College personal finance
What is a typical copayment amount for individuals?
20-40
How much does a private income insurance program pay for loss of normal income from a disability?
40-60%, with some plans paying up to 75%
A policy that pays you back for actual expenses is called
A reimbursement plan
Which of the following is incorrect?
All disability policies pay you if you cannot work at your regular job.
Which of the following is TRUE about long-term care insurance?
All else held constant, the older you are when you enroll, the higher the annual premium.
Which of the following about individual health insurance policies is NOT correct?
All insurance companies that offer this type of policy are required to charge the same rates
The duration of benefits for a disability income insurance plan can be
All of these are possibilities
All of the following are sources of disability income except
All of these are sources of disability income
The Patient Protection and Affordable Care Act of 2010
All of these are true.
Medicaid covers
All of these choices are correct.
Which of the following activities is NOT a step being taken to reduce health care costs?
All of these steps are being taken to reduce health care costs.
Who is most likely to use a home health care agency?
An elderly neighbor.
This health insurance provision lets your insurer make direct payments to your doctor or hospital.
Assigned benefits
Rising health costs are due to all of the following except
Baby boomers using fewer health care services
Brittany and Brandon are both charged $250 for an office visit to the same specialist. Brittany's reimbursement policy has a deductible of $300. Once she has met the deductible, the policy will cover the full cost of her visits. Brandon's indemnity policy will pay him $150, the maximum amount his plan provides for a visit to any specialist. Which of the following is correct?
Brittany will pay more because she must pay the entire bill since she has not met her deductible while Brandon will have part of his bill paid by his policy.
Nancy is studying the health insurance plan options offered by her employer. She wants a policy that will have the insurance pay a percentage of her medical expenses after she meets her deductible. She should review the
Coinsurance
The coordination of benefits provision applies to
Combining the benefits of two insurance policies issued for a married couple.
The insurance that helps pay hospital, surgical, medical, and other bills with a low deductible is known as a(n)
Comprehensive major medical policy
COBRA stands for
Consolidated Omnibus Budget Reconciliation Act
Jenny wants health insurance that sets the amount that she must pay toward medical expenses before the insurance starts paying benefits. She is concerned about a
Deductible
The set amount that you must pay toward medical expenses before the insurance company pays benefits is called a(n):
Deductible
Miguel is concerned that the health insurance option he is considering plays upon unrealistic fears. He is most concerned about a
Dread disease policy
Which of the following is INCORRECT about dread disease policies?
Each policy covers a wide range of conditions
Under the Patient Protection and Affordable Care Act of 2010, which of the following is NOT correct?
Employers must offer continuing coverage through COBRA for up to 24 months after you leave your job
Anna contributes pretax dollars to an account managed by her employer for her health care expenses. If she does not spend all of her money by the end of the year, she may forfeit it. What kind of plan does she have?
FSA
If you are concerned that your disability insurer may try to cancel your coverage if your health becomes poor, you should look for a plan that offers
Guaranteed renewability
Monica's employer offers a health insurance plan with a very high deductible. In addition, her employer provides a fund for her to spend specifically on health care. What kind of plan does she have?
HRA
Jacob is concerned that his out-of-pocket health care expenses will be quite high, so he is considering adding contributions to a tax-free account that he can use with his high-deductible policy to cover catastrophic expenses. What kind of plan does he have?
HSA
Cameron, age 25, sustained a debilitating hand injury and was unable to perform his job as a viola player in the local orchestra for 45 days. His employer has a disability income insurance policy that pays 70% of take-home pay with an elimination period of 60 days and coverage to age 65. Given this information, which of the following is true for Cameron?
He will not be eligible for any disability income because his disability ended before the elimination period ended.
Which of the following is correct?
Health insurance plans may reimburse an individual for hospital stays, doctors' visits, and medications
Steve's employer offers a health plan that stresses preventive services and covers routine immunizations and checkups, screening programs, and diagnostic tests. What kind of plan does his employer offer?
Health maintenance organization (HMO
The type of health insurance coverage that pays for some or all of the daily costs of room and board during a hospital stay is
Hospital expense
Medicare (Part A) covers
Inpatient hospital care.
A provision in a health insurance policy that sets specific levels of repayment for certain services is called a(n)
Internal limit
This health insurance provision sets specific levels of repayment for certain services
Internal limits
A health insurance plan should include all of the following "must-haves" except:
Lifetime maximum coverage of up to $50,000
The type of health insurance coverage that takes up where basic health insurance coverage leaves off is
Major medical expense
Jack needs comprehensive medical coverage. However, his income is very low. What plan should he investigate?
Medicaid
A Medigap policy fills the gap between Medicare payments and medical costs not covered by:
Medicare
Individuals over the age of 65 who are eligible for Medicare may also be interested in purchasing more coverage called
Medigap
Which of the following is NOT a type of health insurance available to individuals or employees?
Minor medical indemnity insurance
After you have reached a certain limit that you must pay for the deductible and coinsurance, the insurance company covers 100% of any additional cost. This is called a(n)
Out-of-pocket limit.
The type of health insurance coverage that may cover routine doctor visits, X-rays, and lab tests is
Physician expense
This type of plan combines features of health maintenance organizations and PPOs. It uses a network of participating physicians and medical professionals who have contracted to provide services for certain fees
Point-of-service (POS) plan
Yvonne's employer offers a health plan that has a group of doctors and hospitals that agree to provide specified medical services to members at prearranged fees. This health plan offers some flexibility since members can either visit a physician from a list or go to their own doctors. What kind of plan does her employer offer?
Preferred provider organization (PPO)
All else held constant, which of the following is typically true about an elimination period?
Premiums for a plan with an elimination period of 90 days will be less than premiums for a plan with an elimination period of 60 days.
A health insurance policy with this provision lists coverage in terms of services, not dollar amounts.
Service benefits
The Health Insurance Portability and Accountability Act of 1996
Sets federal standards to ensure that workers do not lose their health insurance if they change jobs
Mark was severely injured while on vacation and expects to be unable to work for at least 12 months. Because of his injury, he should expect to be eligible for disability income from
Social Security
Blue Cross and Blue Shield are
Statewide organizations
Fran is interested in purchasing a major medical policy that limits the total out-of-pocket amount that she will have to pay. She should consider a
Stop-loss provision
The type of health insurance coverage that may specify the maximum payment amount for each type of operation is
Surgical expense
In which circumstances may the right to elect continued coverage under COBRA exist for a covered spouse or dependent?
The right exists in all of these circumstances.
Which of the following about individual health insurance policies is correct?
They are available for the self-employed or others who are dissatisfied with the coverage that their group plan provides.
What is the primary purpose of medical expense insurance?
To pay actual medical costs for illness or injury.
Which of the following is NOT an underlying cause of high health care costs?
Victims of accidents and crimes require fewer emergency medical services than in the past
Katrina was injured in an accident at work. The benefits she will receive to cover part of her income will come from
Worker's compensation.
A flexible spending account (FSA) is typically funded solely by an employer.
false
A health insurance policy that pays you back for actual expenses is called an indemnity policy
false
A premium is a set amount you must pay toward medical expenses before the insurance company pays benefits.
false
A summary plan description outlines the disadvantages of your health plan along with your legal rights under the Employee Retirement Income Security Act
false
Administrative costs in the United States consume half of the health care dollars spent.
false
All group health insurance plans provide the same level of protection
false
An employer self-funded health plan requires a low level of financial assets.
false
Blue Cross and Blue Shield are two types of health maintenance organizations
false
Disability income insurance covers your medical expenses when you are disabled.
false
Disability income insurance policies are required to provide benefits for disabled policyholders until age 65.
false
Everyone qualifies for COBRA
false
Health care costs have decreased because of aging baby boomers using fewer health care services.
false
Health insurance is a form of protection that eases the financial burden people may experience as a result of someone's death
false
Long-term care insurance is used to pay for a stay in a nursing home but not for help at home.
false
Medicare is offered to certain low-income individuals and families.
false
Medicare typically covers routine checkups
false
The United States has the fifth highest per capita medical expenditures of any country in the world.
false
The benefit limits provision identifies the minimum benefits that will be paid for days spent in the hospital
false
The copayment provision deals with the amount that someone will pay for a bill such as 20% coinsurance
false
The financial problems caused by death are greater than those caused by disability.
false
The period before you can receive benefits in a disability plan is called the probationary period.
false
Which of the following is a government health care program?
medicare
Most people receive health insurance under a group plan from
their employer
A Medicare Advantage Plan (Part C) combines your Part A (Hospital) and Part B (Medical) coverage into one plan.
true
A PPO is a group of doctors and hospitals that agree to provide health care at rates approved by the insurer.
true
A deductible is a set amount you must pay toward medical expenses before the insurance company pays benefits.
true
A disability income insurance plan typically pays out if you cannot work at your regular job due to pregnancy, a non-work related accident, or an illness.
true
A disability policy with a longer elimination period typically charges lower premiums than a policy with a short elimination period
true
A health insurance policy that pays you back for actual expenses is called a reimbursement policy
true
A health insurance policy that pays you back for actual expenses is called a reimbursement policy.
true
A health reimbursement account (HRA) is funded solely by your employer and gives you a pot of money to spend on health care
true
Administrative costs in the United States consume nearly 26% of health care dollars spent.
true
As health care costs continue to grow, it is projected that the Medicare program will be bankrupt by the year 2035 if no changes are made.
true
FSAs and HSAs provide tax advantages for health care expenses.
true
If you are unemployed and cannot afford health insurance, then you may be eligible for an affordable health insurance plan through the Health Insurance Marketplace.
true
Long-term care insurance is used to pay for a stay in a nursing home and to provide for payment of home care help with daily activities
true
Managed care health plans include Health maintenance organizations, PPOs, and POSs.
true
Surgical expense insurance pays all or part of the surgeon's fees for an operation in a doctor's office
true
The Health Insurance Portability and Accountability Act of 1996 set new federal standards to ensure that workers would not lose their health insurance if they changed jobs.
true
The Patient Protection and Affordable Care Act of 2010 requires health insurance companies to submit justification for all requested premium increases
true
The United States has the highest per capita medical expenditures of any country in the world.
true
With a guaranteed renewable provision in a health insurance policy, the insurer is permitted to raise premiums only if they do so for all members of a group.
true
Workers are considered disabled if they have a physical or mental condition that prevents them from working and that is expected to last for at least 12 months or to result in death.
true
