Chapter 13/1: Medical Expense Insurance

Base plans:

Base plans offer first-dollar coverage. Base plans do not have cost-sharing mechanisms (deductibles and coinsurance). Low limits for catastrophic coverage are provided. Nowadays, base plans are essentially outdated and have been replaced by managed care plans. The correct answer is: Offer first-dollar coverage

Which is not a characteristic of basic medical plans?

Base plans provide first-dollar coverage, which means they do not have coinsurance or deductibles. The correct answer is: Coinsurance

Which of the following medical plans has essentially replaced the outdated base plans?

Base plans, major medical and comprehensive plans, are outdated in the modern insurance market. Managed care plans have essentially replaced these plans. The correct answer is: Managed care

Which basic plan covers costs an insured incurs while confined to a hospital, including room and board, nursing care, X-rays, lab fees, operating and treatment room, oxygen, blood, medications and general anesthesia?

Basic hospital covers costs an insured incurs while confined to a hospital, including room and board, nursing care, X-rays, laboratory fees, operating and treatment room, oxygen, blood, medications, and general anesthesia. Basic hospital plans essentially cover all costs on a hospital bill except for physician's fees and surgeries. The correct answer is: Hospital

Which is not a limited medical expense policy?

Basic hospital expense is not a limited policy. The correct answer is: Basic hospital expense

All of the following are limited medical expense policies, EXCEPT:

Basic hospital is not a limited policy. The correct answer is: Basic hospital

Which of the following plans covers physician's fees?

Basic medical covers nonsurgical physician's fees for accidental injury or sickness. The correct answer is: Basic medical

Which plan covers physician's fees?

Basic medical covers nonsurgical physician's fees for accidental injury or sickness. The correct answer is: Physician's nonsurgical expense

Which of the following is true regarding taxation of medical expense plans?

Benefits from medical expense plans are not taxed. The correct answer is: Benefits are not taxed.

Mary is in a car accident and requires surgery to repair her fractured leg. Which policy will not pay for her hospital expenses?

Disability income policies pay for lost income caused by a disability, not medical expenses. The correct answer is: Disability income

All of the following are covered costs under a basic hospital plan, EXCEPT:

Infertility treatment is typically excluded under base plans. The correct answer is: Infertility treatment

What type of insurance plan covers medical care costs, such as physician's fees, surgical fees, and prescription drugs?

Medical expense insurance covers all types of costs of medical care. It does not cover disability income. The correct answer is: Medical expense insurance

Barbara is looking at both individual and group medical coverages - for herself and her company. She has learned that medical expense plans may be offered as:

Medical expense policies are available as individual and group plans. The correct answer is: Individual or group coverages

All of the following are ways medical expense policies pay benefits, EXCEPT:

Medical expense policies may pay benefits in the following ways: reimbursement (expense-occurred), where the policyholder is reimbursed for the cost of medical care; service basis, where providers are paid directly by the insurer; or on an indemnity basis, where the policy pays a fixed amount regardless of the cost of medical care. Disability income policies pay benefits on a valued basis. The correct answer is: Valued

Most medical expense plans have:

Most medical expense plans have coinsurance and deductibles, which require the insured share in the cost of medical care. The correct answer is: Coinsurance and deductibles

Which basic plan covers surgical costs including surgeon fees, anesthesia, and post-surgery recovery?

The basic surgical expense plan pays surgical costs including surgeon fees, anesthesia, and post-surgery recovery. The correct answer is: Surgical

How is the miscellaneous expenses coverage under basic hospital medical expenses paid?

The miscellaneous or ancillary benefit under basic hospital medical expense policies covers all other costs aside from room and board. The miscellaneous benefit is stated as a multiple of the daily room and board limit. The correct answer is: A multiple of the room and board benefit

The two categories of basic hospital medical expense coverage are:

There are two categories of basic hospital expense benefits: room and board and miscellaneous. The correct answer is: Room and board and miscellaneous expenses

Which term correctly describes a nonscheduled plan of charges for basic surgical plans?

Usual, customary and reasonable surgical charges are based on average charges in a particular geographic area. The correct answer is: Usual, customary and reasonable

Medical expense plans cover:

Where disability income policies are designed to insure only a working individual, medical expense plans are designed to cover an individual or a family. The correct answer is: An individual, family, or group of individuals