Personal finance - Chapter 11

13) Which of the following statements is not correct about Medicaid? A) The Social Security Act created Medicaid in 1965. B) Medicaid is a program of medical assistance to certain low-income individuals and families. C) Medicaid is administered by each state within certain federal guidelines. D) Medicaid is financed by both state and federal funds. E) Medicaid is provided to wealthy individuals

E

61) Which country has the highest per capita medical expenditures of any industrialized country in the world? A) Australia B) Britain C) Canada D) Denmark E) United States

E

62) Which of the following groups has undertaken innovative activities to contain the costs of health care? A) Employers B) Labor unions C) Health insurers D) Consumers E) All of these

E

63) Which of the following is an innovative way concerned groups are containing health care costs? A) Incentives to encourage preventive care B) Encouragement of prepaid group practices C) Establishment of community health education programs D) Encouragement by doctors for patients to pay cash for routine medical care E) All of these

E

64) What are some possible reasons for high and rising costs of health care? A) The use of sophisticated and expensive technologies B) Rapid average earnings growth for health care professionals C) Duplication of tests D) The increasing number and longevity of elderly people E) All of these

E

66) Most group health insurance plans in the United States are sponsored by: A) victims of communicable diseases. B) individuals with families. C) single individuals with no dependents. D) elderly individuals. E) employers

E

80) Which provision in a health insurance policy states that you will pay a flat dollar amount each time you receive a covered medical service? A) Daily benefit B) Benefit period C) Policy limit D) Elimination period E) Copayment

E

86) Which type of insurance is usually bought in combination with hospital expense and surgical expense insurance? A) Disability income B) Comprehensive major medical C) Umbrella D) Hospital indemnity E) Physician's expense

E

92) Dental expense insurance provides reimbursement for: A) oral examinations. B) fillings. C) extractions. D) inlays. E) All of these

E

98) Health insurance is not available from: A) private insurance companies. B) Blue Cross and Blue Shield. C) HMOs. D) PPOs. E) home health care agencies

E

1) The United States has the lowest per capita medical expenditures of any industrialized country in the world

False

14) Physician expense insurance coverage excludes visits to the doctor's office, x-rays, and lab tests.

False

20) A recent study by Americans for Long-Term Care Security found that one out of five Americans over age 30 is at risk of needing some form of long-term care within the next 12 months.

False

23) A hospital indemnity policy pays benefits directly to the hospital only when you are hospitalized.

False

24) The hospital indemnity policy is a good substitute for basic or major medical protection.

False

25) Dread disease and cancer policies are usually very good values.

False

27) Blue Cross plans provide for surgical and medical services performed by physicians.

False

28) Blue Shield plans provide hospital care benefits on essentially a "service type" basis.

False

31) Medigap insurance, intended to supplement Medicare, is sold and serviced by the federal government

False

38) Care in a skilled nursing facility beyond 100 days per benefit period is approved and covered by Medicare

False

39) Medicare covers routine checkups, dental care, most immunizations, cosmetic surgery, routine foot care, eyeglasses, and hearing aids.

False

40) Medicare covers the cost of care received outside the United States, Canada, and Mexico.

False

42) Medicare supplement insurance is a government-sponsored program.

False

45) Very few members of the Medicaid population are also covered by Medicare.

False

47) Because Medicaid coverage is very limited, people using it need to purchase supplemental insurance

False

50) Disability income insurance is probably the least neglected form of available insurance protection

False

51) Every year, 12% of the adult U.S. population suffers a long-term disability.

False

53) Disability benefits begin on the first day you become disabled.

False

54) Generally, disability income policies with shorter waiting periods have lower premiums.

False

59) Most salaried workers in the United States do not participate in the Social Security program.

False

6) Health club membership is a form of protection to alleviate the financial burdens individuals suffer from illness or injury

False

7) Group health insurance will cover you, but not your immediate family.

False

9) Very few group health insurance policies have a coordination of benefits provision.

False

43) Title XIX of the Social Security Act provides for a program of medical assistance to certain low-income individuals and families, known as Medicaid

True

44) Medicaid is financed by both state and federal funds.

True

46) Medicaid differs from Medicare because eligibility for Medicaid depends on having very low income and assets.

True

48) Disability income insurance provides regular cash income lost by employees as the result of an accident or illness

True

49) Once a person is eligible, Medicaid provides more benefits than does Medicare.

True

5) The prescription to stay healthy includes getting sufficient rest, relaxation, and exercise.

True

52) Good disability plans pay when you are unable to work at your regular job; poor disability plans pay only when you are unable to work at any job

True

55) You should seek a disability income policy that pays benefits for life.

True

56) You should look for a disability income policy that waives premium payments while you are disabled

True

57) The premium for noncancelable and guaranteed renewable coverage for a disability income policy is higher, but the coverages are well worth the extra cost.

True

58) Many employers provide disability income protection for their employees through group insurance planes

True

60) It is best for you to get routine care and recommended preventive services from a primary care provider rather than a hospital's emergency department.

True

8) Individual health insurance covers either one person or a family.

True

108) Hospital insurance is which part of Medicare? A) Part A B) Part B C) Part C D) Part D E) Part E

A

114) Because you feel young and healthy now, you may overlook the very real need for which type of insurance? A) Disability income B) Automobile C) Dental D) Vision care E) Liability

A

116) Good disability plans pay when you are: A) unable to work at your regular job. B) unable to work at any job. C) unable to work at a related job. D) ill even for a short period. E) fired from your regular job.

A

65) What is one of the best ways for you to avoid the high cost of illness? A) Get sufficient rest. B) Gain a little extra weight. C) Smoke and drink. D) Drive dangerously. E) Avoid relaxation.

A

67) Which type of health insurance plan may not provide benefits for the major portion of your medical care bills? A) Group health insurance B) Life insurance C) Medicare D) Medicaid E) Disability income insurance

A

90) ________ is a type of major medical insurance that has a very low deductible amount and is offered without a separate basic plan. A) Comprehensive major medical insurance B) Major Medical expense insurance C) Physician's expense insurance D) Hospital expense insurance E) Surgical expense insurance

A

91) Which health insurance policy pays benefits only when you are hospitalized, but pays these benefits in cash which you can use for medical, nonmedical, or supplementary expenses? A) Hospital indemnity B) Interim or short-term C) Disability income D) Comprehensive major medical E) Major medical expense

A

115) Disability: A) is universally unacceptable. B) has several definitions. C) is determined by the American Council of Life Insurance. D) has been formalized by the National Disability Council. E) is provided by the Insurance Information Institute.

B

7) Which type of health insurance includes two features (a deductible provision and a coinsurance provision) to help keep the premium within the policyholder's means? A) Disability income B) Major medical expense C) Hospital indemnity D) Physician's expense E) Surgical expense

B

100) Most private insurance companies sell health insurance policies to ________, who in turn offer them as fringe benefits. A) individuals B) families C) employers D) employees E) non-profit organizations

C

102) Hospital insurance (Part A) and medical insurance (Part B) are characteristics of: A) Blue Cross. B) Blue Shield. C) Medicare. D) Medicaid. E) HMO.

C

104) Medigap is sold or serviced by: A) Medicare. B) Medicaid. C) private insurance companies. D) the federal government. E) State governments.

C

106) Which one of the following is a source of government health insurance? A) Blue Cross B) Blue Shield C) Medicare D) HMO E) PPO

C

112) Medicare medical insurance is: A) mandatory. B) financed by corporations. C) voluntary, and you must sign up for coverage. D) state supported and partially funded by the National Institutes of Health. E) paid for by state governments

C

88) A good health insurance plan should: A) pay at least 90 percent for out-of-hospital expenses after a yearly deductible. B) provide at least 100 days' hospital room and board in full. C) provide at least a $1 million lifetime maximum for each family member. D) impose unreasonable exclusions. E) limit out-of-pocket expenses to no more than $10,000 a year.

C

89) Which one of the following provisions requires that the policyholder pay a basic amount before the policy benefits begin? A) Coinsurance B) Stop loss C) Deductible D) Self-insurance E) Incontestable

C

93) According to your textbook, the average benefit paid under a hospital indemnity policy: A) is almost always excellent buys. B) should be purchased at an early age. C) does not justify the premium cost. D) should be purchased only by older people. E) is meant for couples with two or three children.

C

94) Which type of health insurance is notoriously a poor value? A) Individual health B) Group health C) Dread disease D) Dental E) Vision

C

97) Which type of insurance protects your ability to earn income? A) Life B) Liability C) Disability income D) Car E) Home and property

C

41) Medicare was never intended to pay all medical costs.

True

111) Medicare medical insurance helps pay for: A) inpatient hospital care. B) doctors' services. C) home health care. D) hospice care. E) inpatient care in a skilled nursing facility

B

33) Medicare does not cover the medical expenses of private-duty nursing care

True

34) The two best-known sources of government health insurance are Medicare and Medicaid.

True

35) Medicare originally had two parts: hospital insurance and medical insurance.

True

109) Medical insurance is which part of Medicare? A) Part A B) Part B C) Part C D) Part D E) Part E

B

95) Which of the following statements is not true? A) Physician expense insurance coverage normally excludes visits to the doctor's office, x- rays, and lab tests. B) Basic health insurance coverage includes hospital expense insurance, surgical expense insurance, and physician expense insurance. C) A deductible provision requires the policyholder to pay a basic amount before the policy benefits begin. D) A good health insurance plan should impose no unreasonable exclusions. E) A hospital indemnity policy is not a substitute for basic or major medical protection.

A

96) Which one of the following would be your best selection if you could only choose one of the following types of insurance? A) A basic plan combined with a major medical expense plan B) Combined dental and vision plan C) Dread disease and cancer plan D) Long-term care E) Accident

A

36) Medicare hospital insurance is financed from a portion of the Social Security tax.

True

105) Which one of the following is a correct statement about the administrative costs of the health care system in the U.S.? A) Consumes 1% of healthcare dollars B) Considered ethical to spend a high percentage on administrative costs C) Americans pay less for health care than those living in Canada's socialized system D) Includes enrolling beneficiaries and checking eligibility E) Includes rebates to customers for good health checkups

D

85) A good health insurance plan should: A) impose unreasonable exclusions. B) provide at least a $2 million lifetime maximum for each family member. C) pay 100 percent for out-of-hospital expenses. D) provide at least 120 days' hospital room and board in full. E) limit your out-of-pocket expenses to no more than $1,000 per year.

D

99) Which one of the following is not a provider of health insurance? A) Fraternal organizations B) Trade unions C) Government programs such as Medicare D) Health Insurance Industry Association E) Blue Cross and Blue Shield

D

37) To get Medicare medical insurance, you must sign up for it and pay a monthly premium.

True

4) One way to reduce your own medical costs is to stay well.

True

101) Which health insurance plan directly employs or contracts with selected physicians to provide managed health care services in exchange for a fixed, prepaid monthly premium? A) Blue Cross B) Blue Shield C) Medicare D) Medicaid E) HMO

E

103) Which medical expense is covered by Medicare? A) Acupuncture B) Immunizations C) Private-duty nursing D) Routine checkups E) Hospice care

E

107) Which one of the following is a source of government health insurance that is administered by each state? A) Blue Cross B) Blue Shield C) National Institutes of Health D) HMO E) Medicaid

E

110) The hospital insurance portion of Medicare helps pay for: A) inpatient hospital care. B) inpatient care in a skilled nursing facility. C) home health care. D) hospice care. E) All of these

E

10) A good health insurance plan should offer basic coverage for hospital and doctor bills.

True

11) A good health insurance plan should impose no unreasonable exclusions.

True

12) More people have hospital insurance than any other kind of health insurance.

True

13) People often buy surgical expense insurance in combination with hospital expense insurance and physician expense insurance.

True

15) Basic health insurance coverage includes hospital expense insurance, surgical expense insurance, and physician expense insurance.

True

16) A deductible provision requires the policyholder to pay a basic amount before the policy benefits begin.

True

17) Hospital expense insurance pays part or the full amount of hospital bills for room, board, and other charges.

True

18) Surgical expense insurance pays part or the full amount of the surgeon's fees for an operation

True

19) Physician expense insurance helps pay for physician's care that does not involve surgery.

True

2) Affordable health care has become one of the most important social issues of our time

True

2) Medicaid is administered by each state within certain broad federal requirements and guidelines

True

21) A coinsurance provision requires the policyholder to share the expenses beyond the deductible amount

True

22) A stop-loss provision requires the policyholder to pay up to a certain amount, after which the insurance company pays 100 percent of all remaining covered expenses

True

26) Long-term care insurance was virtually unknown 50 years ago, but it is now growing faster than any other form of insurance

True

29) Preferred provider organizations combine the best elements of the fee-for-service and HMO systems.

True

3) One reason for the high and rising costs of health care is the use of sophisticated and expensive technologies

True

30) Part A of Medicare pays for all covered services for inpatient hospital care after you pay a single annual deductible.

True