Health Insurance Practice Exam Questions

A brain surgeon has an accident and develops tremors in her right arm. Which disability income policy definition of total disability will cover her for all losses?

"own occupation" - less restrictive

In all health care plans under the Affordable Car Act (ACA), how many essential benefit categories are there?

10

To be eligible unde HIPAA regulations, for how long should an individual converting to an individual health plan have been covered under the previous group plan?

18 months

What is the period of coverage for events such as death or divorce under COBRA?

36 months

If a consumer requests additional information concerning an investigative consumer report, how long does the insurer or reporting agency have to comply?

5 days

How long is an open enrollment period for Medicare supplement policies?

6 months

Accidental death and dismemberment benefits must be payable after an accident if the loss occurs within

90 days

Under the mandatory uniform provision Notice of Claim, the first notice of injury or sickness covered under an accident and health policy must contain

A statement that is sufficiently clear to identify the insured and the nature of the claim.

In health insurance, when would an excess plan pay benefits?

After the primary plan has paid its full promised benefit, the excess plan will pay the balance

How can a new physician be added to the PPO's approved list?

Agree to follow the PPO standards and charge the appropriate fees.

What is the term used for an applicant's written request to an insurer for the company to issue a contract, based on the information provided?

Application

What is the maximum period of time during which an insurer may contest fraudulent misstatements made in a health insurance application?

As long as the policy is in force.

What type of health insurance is sold to small business owners to reimburse them for the overhead expenses?

BOE - Business Overhead Expense insurance

Which of the following provides coverage of a first-dollar basis?

Basic expense

A child is covered under an HMO plan through her non-custodial parent. Which of the following is NOT true?

Claims cannot be submitted by the custodial parent without the non-custodial parent's permission

The act of rebating is considered a(n)

Class B misdemeanor

an applicant for an individual health policy failed to complete the application properly. Before being able to complete the application and pay the initial premium, she is confined to a hospital. This will not be covered by insane because she has not met the conditions specified in the...

Consideration clause

Regarding Medicare, which provision discloses the insurer's right to change premiums based on the insured's age?

Continuation Provision

Regarding Medicare, which provision discloses the insurer's right to change premiums based on the insured's age?

Continuation provision

5 basic characteristics of managed care plans

Controlled access to providers, comprehensive case management, preventive care, risk sharing, and high quality care

When a producer was reviewing a potential customer's coverage written by another company, the producer made several remarks that were maliciously critical of that other insurer. The producer could be found guilty of

Defamation

Applications for policies advertised by what method must include a statement announcing that the policy exclude pre-existing condition from coverage?

Direct response

Which of the following entities must approve the content of a group contract before it can be issued?

Director

A waiver of premium provision may be included with which kind of health insurance policy?

Disability income

which of the following services would NOT be included under a LHSO plan?

Emergency services

Other than condition stipulated by the Director, what is permissible reason for an HMO to cancel or not renew an enrollee's contract?

Failure to pay monthly premiums

Which of the following is an example of an unfair settlement practice?

Failure to promptly settle a claim when liability has been clearly established

Workers compensation benefits are regulated by which entity?

Federal

Contributory Plan

Group insurance plan under which the employees contribute to the payment of premiums.

No long-term policy may contain provisions that are less than

Guaranteed renewable

If a medical organization bears part of a patient's risk in healthcare-related costs, what type of organization is it?

HMO

Which of the following riders would NOT increase the premium for a policy owner?

Impairment rider

Under normal circumstances, if an insurer adds a rider to the policy, who must sign a statement of acceptance regarding the change?

Insured

Who makes up the Medical Information Bureau?

Insurers

What type of health insurance policy provides an employer with funds to train a replacement if a valued employee becomes disabled?

Key person disability

Rita bough an individual limited health care plan in Illinois in which some of the risk of her health costs was assumes by her health care provider. Which of the following plans does she have?

LHSO

4 types of workers compensation benefits

Medical Income Rehabilitation Death

Which of the following must be present in all Medicare supplement plans?

Medicare Part A

On its advertisement, a company claims that is has funds in its possession that are, in fact, not available for the payment of losses or claims. the company is guilty of

Misrepresentation

Under which individual disability policy, the MINIMUM schedule of time in which claim payments must be made to an insured is

Monthly

An HMO applicant is currently receiving medical assistance benefits. Which of the following alterations can the HMO make to the policy

NONE of the above

An insured under a long-term care policy and has just been diagnosed with Multiple Sclerosis (MS). What alteration will most likely be made to the policy?

No changes will be made

Compared with how it indemnifies losses resulting from accidents, a Medicare supplement policy generally indemnifies against losses resulting from sickness

No differently

Regarding the taxation of Business Overhead policies,

Premiums are deductible, and benefits are taxed

in respect to the consideration clause, which of the following is consideration on the part of the insurer?

Promising to pay in accordance with the contract terms.

which of the following special policies covers unusual risks that are NOT normally included under Accidental Death and Dismemberment coverage?

Special Risk Policy

The transfer of an insured's right to seek damages from a negligent party to the insurer is found in which of the following clauses?

Subrogation

Which of the following is generally NOT a limited health service included under an LHSO

Surgical services

Which of the following entities determines who can receive a Limited Lines Producer License?

The company that the person represents

How do employer contributions to a Health Savings Account affect the insured's taxes?

The employer contributions are not included in the individual insured's taxable income.

A policy with a 31-day grace period implies

The policy will not lapse for 31 days if the premium is not paid when due

How does a member of an HMO see a specialist?

The primary care physician refers the member

An insured notifies the insurance company that he has become disabled. What provision states that claims must be paid immediately upon written proof of loss?

Time of payment of claims

What is the purpose of managed car insurance plans?

To control health insurance claims expenses

Which of the following is true about the requirements regarding HIV exams?

applicant must give prior written consent

Long-term care coverage may be available as any of the following options EXCEPT

endorsement to a health policy

Hospital confinement indemnity coverage may not exclude emergency confinement in what type of facility?

federally operated hospital

No long-term policy may contain provisions that are less than

guaranteed renewable

Which type of a hospital policy pays a fixed amount each day that the insured is in a hospital?

indemnity

If a medicare benefit is increased, a signed statement is required from the policyholder

only if the premium increases in response

According to the Coordination of Benefits provision, if both parents have coverage for a child from their employer's policies, which policy will pay first?

parent whose birthday is earlier in the year

All of the following are covered by Part A of medicare EXCEPT

physician and surgeon's services

The primary purpose of disability income insurance is to

replace income lost due to a disability

An insured is applying for a policy in order to replace an existing policy; a replacement notice must be given to and signed by the applicant unless the existing coverage is

single premium nonrenewable

The legal process that gives the insurer, after payment of a loss, the right to seek recovery from a third party that was responsible for the loss is known as

subrogation

An employee insured under a group health policy is injured in a car wreck while performing her duties for her employer. This results in a long hospitalization period. Which of the following is true?

the group plan will not pay because the employee was injured at work

under a health insurance policy, benefits, other than death benefits, that have not otherwise been assigned, will be paid to

the insured

Workers compensation insurance covers a worker's medical expenses resulting from work related sickness of injuries and covers loss of income from

work-related disabilities

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?

$5,000

A producer failed to complete the required continuing education credit hours for this compliance period, and allowed his license to lapse. Within what time period after the deadline may the license be reinstated?

12 months

All Illinois long-care insurance policies must provide LTC coverage for at least how many consecutive months?

12 months

To be eligible under HIPAA regulations, for how long should an individual converting to an individual health plan have been covered under the previous group plan?

18 months

The time limit of certain defenses provision prohibits insurers from denying a claim due to misrepresentation, as long as the policy has been in force for at least

2 years

Before each license renewal, an insurance producer must complete at least how many hours of continuing education?

24

Prior to requesting renewal of an insurance producer's license, how many hours of continuing education must a producer complete?

24 hours

The relation of earnings to insurance provision allows the insurance company to limit the insured's benefits to his/her average income over the last

24 months

An insured receives a Medicare Supplement policy but decided not to keep it. How many days does the insured have to return the policy for a full refund of premium?

30 Days

Most policies will pay the accidental death benefits as long as the death is caused by the accident and occurs within

90 days

Under the uniform required provisions, proof of loss under a health insurance policy normally should be filed within

90 days of a loss

All of the following are correct about the required provisions of a health insurance policy EXCEPT

A reinstated policy provides immediate coverage for an illness.

If coverage is offered as a dividend, what also must be offered as an alternative option?

Alternative benefit

An agent makes a mistake on the application and then corrects his mistake by physically entering the necessary information. Who much then initial that change?

Applicant

An agent is ready to deliver a policy to an applicant but has not yet received payment. Upon delivery, the agent collects the applicant's premium check, answers any questions the applicant may have, and then leaves. What did he forget to do?

Ask her to sign a statement of good health.

A health insurance policy that pays a lump sum if the insured suffers a heart attack or stroke is known as

Critical illness

Which of the following statements is NOT true concerning Medicaid?

It consists of 3 parts: Part A: hospitalization, Part B: doctor's services, Part C: disability income.

Which of the following is NOT true regarding a Premium Fund Trust Account?

It could be used as a claim payment account

A Medicare supplement policyholder becomes eligible for Medicaid. She submits notice to her Medicare insurer after 18 days, and her policy is then suspended. Her Medicaid policy is terminated a year later. Which of the following best describes what will happen to her Medicare policy?

It will automatically resume on the Medicaid termination date

If an insurer terminates coverage on an insured, what will happen to the spouse's coverage?

It will remain unchanged

The coverage provided by a disability income policy that does not pay benefits for losses occurring as the result of the insured's employment is called

Nonoccupational coverage

A Medicare supplement policy's benefits are reduced in order to not duplicate coverage. Which of the following must occur in order for this change to be legal?

Nothing

A guaranteed renewable health insurance policy allows the

Policyholder to renew the policy to a stated age, with the company having the right to increase premiums on the entire class

Certain condition, such as dismemberment or total and permanent blindness, will automatically qualify the insured for full disability benefits. Which disability policy provision does this describe

Presumptive Disability

If a person is working toward becoming permanently licensed as a producer and is issued a temporary license, what else must the person also do?

Take a training course

Which of the following is NOT the consideration in a policy?

The application given to a prospective insured

An insured submitted a notice of claim to the insurer, but never received claims forms. He later submits proof of loss, and explains the nature and extent of loss in a hand-written letter to the insurer. Which of the following would be true?

The insured was in compliance with the policy requirements regarding claims.

When a business receives benefits from its key person disability insurance, how are those benefits taxed?

The key person disability insurance benefits are received tax free

Insurers usually do not reimburse claimants for 100% of income lost due to disability. What is the reason for insurer limitations on coverage amounts?

To provide an incentive for the insured to return to work

When an insured makes truthful statements on the application for insurance and pays the required premium, it is known as which of the following?

consideration

Which of the following is correct regarding selecting a primary care physician in a PPO plan?

insured must choose medical providers not found on the preferred list

In the event of loss, after a notice of claim is submitted to the insurer, who is responsible for providing claims forms and to which party?

insurer to the insured