Health Insurance End of Chapter Quizes

Medicare does not pay for treatment: a) In southwestern states b) Outside the U.S. c) In states that have domestic private carriers d) All of the above

b

Which of the following best describes insurance? a) The transfer of risk b) The increase in the chance of loss c) The uncertainty of loss d) The pooling of funds in order to receive appreciation

a

Which of the following involves the care of tissue surrounding the teeth? a) Periodontics b) Endodontics c) Orthodontics d) Prosthodontics

a

Which of the following types of disability income policies excludes losses arising out of the occupation of the insured for which the insured is entitled to received Workers' Compensation benefits? a) Non occupational b) Occupational c) Presumptive d) Residual

a

A business overhead expense policy provides disability income protection for the owner of the business. All of the following are covered expenses under a BOE policy, EXCEPT: a) Employee salary b) Employer salary c) Utilities d) Rent

b

A legal relationship between two parties when one of the parties acts on behalf of another is known as: a) Authority b) Agency c) Fiduciary capacity d) Declaratory judgment

b

A policy paying benefits on a relative value basis is most probably a: a) Hospital expense plan b) Surgical expense plan c) Dread disease plan d) Physician's expense plan

b

A waiting period in a disability income policy is also referred to as: a) Probationary period b) Elimination period c) Recurrent period d) Waiver period

b

All of the following are types of presumptive disability, EXCEPT: a) Loss of sight b) Loss of income c) Loss of speech d) Loss of use

b

An employee actively at work on the date coverage is transferred to another insurance carrier is: a) Covered following a thirty-day waiting period b) Covered automatically and exempt from any probationary period c) Covered automatically but subject to a probationary period d) Covered subject to the preexisting condition limitation

b

An insurer owned by its policyholders without capital stock best describes? a) A stock company b) A mutual company c) An alien company d) A reciprocal company

b

An insurer that is chartered in the State of New Jersey and is authorized in Pennsylvania is referred to in the latter State as which of the following? a) Domestic insurer b) Foreign insurer c) Alien insurer d) Nonadmitted insurer

b

An underwriter derives information from all of the following sources, EXCEPT: a) The application b) The beneficiary c) MIB report d) Consumer report

b

Disability benefits paid by Social Security are based on the disabled workers: a) Attained age b) Primary insurance amount c) Social Security benefit d) Unearned income

b

Disability benefits will be paid to a covered worker if he meets the definition of total disability utilized by Social Security. A worker is eligible if he is unable to engage in: a) His own occupation b) Any occupation c) His trade or job d) A fully insured status

b

Disability income is one type of accident and health insurance contract. Which of the following is covered by this type of policy? a) Incurred medical expenses b) Loss of income due to illness c) Injury suffered off the job d) Cost associated with surgery

b

Disability income policies protect an insured's loss of income. Which of the following is not considered earned income that may be covered under a disability income policy? a) Income from the job performed b) Income from rents c) Commissions from sales d) Wages paid by employer

b

Each of the following are supplements or optional coverages that may be added to HMO coverage, EXCEPT? a) Home health services b) Emergency treatment c) Long-term care d) Pharmacy services

b

Each of the following is excluded by Blue Cross/Blue Shield coverage, EXCEPT: a) Injury as a result of committing a felony b) Dental care resulting from an accident c) Intentionally self-inflicted injuries d) Routine examination costs

b

If a business pays the premium on a short term disability policy covering a key employee, receives the monthly benefit and pays the disabled employee, the benefit to the employee is: a) Nontaxable b) Taxable as ordinary income c) Taxable as recaptured income d) Tax exempt to the employee

b

If a covered worker qualifies for disability benefits under Social Security, monthly income benefits would begin after a waiting period of: a) Three months b) Five months c) Six months d) Eight months

b

If an employee covered by a group medical expense plan dies, his family may continue coverage under the group plan for: a) 18 months b) 36 months c) 60 months d) 120 months

b

If one party makes an offer and another party makes a counter offer, the initial offer is: a) Accepted b) Off the table c) Negotiated d) A stalemate

b

In most major medical policies, if an insured's 20-year old son drops out of college, will he continue to be covered under his parent's major medical policy? a) No, since coverage for dependent children terminates at age 19 b) No, since he is no longer a full-time student c) Yes, as long as he continues to live in his parent's household d) Yes, as long as the proper premium is paid

b

Medicare Supplement policies may not include a pre-existing condition limitation that exceeds: a) Three months b) Six months c) Nine months d) Twelve months

b

Medicare Supplement policies must include a right to examine provision of: a) Twenty days b) Thirty days c) Forty-five days d) Sixty days

b

The goal of a Preferred Provider Organization is: a) Make health care available to all b) Channel patients to providers that discount medical services c) Reduce the preexisting condition period of a new health plan d) Limit the cost of health care paid by employers

b

The statements made by an applicant in an insurance application are considered to be: a) Warranties b) Representations c) Misrepresentations d) Countersignatures

b

What is issued to an employer when it desires to seek coverage for employees through a MET or MEWA? a) Satisfactory agreement b) Joinder agreement c) Joint venture d) Summary judgment

b

What type of disability income policy may have its premium increased for an entire class of policies? a) Non cancelable b) Guaranteed renewable c) Conditionally renewable d) Guaranteed retractable

b

When employees are actively at work on the date coverage can be transferred to another insurance carrier, which of the following occurs? a) The risk must be reevaluated b) Deductibles and coinsurance are carried over to the new plan c) The deductible is carried over to the new plan d) The coinsurance amount is carried over to the new plan

b

Which of the following disability policies will provide greater benefits if an insured is injured off the job? a) Occupational policy b) Non occupational policy c) Limited policy d) Restricted policy

b

Which of the following involves treatment of diseases connected with dental pulp within the teeth? a) Periodontics b) Endodontics c) Orthodontics d) Prosthodontics

b

Which of the following is an example of an endodontic procedure? a) Tooth extraction b) Root canals c) Retainers and braces d) Dentures and bridgework

b

Which of the following is not a type of preventive care? a) Family planning b) Chemotherapy c) Well baby care d) Prescription drugs

b

Which of the following provides for the availability of health insurance benefits for small companies with common employments which band together? a) Multiple funded plans b) Multiple employer trusts c) Multiple employment associations d) Long term care associations

b

Which of the following types of authority is an extension of a producer's regular duties? a) Express b) Implied c) Apparent d) Warranted

b

What is the function of a third party administrator? a) To market insurance products b) To process commissions c) To issue insurance polices d) To manage claims

d

What is the primary purpose of a medical expense insurance deductible? a) To increase the total premium b) To broaden policy benefits c) To reduce policy limitations d) To eliminate smaller claims

d

What type of rider may be added to a disability income policy which allows the insured to purchase additional amounts of disability insurance without a medical exam? a) Cost of living b) Accidental death c) Social Security d) Guaranteed insurability

d

Which of the following arc required signatures that must appear on an insurance application? a) Policyholder and agent b) Claimant and agent c) Beneficiary and agent d) Agent and applicant

d

Which of the following best identifies the parties involved in an insurance contract? a) Beneficiary and policyowner b) Insurer and producer c) Producer and policyowner d) Policyowner and insurer

d

Which of the following is based upon a fee for service approach? a) Blue Cross and Blue Shield b) Health Maintenance Organization c) Individual disability plan d) Major Medical plan

d

Which of the following supports the theory of indemnity? a) Exclusions b) Reductions in coverage c) The law of large numbers d) No loss, no gain statutes

d

All health policies include a renewability provision. Which of the following provides an insured with the most advantageous provision? a) Noncancelable b) Guaranteed renewable c) Cancelable d) Conditionally renewable

a

An authorized company whose principal office is located in this State and operates in this State is known as: a) A domestic company b) A foreign company c) An alien company d) A nonadmitted company

a

An insurance contract is created by an insurer. Any ambiguities that appear in the future will be decided by a court in favor of the insured since the policy is: a) A contract of adhesion b) An aleatory contract c) A unilateral contract d) A personal contract

a

Bill is covered by a comprehensive major medical plan providing basic first dollar coverage of $1,000. The policy also includes a $500 corridor deductible and coinsurance of 80/20. If Bill incurs covered expenses of $3,000, what will be his coinsurance amount? a) $300 b) $500 c) $800 d) $1,200

a

Direct writers employ: a) Captive agents b) Independent agents c) Professional insurance agents d) Independent contractors

a

Health insurance policies include an exclusion provision. All ofthe following would be excluded under an accident and health policy, EXCEPT: a) Self-inflicted injury b) Hearing examination c) Cosmetic medical expenses d) Eye examination

a

Once an insured is injured and notifies the insurer, the latter must send out a proof of loss form within: a) 15 days b) 20 days c) 30 days d) 90 days

a

Part B of Medicare is an optional coverage. Which of the following would not be covered by this portion of Medicare? a) Eye examination b) Office visit c) House call d) Outpatient charge

a

Relief to a primary care giver is provided by: a) Respite care b) Home health care c) Rehabilitation care d) Intermediate care

a

Services provided by a nurse midwife are covered when they occur: a) In a birthing center b) In a skilled nursing facility c) Prior to the policy period d) Following the policy period

a

The fact that an A&H premium payment of$500 must be paid is stipulated in which of the following parts of the policy? a) Insuring clause b) Beneficiary provision c) Premium payment d) Consideration clause

a

A long-term care policy provides coverage for which of the following? a) Hospital confinement b) Alzheimers disease c) Long-term disability d) Drug abuse treatment

b

Jack owns a disability income policy with a 60 day waiting period. He is disabled for three months, returns to work for three months, but has to go out on disability for three more months with the same injury. How many months' benefits will his policy pay? a) Two months b) Four months c) Six months d) Nine months

b

Medicare Advantage offers expanded benefits for an additional premium. In order to be eligible for this coverage, also known as Part C, which of the following is true ? a) An individual must be enrolled in Part A of Medicare b) An individual must be enrolled in Part A and Part B of Medicare c) An individual must be enrolled in Part A , B and D of Medicare d) An individual must be suffering from end-stage renal failure

b

Paul applies for a health policy on February 5th. Underwriting approves the application on February 12th. The policy is delivered by the agent on February 15th. When does the ten-day free-look period end? a) February 24th b) February 25th c) February 26th d) February 22nd

b

Premium determination of disability income policies are based on several criteria. Each of the following will influence disability income premiums, EXCEPT: a) Insured's age b) Mortality c) Waiting period d) Length of benefit period

b

Social Security is also known as: a) OSHA b) OASDHI c) OASHI d) PIA

b

Statements made by an applicant on a health insurance application are contestable by an insurer for an initial period of: a) One year b) Two years c) Three years d) Five years

b

The waiting period that must be satisfied before premiums will be waived under an accident and health contract is: a) Two months b) Three months c) Six months d) Nine months

b

What type of A&H policy can have its premiums increased for an entire class of policies? a) Noncancelable b) Guaranteed renewable c) Conditionally renewable d) Cancelable

b

When an insured suffers a covered illness, she must supply notice ofloss to the insurer. Once this notice is received by the insurer, it must send a proof of loss form to the insured within: a) 10 days b) 15 days c) 20 days d) 90 days

b

Which of the following long-term care benefits provides twenty-four hour care? a) Intermediate nursing care b) Skilled nursing care c) Home health care d) Custodial care

b

Which of the following would not be eligible for enrollment in the Medicare Prescription Drug plan ? a) A person age 63 who has been permanently disabled for three years b) A person age 66 who is not eligible for Social Security benefits c) A person in need of a kidney transplant d) Someone suffering from ALS

b

A policy owner may have his policy reinstated after a lapse if a reinstatement application is completed and approved. Once this application is submitted, an insurer must notify the insured of its approval or declination within: a) 30 days b) 31 days c) 45 days d) 60 days

c

According to the time of payment of claims provision, insurers must provide payment of disability income benefits not less frequently than: a) Daily b) Weekly c) Monthly d) Quarterly

c

All of the following are required uniform health insurance provisions, EXCEPT: a) Time of payment of claims b) Notice of claim c) Change of occupation d) Physical examination and autopsy

c

If an insurer pays an A&H claim but later finds that the insured was injured while engaging in an illegal activity, what action will it take? a) Increase the premium b) Deny the claim c) Attempt to recover the claim payment d) Deny the claim and return the premium

c

Joan buys a disability income policy. It insured her as a librarian. She later changes jobs and becomes a scuba diving instructor. What action will the insurer take with regard to her policy? a) It will be canceled b) The premium will be reduced c) The coverage will be reduced d) The coverage will be increased

c

Once a specific amount ofbenefit is initially covered by Part D of Medicare, a gap exists before more costs are covered. This gap in coverage that exists under the prescription drug plan is known as: a) The donut maker b) Catastrophic coverage c) A donut hole d) Whole life coverage

c

To be eligible for coverage under Part C ofMedicare, an individual does not have to prove that he or she is insurable if enrollment occurs during what period of time following the attainment of age 65 ? a) One month b) Three months c) Six months d) Twelve months

c

When will an individual be entitled to retirement income under Social Security? a) On his or her 65th birthday b) On the last day of the month in which he/she turns age 65. c) On the first day of the month in which he/she turns age 65. d) Age 62

c

Which of the following Medicare coverage sections provides managed health care? a) Part A b) Part B c) Part C d) Part D

c

Which of the following involves treatment concerning corrective devices for the teeth? a) Periodontics b) Endodontics c) Orthodontics d) Prosthodontics

c

Which of the following provisions is a required uniform health insurance provision? a) Misstatement of age b) Recurrent disability c) Legal action d) Conformity with state statutes

c

Written proof of loss must be supplied to an insurer within what period of time? a) 30 days b) 60 days c) 90 days d) 120 days

c

An insured suffers a covered illness. He or she must notify the insurer of the loss within: a) 5 days b) 10 days c) 15 days d) 20 days

d

In a health insurance policy, the policyholder's consideration is the: a) Premium paid b) Statements made on the application c) The original offer d) The premium paid and representations on the application

d

Policies providing hospice care benefits are not required to provide: a) Care for terminally ill patients b) Ambulance expenses c) Psychological treatment benefits d) Home health care

d

The entire contract provision is a required uniform policy provision. Which of the following statements is true regarding this provision? a) The entire contract consists of the health insurance policy b) The entire contract stipulates to whom a death benefit will be paid c) The entire contract provides for the payment of benefits within 90 days of the loss d) The entire contract consists of the health insurance policy and a copy of the original application

d

What health insurance provision allows an insurer to deny a claim if it finds that the insured concealed information about his health? a) Reinstatement b) Grace period c) Legal action d) Time limit on certain defenses

d

What is the purpose of an elimination period which appears in a Long-Term Care policy? a) To reduce an insured's loss ratio b) To guarantee that an insurer will provide benefits for everyone c) To enable an insurer to deny small pre-existing claims d) To allow an insurer to lower costs for everyone's benefit

d

Which of the following can a doctor use if he or she wants to find out prior to treatment being provided if such treatment is covered by an insured's medical plan? a) Concurrent review b) Retrospective review c) Comprehensive review d) Prospective review

d

Which of the following is an illustration of a prosthodontics procedure? a) Tooth extraction b) Root canals c) Retainers and braces d) Dentures and bridgework

d

Which provider is considered the secondary payor if an individual is covered by both Medicare and a group health insurance plan? a) Group health plan b) Long-term care c) Medicaid d) Medicare

d

Which of the following provides comprehensive insurance coverage? a) Vision care b) Dental care c) Medical expense d) Prescription drug benefits

c

A covered worker is considered to be "fully insured" if he or she possesses: a) 20 quarters of coverage b) 30 quarters of coverage c) 40 quarters of coverage d) 60 quarters of coverage

c

A fraternal offers various types of insurance programs for which of the following? a) For those who cannot obtain standard coverage b) For those over age 65 c) For their members only d) For labor unions and their members

c

All of the following are acts of daily living, EXCEPT: a) Moving about the home b) Dressing c) Breathing d) Bathing

c

All of the following are true regarding an HMO, EXCEPT: a) Requires a prepaid premium b) Focuses on preventive care c) Functions on a reimbursement basis d) Requires co-payment before service is provided

c

An employee is covered by a disability income policy paid by the employer. However, 10% of the premium is payroll deducted. If the employee is later disabled and collects a benefit for one month after the waiting period, what percentage amount of the monthly benefit will be taxable income? a) 10% b) 25% c) 90% d) 95%

c

An insured who is covered by a Blue Cross/Blue Shield plan is known as which of the following? a) A beneficiary b) A policyholder c) A subscriber d) A provider

c

Coverage for newborn infants is provided by a medical expense policy: a) When a child reaches age two b) When a premium is paid c) From the moment of birth d) 31 days following his or her birth

c

Deliberate or intentional deceit in making false statements is known as: a) Larceny b) Rebating c) Fraud d) Misrepresentation

c

Each of the following must be present in order for an insurance contract to be legal and enforceable, EXCEPT: a) Offer b) Acceptance c) Competent underwriting d) Legal purpose

c

If a POS member seeks medical care from a nonmember physician, payment is made to the provider on a: a) Reimbursement basis b) 80 I 20 basis c) Fee for service basis d) Coinsurance basis

c

If a person covered under a PPO seeks treatment outside the plan, what action might the organization take? a) Increase the premium for coverage b) Expel the insured from the group c) May reduce benefits d) Increase the number of exceptions

c

In order for a contributory group plan to be written, an insurer requires what percentage of participation from all eligible employees? a) 25% b) 50% c) 75% d) 90%

c

Joan is covered by a disability income policy as a clerical worker. One of her hobbies is hang-gliding. She later leaves her job to take a new position as an instructor for a hang-gliding school. How will this change affect her previously purchased disability policy? a) It will be canceled b) The policy premium will be increased c) The monthly benefit will be reduced d) The monthly benefit will be increased

c

Medicaid is a federally and state sponsored health program for needy and low income individuals. All of the following are true regarding Medicaid, EXCEPT: a) Medicaid provides aid to families with dependent children b) Medicaid provides health care for needy persons who are blind c) Medicaid is financed by Medicare d) The extent of covered costs varies by State

c

Medicare is a federally sponsored two part health insurance program. Each of the following medical services is covered under Part A of Medicare, EXCEPT: a) Home health care b) Skilled nursing care c) Physicians care d) Inpatient care

c

Medicare is financed through tax revenue. All of the following fund this program in some manner, EXCEPT: a) An employer b) A sole proprietor c) A beneficiary d) An employee

c

Surgical expense benefits are paid according to a: a) Reimbursement basis b) Prepaid limitation c) Schedule d) Stated offset

c

Under the definition of accidental means, the result and which of the following must be accidental? a) The injury b) The income loss c) The cause d) The illness

c

What is the purpose of the coinsurance clause? a) To lower claim amounts b) To aid an insurer in better servicing the insured c) To encourage an insured to share in the cost of care d) To provide long-term care to an insured

c

Which of the following best describes a comprehensive major medical policy? a) It is a combination of basic expenses and surgical expenses b) It combines major medical and limited policy protection c) It combines basic expenses and major medical protection d) It combines blanket protection and physician's expenses

c

Which of the following is an eligible dependent who may be covered by a group or individual medical expense plan? a) A legally separated spouse of the insured b) A married child living in the insured's household c) A step child of the insured d) The insured's twenty-six year old son living in the household

c

Which of the following is considered to be a voluntary relinquishment of a known right? a) Warranty b) Estoppel c) Waiver d) Parole evidence

c

Which of the following is the purpose of an accident and health policy's probationary period? a) Broadens policy benefits b) Allows for open enrollment c) Allows an insurer to deny small pre-existing claims d) Determines the lost ratio for an insurer

c

Which of the following policies pays a benefit if an insured suffers an illness due to cancer only? a) Accident only policy b) Sickness income policy c) Dread disease policy d) AD &D rider

c

A reciprocal is managed by which of the following? a) A branch manager b) A company officer c) A fraternal d) An attorney-in-fact

d

A statement made by an applicant for insurance that is guaranteed to be absolutely true and is made part of the contract is called a: a) Representation b) Conditional promise c) Consideration d) Warranty

d

According to HIPAA, employers must make full health care coverage available immediately to new employees who were previously covered by group health insurance at their old job for at least how many months? a) Six b) Eight c) Nine d) Twelve

d

All ofthe following are legally competent to enter into an insurance contract, EXCEPT? a) An individual who is past retirement age b) An emigrant who has lived in this country for five years c) An individual recently laid off from his job d) A twelve year old girl

d

Each ofthe following is a characteristic of an insurance contract, EXCEPT? a) Aleatory b) Adhesion c) Personal d) Trilateral

d

If a group plan is to be written on a non-contributory basis, what percentage of eligible employees must be covered? a) 25% b) 50% c) 75% d) 100%

d

In which of the following HMOs is a physician considered to be an employee? a) A close corporation b) A managed care plan c) An open panel plan d) A closed panel plan

d

John owns an individual disability income policy paying $800 per month with a 30 day waiting period. If he is disabled for 90 days what amount paid by his policy is taxable as income? a) $800 b) $1,600 c) $2,400 d) $0

d

Medigap policies must generally be written on which of the following bases? a) Non cancelable b) Guaranteed renewable c) Conditionally renewable d) Guaranteed renewable for life

d

Once an insured satisfies a stop-loss limit, an insurer generally pays what amount of any excess expenses? a) 75% b) 80% c) 90% d) 100%

d

Physician's expense coverage is also referred to as: a) Basic hospital expense b) Surgical expense c) Direct response expense d) Out-patient expense

d

Residual disability covers: a) Loss of income b) Loss of use c) Presumptive disability d) A percentage of lost income

d

Several elements must be present in order for an insurance contract to be enforceable. One required element is that all parties be competent. Each of the following is competent to contract, EXCEPT: a) Minor contracting for necessities b) An insured suffering a serious illness c) An officer of an insurer d) An individual under duress

d

Social Security is also known as: a) CPI b) OAS c) Part A d) OASDHI

d

The maximum amount of expenses that an insured is responsible for before a major medical plan pays 100% of remaining expenses is known as the: a) Coinsurance limit b) Limit of liability c) Percentage participation d) Stop loss limit

d

The purpose of Medicaid is to: a) Provide health care to those who have unlimited assets b) Provide health care to those who have a pre-existing disability c) Provide health care to those who have a need for coverage d) Provide health care to those who have insufficient income

d

Tom is covered by the same plan as Bill. He incurs covered expenses of$4,000. How much of this total bill will be paid by the insurer? a) $500 b) $1,000 c) $2,000 d) $3,000

d

Under which of the following organizations are the medical providers paid on a fee-for-service basis? a) A health maintenance organization b) A custodial care organization c) Blue Cross organization d) A preferred provider organization

d