

24-hour full-time home health care custodial care full-time housekeeping services *occupational therapy services in his house* Individuals who are eligible for Medicare's home health care benefits can receive intermittent skilled nursing care, physical therapy, speech therapy, and occupational therapy. Part A does not cover custodial care or full-time home health care or housekeeping services.

After being hospitalized, Martha was transferred to a nursing home for additional care. If she meets Medicare's requirements for skilled nursing facility coverage, Medicare will pay all of her covered expenses for how many days?

30 *20* 80 0 Medicare pays for 100% of all covered expenses for skilled nursing facility care for the first 20 days. For the next 80 days, the patient is required to pay a daily co-amount. After 100 days, Medicare pays nothing, and the patient is responsible for all charges.

What is the usual coinsurance percentage that Medicare beneficiaries must pay for services covered under Part B of Medicare?

50 percent 80 percent *20 percent* 0 percent There are exceptions, but in general, Medicare beneficiaries are required to pay 20 percent of the cost of covered services received from health-care providers under Medicare Part B.

Which of the following is not a requirement for a long-term care policy to be considered tax-qualified?

A policy must be guaranteed renewable. Medical necessity cannot be used as a benefit trigger. Benefits cannot duplicate Medicare's benefits. *A policyowner must be unable to perform at least four out of six activities of daily living.* HIPAA sets forth a number of criteria that policies must comply with to be considered qualified. For example, a policy will pay benefits if an insured is unable to perform two out of six activities of daily living, which include eating, toileting, transferring, bathing, dressing, and continence.

Which individual can take an income tax deduction for the amount of long-term care premiums paid?

Anna, who owns a nonqualified long-term care policy and takes the standard deduction each year Jose, who owns a qualified long-term care policy but whose premiums are less than 10 percent of his adjusted gross income *Tina, who owns a qualified long-term care policy and itemizes her deductions* Jerry, who owns a nonqualified long-term care policy and itemizes his deductions Individuals can deduct part of the premiums paid as a medical expense on their federal tax return, but only if they itemize deductions on Form 1040 Schedule A. To be eligible for an income tax deduction, total medical expenses must exceed 10 percent of an insured's adjusted gross income, or AGI.

Your client asks you to describe the benefit triggers of tax-qualified long-term care insurance policies. Which of the following statements is correct?

Benefits are triggered only when an insured enters a nursing home or other long-term care facility. Benefits are triggered by a person's inability to perform the instrumental activities of daily living. Benefits are triggered when an insured needs both informal and formal care at home. *Benefits are triggered by a physical impairment or a severe cognitive impairment.* A long-term care policy may condition the payment of benefits on cognitive impairment or the inability to perform activities of daily living. A licensed health-care professional must assess whether an insured suffers from cognitive impairment or is unable to perform the activities of daily living.

Which of the following conditions must be met before Medicare Part B will provide coverage for home health care?

Care must be provided for at least 60 days. *A doctor or health-care provider must order the care.* The person must require custodial care. The person must be able to leave the house on a regular basis. Part B will provide coverage for medically necessary part-time or intermittent home health care. A doctor or other health-care provider enrolled in Medicare must order the care, and a Medicare-certified home health agency must provide it.

In 2003 the federal government replaced private insurers with which of the following entities to process Medicare claims and payments?

Diagnostic Related Groups (DRGs) Prospective Payment System (PPS) *Medicare Administrative Contractor (MAC)* Quality Improvement Organization (QIO) The federal government substituted Medicare administrative contractors (MACs) for private insurers to process Medicare claims and payments. In addition to processing claims and payments, MACs enroll health care providers in the Medicare program and train them in Medicare billing requirements.

For which of the following North Carolina residents will Medicare-Aid pay for their Medicare Part B premiums only?

Derrick, who is a Special Needs Beneficiary Kate, who is a Qualified Beneficiary (QMB) Martina, who is a community spouse *Victor, who qualifies as a Specified Low-Income Beneficiary (SLMB)* For those individuals who qualify as Specified Low-Income Beneficiaries (SLMBs), Medicare-Aid will pay for their monthly Medicare Part B premiums.

Which of the following is an example of formal care in the context of long-term care?

Don helps his cousin Dora with her basic ADLs five days a week. Sasha drives her elderly neighbor to and from the local senior center every day. Ben visits his housebound aunt and uncle daily. *Dennis performs homemaker chores through an agency.* Formal caregivers are those associated with a service system, as opposed to family members or friends.

Which statement is correct about state administration of Medicaid?

Every state provides the same Medicaid benefits. Every state must have the same requirements for Medicaid eligibility. *All states base Medicaid eligibility on financial need.* States cannot provide Medicaid assistance to anyone under age 65. Eligibility for Medicaid assistance is based on financial need.

The states are allowed, within limits, to make their own rules about what is and is not covered by Medicaid. As a result, which of the following statements is true?

Every state provides the same benefits and has the same requirements for eligibility. States always offer Medicaid and Medicare services and medical care together. *Eligibility for Medicaid assistance is based only on financial need.* In no state are Medicaid services provided with Medicare. States individually determine the benefits provided and requirements for eligibility.

Which of the following individuals would be the most likely candidate for hospice coverage under Medicare Part A?

Gladys, who is chronically ill *Peter, who is terminally ill and has a three-month life expectancy* Adam, who suffers from diabetes Suri, who has cancer and whose prognosis is uncertain Medicare Part A will cover hospice care for Medicare-eligible people who are terminally ill and have life expectancies of six months or less.

Angelo is about to turn 65 and has come to you for advice regarding Medicare coverage. What correct information do you give him?

He must enroll in both Medicare Part A and Part B and pay a premium for each program. He must enroll in Medicare Part A and pay an annual premium for its coverage before he will be eligible for Part B. *He must pay a monthly premium to be covered by Medicare Part B.* He will automatically be enrolled in Medicare Part B and Part C once he turns 65. Coverage under Medicare Part B is elective and requires the payment of a monthly premium, which is deducted from a person's Social Security retirement benefit.

Mason wants to purchase a Medicare supplement policy that includes prescription drug coverage. As his advisor, you inform him that:

If he chooses a policy with prescription drug coverage, the policy will be significantly more expensive. *Medicare supplement plans can no longer contain prescription drug coverage.* Medicare supplement plans can only offer a limited prescription drug benefit. He should purchase a high deductible plan to offset the increased cost of prescription drug coverage. Before Medicare Part D was introduced, some Medicare supplement plans included coverage for prescription drugs. Though policies that have these benefits can continue in force, no Medicare supplement plan can now include coverage for prescription drugs.

Which statement does NOT describe Medicare supplement policies?

Insurers selling Medicare supplement policies must sell Plan A. *Medicare adjusts its deductibles and copayments to match insurers' benefits.* Plan A provides the core benefits of Medicare supplement insurance. Medicare supplement policies are guaranteed renewable. When Medicare adjusts its deductibles and copayments, Medicare supplement policies must align benefits with the adjustments.

How does Part C change the delivery of health care services under Medicare?

It increases accessibility to services for eligible individuals. It limits the coverage of Parts A and B. It reduces the coverage of Parts and B. *It uses managed care providers.* Part C offers Parts A and B services through managed care plans and private fee-for-service plans.

How would you explain "spending down" to a client who asks about Medicaid eligibility?

It is a state and federal requirement for Medicaid eligibility. Other insurance policy limits must be exhausted first. *An applicant must nearly exhaust his or her savings to become eligible.* Social Security assets must be exhausted. If personal assets are above the allowable limit, the applicant must nearly exhaust them before becoming eligible for Medicaid. This is referred to as spending down.

Abby, age 66, is applying for an individual health insurance policy with ABC Insurers. What must ABC Insurers do since Abby is eligible for Medicare?

It may not issue a policy. *It must notify her that the policy is not a Medicare supplement policy.* It must notify her that she may not be eligible for Medicare if she purchases an individual policy. It must obtain her written consent agreeing to the overlap in benefits. An insurer that issues an accident and health or disability income insurance policy (other than a Medicare supplement policy) to a person who is eligible for Medicare must notify the insured that the policy is not a Medicare supplement policy.

All of the following are true concerning Medicaid EXCEPT:

It was signed into law as Title XIX of the Social Security Act. It is both federally and state funded. It is administered by the states. *It is not means tested.* Eligibility for Medicaid assistance is based only on financial need, which makes it a means-tested program.

Jason is applying for Medicaid assistance and is listing all of his assets and income. He owns a ten-year-old car, $200 in cash, some personal items, and an industrial life insurance policy with a $1,000 face amount. Which statement is correct?

Jason can only have $5,000 total in assets and still qualify for Medicaid. Jason can only keep his personal items and $500 in cash to qualify for Medicaid. Jason must spend down all of his assets in order to qualify for Medicaid. *The amount of assets Jason can keep and still qualify for Medicaid will depend on his state's formula for calculating the maximum allowable income and assets.* A person's need for assistance is based on his or her state's formula for calculating the maximum allowable income and assets. The calculation excludes certain assets and does not allow an applicant to have many "excess" funds. The specific limits also change annually.

Ted turns age 65 in June. When does his initial enrollment period for Medicare begin?

July 1 February 1 June 1 *March 1* An individual's initial enrollment period for Medicare is the seven-month period that begins on the first day of the third month prior to the month in which the individual turns age 65. March is the third month prior to June, when Ted turns age 65.

Which statement describes the importance of Medicaid?

Medicaid assistance is principally spent on long-term care for the elderly. Medicaid assistance is limited to those who cannot get Medicare coverage. *For many elderly Medicare recipients, Medicaid reduces the financial burden of long-term nursing home care and catastrophic illness.* Medicaid's sole purpose is to provide health care coverage for senior citizens. For many elderly Medicare recipients, Medicaid assistance reduces the financial burden of long-term nursing home care and catastrophic illness, which can force them to exhaust their Medicare benefits and personal savings.

Nick is enrolled in Medicare Parts A and B and is now eligible for his state's Medicaid program. He incurred $500 in doctors' fees this month. How will this expense be paid?

Medicaid must pay benefits first. *Medicare must pay benefits first.* Medicaid and Medicare must share the cost of the doctors' fees. Neither Medicaid nor Medicare must pay for the doctors' fees. For Medicare beneficiaries who are eligible for their state's Medicaid program, Medicaid serves as the secondary insurer. Medicare is the primary insurer.

Which of the following statements best describes the Medicaid benefit program?

Medicaid provides a range of health services for beneficiaries, but services vary from city to city. Medicaid provides the same range of health services for beneficiaries in all states. Medicaid provides a range of health services for beneficiaries in all states, but services vary from county to county. *Medicaid provides a range of health services for beneficiaries, but services vary from state to state.* Medicaid provides a range of health services for beneficiaries, but services vary from state to state.

When and why was Medicaid created?

Medicaid was established in 1965 by Title XIX of the Social Security Act to provide health care and health-related services to people with low incomes. It is jointly funded by the federal and state governments and administered by the states.

Which of the following is specifically designed to cover Medicare's co-payments and deductibles?

Medicare Part D medical expense insurance *Medicare supplement insurance* long-term care insurance Medicare Parts A and B include many gaps in their coverage, notably the deductible and co-payments required of the recipient for covered services. Medicare supplement policies—also known as Medigap plans—are specifically designed to cover these gaps and to augment certain Medicare coverages.

Even though they offer the same benefits as Medicare supplement policies, why do Medicare SELECT plan's charge a lower premium?

Medicare supplement policies are guaranteed renewable. Medicare SELECT policies do not cover nursing home or custodial care. *Medicare SELECT plans deliver health care through a network of providers.* Medicare supplement policies must adjust to changes in Medicare. Medicare SELECT plans deliver health care through a network of providers, which reduces the cost of care.

Jenny owns an insurance policy that allows her to protect some of her assets from the spend-down requirement if she ever needs to apply for Medicaid. Based on this information, what kind of policy does Jenny own?

Medicare supplement policy traditional long-term care policy *North Carolina Long-Term Care Partnership policy* life insurance policy with a long-term care rider Individuals who purchase North Carolina long-term care partnership policies are allowed to keep assets equal to the amount of benefits the long-term care policy provided, if they eventually apply for Medicaid. In addition, these assets are exempt from Medicaid estate recovery upon the insured's death.

When selling a long-term care insurance policy, the insurer or agent must provide the applicant with all of the following EXCEPT:

Notice to Applicant Regarding Replacement of Accident and Health Insurance, if applicable option to buy inflation protection outline of coverage *Suitability Guide* Long-term care insurers must use suitability standards to determine whether the purchase or replacement of long-term care insurance is appropriate for the applicant's needs. However, they are not required to give applicants a Suitability Guide.

Your client asks you if his elderly relative might be eligible for Medicaid. What is your advice regarding income requirements?

Only one source needs to be reported at the federal level. Certain states require full income disclosure. Federal tax returns determine qualifying income. *Income limits are determined by the state.* In addition to being over age 65 without qualifying assets, if a Medicaid applicant has an income below the state limit, he or she qualifies for assistance.

Amanda suffers from congestive heart failure and is enrolled in a Medicare Special Needs plan. Which benefit will not be provided by her plan?

Part A coverages *Parts A and B deductibles and coinsurance amounts* Part B coverages prescription drug coverage under Part D Medicare SNPs provide their members with all Medicare Part A and Part B coverages along with Medicare prescription drug coverage (Part D). A person typically must pay a co-payment for prescriptions as well as any plan deductible, coinsurance, or co-payment amounts the Medicare SNP charges.

Jason is hospitalized and requires a blood transfusion. Which of the following statements is correct?

Part A will not cover any blood received in the hospital. *Jason must pay for the first three units of blood.* Part B will cover blood received in the hospital. Parts A and B will both cover the blood transfusion. Medicare Part A covers blood a person receives as an inpatient, while Medicare Part B covers blood received on an outpatient basis. However, a person must pay for the first three units of blood each year while in the hospital.

Max is considered a Qualified Medicare Beneficiary (QMB) in North Carolina, which means that Medicare-Aid will pay for all of the following EXCEPT:

Part B premium *100 percent of the Part D prescription drug costs* deductibles for Part A and B Part B co-payments The QMB program pays for the Part A deductible, Part B premium, deductibles for Parts A and B, and the annual co-payments for Parts A and B. It does not pay the entire cost of prescription drug expenses under Part D.

Which helped Medicare subscribers fill the gas in Medicare coverage?

The Centers for Medicare & Medicaid Services (CMS) created MSPs. *The insurance industry created MSPs.* The federal government created MSPs. The states developed MSPs.

Parts A and B have gaps in their coverage, where Medicare subscribers must pay the costs. Which of the following was done to fill these gaps in standard Medicare coverage?

To fill these gaps in standard Medicare coverage, the Centers for Medicare & Medicaid Services (CMS) created Medicare supplement policies. To fill the gaps in standard Medicare coverage, the federal government created Medicare supplement policies. To fill the gaps in standard Medicare coverage, the states developed Medicare supplement policies. *To fill the gaps in standard Medicare coverage, the insurance industry created Medicare supplement policies.*

In general, long-term care insurance policies issued can limit or exclude coverage with respect to which of the following?

Treatment for a specific type of illness Treatment for injuries resulting from a specific type of accident Treatment for a specific medical condition *Treatment for conditions covered by Medicaid* Treatment provided in a federal government facility and services for which benefits are available under Medicare or other governmental program may be excluded, with the exception of those covered by Medicaid.

Who would NOT be eligible for Medicare enrollment?

a person with end-stage renal disease a person who is 65 years old *a person under age 65 who has received Social Security disability benefits for six months* a person who has amyotrophic lateral sclerosis Medicare coverage is available to U.S. citizens and certain permanent residents who are at least 65 years old or have received Social Security disability benefits for at least two years, have end-stage renal disease, or have amyotrophic lateral sclerosis.

All of the following might receive Medicaid funds directly EXCEPT:

a physician a heart specialist *a patient in a skilled nursing facility* a laboratory performing diagnostic testing Medicaid payments for medical care are always made directly to service providers.

Whether a person is eligible for Medicaid depends largely on which of the following factors?

age of the person needing care *financial need* state of residence type of medical care needed Eligibility for Medicaid assistance is based only on financial need. Most Medicaid funds are spent on the elderly, but numerous others receive their share of Medicaid funding. For example, Medicaid covers children who are not eligible for Medicare.

If an applicant's assets are above the allowable limits for Medicaid, the applicant must nearly exhaust them to be eligible. What is this process of exhausting assets called?

asset depletion *spending down* diminution of assets paying out Exhausting assets to qualify for Medicaid is called "spending down."

Insurers can sell both qualified and non-qualified LTC policies. What can those who buy qualified policies do?

buy additional benefits unavailable to those who buy non-qualified policies exclude benefits from tax-qualified long-term care insurance policies from the recipient's income with no limits deduct their premiums from their state income taxes *deduct their premium payments from their federal income taxes within certain specified limits* Policyholders with tax-qualified long-term care insurance policies can deduct premium payments from their federal income taxes within certain specified limits.

During Medicare's open enrollment period, an insurance company selling Medigap policies

can refuse to sell Medigap policies to individuals who are eligible for Medicare. can charge those who are eligible for Medicare a higher premium because of health problems. can impose a probationary period for coverage to start under a Medigap policy. *must sell Medigap policies to individuals who are eligible to enroll in Medicare on a guaranteed issue basis.* Individuals who apply for a Medigap policy during the open enrollment period have a guaranteed issue right: they can buy any Medicare supplement policy the insurer sells, even if they have health problems, for the same price as others with good health.

Lacy, age 90, has been receiving 24-hour skilled nursing care at a long-term care facility, which is paid for by Medicaid. At Lacy's death, her estate consists of one car, $1,000 in a savings account, and a home valued at $150,000 that her husband lived in until his death two weeks earlier. If Medicaid has paid $160,000 for Lacy's long-term care, Medicaid

cannot recover any of Lacy's assets. can only seek recovery of Lacy's car and savings account. *can seek recovery from all of Lacy's assets.* can file a claim against Lacy's estate only if she died without a will. If any assets are left in a Medicaid recipient's estate, Medicaid can seek reimbursement for benefits it paid by filing a lien or claim against the estate. Assets that were previously exempt when applying for Medicaid (such as a person's home) will be considered part of the estate against which Medicaid may recover.

Henry's Medicare supplement policy states that the company can cancel or decline renewal only if he fails to pay premiums or made a material misrepresentation in the application. Which type of renewability provision does his policy have?

conditionally renewable noncancelable renewable at insurer's option *guaranteed renewable* With a guaranteed renewable Medicare supplement policy, an insurer may not cancel or nonrenew a policy because of the insured's health status or for any reason other than nonpayment of premium or material misrepresentation. However, the insurer may increase the premiums applicable to an entire class of policyowners.

Which level of care is NOT commonly covered under a long-term care insurance policy?

custodial care intermediate care skilled nursing care *medical care* Long-term care insurance does not cover medical care. Medicare, Medicaid, and individual medical expense insurance cover this expense.

Enrique is enrolled in a Medicare Part D plan but would like to change plans and obtain better coverage. At what point during the year can he switch to a different Part D plan?

each year from January 1 until March 1 between June 1 and September 1, Medicare's special election period *between November 15 and December 31, Medicare's annual election period* at any time During Medicare's annual election period, which occurs between November 15 and December 31 each year, individuals can change to a different Medicare drug plan if their plan coverage changes or their needs change.

How often must insurers in North Carolina file their Medicare supplement policy rates and rating schedules with the Commissioner?

every five years only when requested by the Commissioner every two years *annually* Insurers must annually file their rates, rating schedules, and supporting documentation to demonstrate that they are complying with the loss ratio standards established by the Commissioner.

Which of the following benefits is not provided under Medicare Part A?

first three pints of blood each year hospice care skilled nursing facility care *prescription drug coverage* Medicare Part A provides coverage for the first three pints of blood each year, skilled nursing facility care, and hospice care. It does not provide prescription drug coverage.

Which type of Medicare supplement policy provides that as long as the insured pays the premiums, the insurer cannot modify the premium, coverage, or any provisions of the policy?

guaranteed renewable conditionally renewable *noncancelable* renewable at insurer's option If a policy is noncancelable, the insured can continue the same coverage, with no change in policy terms and no change in premium rates, so long as he or she continues to pay premiums on time.

Which type of long-term care provides support to the caregiver of a person who requires long-term care assistance?

homemaker care interval care adult day care *respite care* Respite care refers to providing temporary support to the primary caregiver of an aged, disabled, or handicapped individual by taking over that person's tasks for a limited time in the insured's home.

Jeremy received the following home health care services: housekeeping, shopping, custodial care, and physical therapy. Which of these services will be covered by Medicare Part A?

housekeeping custodial care *physical therapy* shopping Part A does not pay for homemaker services such as housekeeping, shopping, and cleaning. It also does not pay for custodial care, but it will pay for physical therapy received in the home if certain requirements are met.

Besides the elderly, who else receives Medicaid assistance?

illegal aliens who are not eligible for Medicare middle-income people who are not eligible for Medicare any American who is not eligible for Medicare *children who are not eligible for Medicare* Medicaid also covers children who are not eligible for Medicare.

Janet's long-term care policy contains a waiver of premium provision, which means that she can stop paying premiums when she

is ill. *begins receiving long-term care benefits under her policy.* becomes eligible for Medicare-Aid. spends down her assets to $2,000 or less. A waiver of premium provision allows insureds to stop paying premiums when they start receiving long-term care benefits under their policies.

What is another name for Medicare supplement policies?

major medical *Medigap* Medicaid Original Medicare Medicare supplement policies are also known as Medigap policies. Medicaid is a separate program, distinct from Medicare, which provides health care and health-related services to people with low incomes. Original Medicare is Medicare Parts A and B. Major medical is medical expense insurance.

Which type of health insurance plan is particularly suitable for the senior insurance market?

managed care term insurance *Medicare plans* long-term care Medicare is a federal health insurance program designed for people who are 65 years old and older and certain disabled individuals.

A Medicare Medical Savings Account is comprised of which of the following?

managed care Medicare plan and a savings account Medicare savings account only *high-deductible Medicare plan and a savings account* a special type of Medicare Advantage plan only Medicare Medical Savings Accounts (MSAs) are a type of Medicare Advantage plan that has two components: a savings account and a high-deductible Medicare health plan.

Following a hospital stay, Randall received a bill for the following expenses while in the hospital: $300 for dental care, $250 for meals, $5,000 for the cost of the room, and $1,000 for physical therapy. Which of these expenses will NOT be covered by Medicare Part A?

meals inpatient physical therapy *dental care* cost of the hospital room Part A helps cover inpatient care in hospitals (such as critical access hospitals, inpatient rehabilitation facilities, and long-term care hospitals). Meals, inpatient physical therapy, and the cost of a room would all be covered expenses.

Jason qualifies as a Specified Low-Income Beneficiary under North Carolina's Medicare-Aid program. Which benefit will he receive?

payment of the Part B premium, deductibles, and coinsurance amounts payment of the Parts A and B premiums payment of the Part B premium and deductibles *payment of the Part B premium* Medicare-Aid will pay the monthly Medicare Part B premiums for individuals who qualify as Specified Low-Income Beneficiaries.

A long-term care insurance policy issued in North Carolina cannot exclude coverage or limit benefits for which of the following?

pre-existing conditions *Alzheimer's disease* alcoholism and drug addiction service in the armed forces Long-term care policies cannot exclude or limit benefits by type of illness, particularly Alzheimer's disease. However, they can exclude pre-existing conditions, alcoholism and drug addiction, and illness, treatment, or medical conditions arising from service in the armed forces.

What is Medicare Part A designed to cover the costs of?

prescription drugs physician fees long-term care *hospitalization* Medicare Part A is primarily intended to cover the costs associated with hospitalization. To a limited degree, it also covers home health care, hospice care, psychiatric hospital care, and up to 100 days of care in a nursing home following a hospital stay.

What must Medicare supplement policies do whenever Medicare adjusts its deductibles and copayment requirements?

reduce benefits to avoid duplicating Medicare's adjustments *align benefits to match the adjustments* increase benefits to exceed Medicare's deductibles and copayment requirements maintain benefits Medicare supplement policies must align their benefits to match Medicare's adjustments to deductible and copayment requirements.

Peter is considered a dual eligible in North Carolina. He can expect to receive benefits for all of the following EXCEPT:

reduced co-payments on prescription drugs coverage for vision care premiums for Part B *nursing home care in a private room* A dual eligible person will receive coverage under Medicaid for nursing home care but not for a private room. A dual eligible person will also receive benefits for vision care, reduced co-payments for prescription drugs, and assistance in paying premiums for Part B.

Which of the following levels of long-term care provides continuous, 24-hour care delivered by licensed medical professionals, under the direct supervision of a doctor or physician?

remedial care *skilled nursing care* intermediate care custodial care Skilled nursing care is continuous, 24-hour care delivered by licensed medical professionals, under the direct supervision of a doctor or physician.

Which of the following levels of long-term care is usually delivered in a nursing home, but depending on the individual case, can also be provided in one's home or a community-based center?

remedial care skilled nursing care *intermediate care* custodial care Intermediate care is usually delivered in a nursing home, but depending on the individual case, it can also be provided in one's home or in a community-based center.

Which of the following levels of long-term care provides ongoing care that is necessary to address a person's condition but is not needed 24 hours a day?

remedial care skilled nursing care *intermediate care* custodial care Intermediate care provides ongoing care necessary to address a person's condition but is not needed 24 hours a day.

Which of the following levels of long-term care is provided to help a person meet daily living requirements, like bathing, dressing, or eating?

remedial care skilled nursing care intermediate care *custodial care* Custodial care is provided to help a person meet daily living requirements, like bathing, dressing, or eating.

Congress amended the law regarding Medicaid spend-down rules to eliminate what problem?

spousal abuse spousal participation *spousal impoverishment* spousal abandonment At one time, requiring applicants for Medicaid benefits to spend themselves into near poverty had the unintended consequence of also impoverishing the community spouse. Today, spouses are protected from what is termed "spousal impoverishment."

The premium for Abby's Medicare supplement policy was based on her age on the date of policy issue. Ten years later, the insurer increased the premium because of inflation but could not increase it due to her age. On what basis was Abby's policy issued?

target age attained age community rated *issue age* When an insurer uses an issue-age method for setting premiums, it bases the premium on the applicant's age when he or she buys the Medigap policy. While premiums may increase because of inflation and other factors, they will not change because of the policyowner's age.

The premium for Abby's Medicare supplement policy was based on her age on the date of policy issue. Ten years later, the premium increased $100 due to her age. On what basis was Abby's policy issued?

target age community rated issue age *attained age* When a premium is based on a person's attained age, the premiums will increase as a person gets older. Premiums for policies issued on an issue-age basis will not increase because of age.

A long-term care policy may exclude coverage for pre-existing conditions for how many months after the effective date of coverage?

three nine five *six* Pre-existing conditions need not be covered within six months following the effective date of coverage. Long-term care insurance policies may not exclude, limit, or reduce coverage or benefits for specifically named pre-existing diseases or physical conditions beyond six months following the effective date of the insured's coverage.

Jamie is 64 years old and will be enrolling in Medicare this year. How long is the initial enrollment period for enrolling in Parts A and B?

three months four months six months *seven months* The initial enrollment period for Parts A and B is seven months, which begins three months before a person's 65th birthday, includes the month he or she turns 65, and ends three months later.

When a person applies for Medicaid, the limits and the types of income and assets counted vary depending on:

whether the applicant is at least 65 years of age whether the applicant previously applied for Medicaid assistance *whether the applicant has a spouse who needs support* whether the applicant has relatives who require support The limits and the types of income and assets counted vary depending on, among other things, whether the applicant has a spouse who requires support.