Health Insurance Chapter 7 Group Health Insurance

An employee insured under a group health plan has been paying $25 monthly premium for his group health coverage. The employer has been contributing $75, for the total monthly cost of $100. If the employee leaves the company, what would be his maximum monthly premium for COBRA coverage? A $102 B $25 C $25.50 D $100

102 - The employer is permitted to collect a premium from the terminated employee at a rate of no more than 102% of the individual's group premium rate (in this scenario, 102% of $100 total premium is $102). The 2% charge is to cover the employer's administrative costs.

In cases where a covered employee is eligible for Medicare benefits to treat end-stage renal disease (ESRD) with dialysis or kidney transplant, which of the following is correct? A Medicare is primary for the first 12 months of treatment and the employer group insurance is secondary. B Medicare is the secondary payer during the first 30 months of treatment. C Medicare and the employer group insurance plan will share the cost equally. D Because Medicare does not cover treatment of ESRD, the group plan will pay 100%.

Medicare is the secondary payer during the first 30 months of treatment. - Individuals eligible for Medicare because of end-stage renal disease (ESRD) and covered under the employer's group plan are primarily covered by the group health coverage for the first 30 months, then Medicare would become the primary health provider.

Can a group that is formed for the sole purpose of obtaining group insurance qualify for group coverage? A No, the group must be formed for a purpose other than obtaining group insurance. B No, a group of individuals cannot apply for group coverage unless represented by an association or trust. C Yes, any group can apply for group coverage. D Yes, but only if the group is over 35 people.

No, the group must be formed for a purpose other than obtaining group insurance. - ! In order to qualify for group coverage, the group must be formed for a purpose other than obtaining group insurance; the coverage must be incidental to the group.

What provision may allow a small employer health benefit plan to exclude coverage for a pregnancy existing on the effective date of the coverage? A Adverse selection B Open enrollment C Pre-existing condition D Specified disease coverage

Pre-existing condition - A pre-existing condition provision in a small employer health benefit plan may exclude coverage for a pregnancy existing on the effective date of the coverage.

What is the purpose of the ADEA? A To prohibit age discrimination in employment B To ensure employees receive pension and other benefits C To promote employment of minorities D To allow leave to employees for family needs

To prohibit age discrimination in employment - The Age Discrimination in Employment Act of 1967 serves to promote employment of older persons based on their ability rather than age, to prohibit arbitrary age discrimination in employment; to help employers and workers, and to find ways of meeting problems arising from the impact of age on employment.

What is the purpose of COBRA? A To protect the insureds against insolvent insurers B To provide continuation of coverage for terminated employees C To provide coverage for the dependents D To provide health coverage for people with low income

To provide continuation of coverage for terminated employees - The Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) requires any employer with 20 or more employees to extend group health coverage to terminated employees and their families after a qualifying event.

An insured has a primary group health plan and an excess plan, each covering losses up to $10,000. The insured suffered a loss of $15,000. Disregarding any copayments or deductibles, how much will the excess plan pay? A $10,000 B$ 7,500 C $5,000 D $0

5,000 - Once the primary plan has paid its full promised benefit, the insured submits the claim to the secondary, or excess, provider for any additional benefits payable.

In a group policy, the contract is between A. Employer and Insurance Company B Employer and Employee

Employer and Insurance Company

After a person's employment is terminated, it is possible to obtain individual health insurance after losing the group health coverage provided by the employer. Which of the following is NOT true? A The employee can convert from group to individual insurance within 31 days of termination. B The premium of the individual health insurance policy can be higher than the original policy. C By law, the new, individual policy must provide the same benefits as the group insurance policy. D Continuation of group coverage need not include dental, vision, or prescription drug benefits.

By law, the new, individual policy must provide the same benefits as the group insurance policy. - Terminated employees have 31 days to convert to an individual health insurance policy, without having to provide proof of insurability. The insurer can adjust the new, individual health policy's premium as it sees fit, as long as coverage is provided. The new policy could offer lesser benefits than the original group health policy.

Jason is insured under his employer's group health insurance. He splits the cost of the premiums with his employer. This is an example of A A co-pay plan. B A contributory plan. C A noncontributory plan. D A half and half plan.

Contributory plan - With a contributory plan the eligible employees contribute to payment of the premium (both the employee and employer pay part of the premium).

What is the benefit of experience rating? A It allows employers with high claims experience to obtain insurance. B It allows employers with low claims experience to get lower premiums. C It helps employers with high claims experience to get group coverage. D It helps employees with low claims experience to become exempt from group premiums.

It allows employers with low claims experience to get lower premiums. - Group health insurance is usually subject to experience rating where the premiums are determined by the experience of this particular group as a whole. Experience rating helps employers with low claims experience because they get lower premiums.

Which of the following statements is NOT correct concerning the COBRA Act of 1985? A It applies only to employers with 20 or more employees that maintain group health insurance plans for employees. B COBRA stands for Consolidated Omnibus Budget Reconciliation Act. C It requires all employers, regardless of the number or age of employees, to provide extended group health coverage. DI t covers terminated employees and/or their dependents for up to 36 months after a qualifying event.

It requires all employers, regardless of the number or age of employees, to provide extended group health coverage. - COBRA Act applies to only employers with 20 or more employees.

The classification Small Employer means any person actively engaged in a business that on at least 50% of its working days during the preceding year employed A No more than 50 employees. B At least 10 and not more than 100 employees. C No more than 25 employees. D At least 3 and not more than 25 employees.

No more than 50 employees. - Classification rules established by the Insurance Code state that Small Employer means any person actively engaged in a business that on at least 50% of its working days during the preceding year employed not more than 50 eligible employees.

In a group policy, the contract is between A The employer and the union. B The employee and the employer. C The employer and the insurance company. D The individual and the insurance company.

The employer and the insurance company. - ! In a group policy, the contract is between the insurance company and the group sponsor (such as employer, union, trust, or other sponsoring organization).

In a group policy, who is issued a certificate of insurance? A The health care provider B The insurance company C The employer D The individual insured

The individual insured - The individuals covered under a group insurance contract are issued certificates of insurance. The certificate tells what is covered in the policy, how to file a claim, how long the coverage will last, and how to convert the policy to an individual policy.

What is the purpose of a Medicare Carve-out or Supplements? A They act as excess insurance paying those covered expenses not paid by Medicare because of previous disabilities. B They pay deductibles or copayments that are not paid by Medicare. C They act as replacement insurance for Medicaid. D They pay for excess expenses not paid by Medicare because of pre-existing conditions.

They pay deductibles or copayments that are not paid by Medicare. - Medicare carve-out and supplements act as excess insurance paying those covered expense not paid by Medicare because of deductibles or copayment requirements.