Chapter 11: Unknowns
If an employer has less than ______ employees, Medicare will be the primary payer for those eligible for Medicare. A 20 B 75 C 50 D 100
A 20
A Medicare Supplement Policy must include, as a core benefit, Medicare Part B coinsurance in the amount of _______. A 20% B 10% C 25% D 15%
A 20%
Under Medicare Part D, individuals enrolled in a standalone plan from a participating approved Prescription Drug Provider (PDP) will pay: A A monthly premium, annual deductible and copays B Only an annual deductible and copays C Nothing out of pocket D An all-encompassing annual premium
A A monthly premium, annual deductible and copays
Which of the following types of coverage provides custodial care outside the home for individuals not requiring confinement? A Adult Day Care B Home Health Care C Respite Care D Hospice Care
A Adult Day Care
An insurer or producer soliciting long-term care policies must offer the insured the option of purchasing inflation protection that provides for the daily benefit amount and benefit maximums to increase based on reasonably expected increases in the cost of services provided in the policy at the time of: A Application B Policy anniversary C Policy delivery D First solicitation
A Application
Long-Term Care policies CANNOT be written as which of the following? A As short-term policies B As group policies C As individual policies D As riders or endorsements
A As short-term policies
California requires all tax-qualified long-term care plans to qualify based on: A Federal legislation B ERISA C State legislation D NAIC model act
A Federal legislation
Of the following listed choices, which is true as it pertains to Medicare Part A? A It is prepaid through FICA taxes and is automatic when that worker qualifies for Social Security retirement benefits ('fully insured') B Provides coverage for outpatient services C All recipients pay a monthly premium D It covers all prescription drugs
A It is prepaid through FICA taxes and is automatic when that worker qualifies for Social Security retirement benefits ('fully insured')
Medi-Cal pays for ________ health care including: physician visits, hospital and nursing home care, home health care, laboratory and x-ray services, prescriptions, medical equipment, ambulance services, eyeglasses, prenatal care, preventive care, and hospice. A Medically necessary B The customary expenses of C The reasonable costs and expenses of D The usual costs of
A Medically necessary
A sale of a new ____________ plan to a Medicare Advantage enrollee will result in automatic disenrollment from Medicare Advantage. A Medicare Supplement B Hospital indemnity C Medical expense D Long-term care
A Medicare Supplement
Which statement regarding Medicare is not true? A Medicare is the primary payor to any employer group health plan coverage B The initial enrollment period lasts 7 months and begins on the 1st day of the 3rd month before one is eligible for Medicare C Hospitals and other providers of health care that want to participate in the Medicare program must be licensed by the state D It is a federal health program for people 65 and older and others of any age who have received Social Security Disability Benefits for at least 2 years
A Medicare is the primary payor to any employer group health plan coverage
An insurer offering Medicare Supplements to senior clients must: A Offer Core Benefit Plan A if it sells any of the other plans B Select three standardized plans that it will offer C Offer at least one of the other standardized plans in addition to Core Benefit Plan A D Offer all of the standardized plans
A Offer Core Benefit Plan A if it sells any of the other plans
Medicare Advantage plans are offered by ___________ that contract with Medicare to provide both Part A and Part B benefits and typically prescription drugs. A Private insurance companies B Hospitals C Physician groups D State governments
A Private insurance companies
When an applicant does not accept the offer of inflation protection for a long-term care insurance policy the: A Producer must obtain a signed statement that the applicant has been made aware of and rejects the inflation protection benefit B Benefits are increased C Policy cannot be issued as applied for D Premiums are increased
A Producer must obtain a signed statement that the applicant has been made aware of and rejects the inflation protection benefit
Every insurer providing Long-Term Care Insurance in California must do all of the following, except: A Submit a list updated every 2 years of all agents or representatives authorized to solicit consumers for the sale of Long-Term Care insurance B Provide a copy of the long-term care insurance shoppers guide developed by the California Department of Aging to each prospective applicant prior to the presentation of an application or enrollment form for insurance C Display prominently on the first page of the policy and the outline of coverage: 'Notice to buyer: This policy may not cover all of the costs associated with long-term care incurred by the buyer during the period of coverage. The buyer is advised to review carefully all policy limitations.' D Establish marketing procedures to assure that any comparisons of policies will be fair and accurate and that excessive insurance is not sold or issued
A Submit a list updated every 2 years of all agents or representatives authorized to solicit consumers for the sale of Long-Term Care insurance
All producers who market and sell long-term care policies must be trained in the company's: A Suitability standards for solicitation and sales B Sales process C Underwriting procedures D Application submission process
A Suitability standards for solicitation and sales
All of the following statements are true regarding Long-Term Care policies, except: A They must require prior confinement in a hospital as a condition for payment B They may exclude coverage for illegal drug abuse C They must have a renewal provision shown on the first page of the policy D They must provide a free look period of at least 30 days
A They must require prior confinement in a hospital as a condition for payment
While a qualified long-term care policy must contain at least 5 of the 6 ADLs to be considered a qualified Long-Term Care plan receiving the tax benefits set forth by the IRS, California law requires: A - 6 B - 4 C - 3 D - 5
A - 6 A qualified long-term care policy must contain at least 5 of the 6 ADLs to be considered a qualified Long-Term Care plan receiving the tax benefits set forth by the IRS, however, California law requires all six ADL's.
Non-tax qualified plans must meet the eligibility requirements of the: A - California Insurance Code B - Federal Insurance Laws C - IRS D - NAIC
A - California Insurance Code
Medicare Plan A provides the ____ benefits that must also be included in all other Medigap plans. A - Core B -Comprehensive C - Indemnity D - Extended
A - Core
What is the requirement for inflation protection in an LTC policy? A - Inflation protection must be offered B - Inflation protection cannot be sold to persons over age 75 C - Inflation protection must be purchased D - Inflation protection is only available to persons over age 75
A - Inflation protection must be offered
Favorable tax treatment is given to Long-Term Care contracts that meet the following requirements for 'tax qualified' status, except: A - The contract pays for any Medicare reimbursable expenses B - The only protection in the contract is for Long-Term Care C - The policy must be a guaranteed renewable contract D - All refunds or dividends must be applied to either reduce premiums or increase benefits
A - The contract pays for any Medicare reimbursable expenses Favorable tax treatment is given to Long-Term Care contracts that does not pay any Medicare reimbursable expenses.
Which of the following pertaining to most LTC policies is true? A - They are issued guaranteed renewable B - They deny coverage for those with a destructive brain disease C - They can be cancelled on the grounds of age D - They provide coverage only for skilled nursing care
A - They are issued guaranteed renewable Every Long-Term Care Policy must contain a renewal provision that is no less favorable to the insured than guaranteed renewable. The other choices are prohibited provisions.
Which statement is incorrect concerning Part B of Medicare? A- Part B covers prescription drugs up to $1,500 annually B - Part B has an annual deductible and requires a copayment C - All Part B recipients pay a monthly premium D - Part B will cover vaccines and preventive screenings
A- Part B covers prescription drugs up to $1,500 annually
In order to be in a Medicare __________ plan, enrollment in both Medicare Parts A and B is required and premium payments for Part B must be continued. A Medi-Cal B Advantage C Life D Health
B Advantage
Under Medicare Part B, a(n) __________ outlines the covered services and approved amounts sent to the beneficiary. A Explanation of Medical Benefits B Assignment notice C Medicare Summary Notice (MSN) D Billing statement
B Assignment notice
All insurers, brokers, agents and others engaged in the business of insurance owe a consumer all of the following duties, except: A Good faith B Best prices C Fair dealing D Honesty
B Best prices
The Minimum Benefit Standards under a qualified LTC policy include all of the following, except: A An Outline of Coverage must be delivered to an applicant on the initial solicitation and prior to the presentation of the application form B Every LTC policy must be issued as noncancellable C Every LTC policy must include basic policy requirements in the policy provisions D Every LTC policy must offer optional inflation protection to offset the increased costs of care
B Every LTC policy must be issued as noncancellable
The _________ Enrollment Period provides an open enrollment period from January 1 to March 31 each year for those who did not enroll in Medicare Part B when they first became eligible. A Special B General C Medicare Open D Initial
B General
Which of the following is true of Medicare Part A, in terms of coverage? A Helps pay for outpatient services B Helps pay for hospital care and skilled nursing facility care as an inpatient plus home or hospice care C Helps pay for routine physical exams D Helps pay for surgeon services
B Helps pay for hospital care and skilled nursing facility care as an inpatient plus home or hospice care
Medicare Part B covers all of the following, except: A Home health care B Long-term care (private or custodial nursing care) in any setting C Mental health care D Preventive care
B Long-term care (private or custodial nursing care) in any setting
Issuers of Medigap policies must do all of the following, except: A Establish marketing procedures that ensure that policy comparisons will be fair and accurate B Make every reasonable effort to determine if a Medigap policy applicant already has life insurance and the types and amounts of that insurance C Establish marketing procedures that prevent excessive insurance from being sold or issued D Display prominently on the policy's first page, the statement: 'Notice to buyer: This policy may not cover all of your medical expenses'
B Make every reasonable effort to determine if a Medigap policy applicant already has life insurance and the types and amounts of that insurance
Under Medicare Part B, ____________ refers to a nonparticipating provider that does not accept Medicare's assigned amount for services provided. A Assignment B Non-assignment C Arbitration D Appeal
B Non-assignment Under Medicare Part B, non-assignment refers to a nonparticipating provider that does not accept Medicare's assigned amount for services provided.
This rider will provide paid-up coverage if the insured cancels or lapses the policy due to nonpayment of premium. A Waiver of premium B Nonforfeiture C Guaranteed insurability (Future increase option) D Return of premium
B Nonforfeiture
The Initial Enrollment Period for Medicare is 7 months in length. Which of the following are the start and stop dates for this period? A The 1st day of the month before the individual turns age 65 and the last day of the 5th month after the month the individual turns age 65 B The 1st day of the 3rd month before the individual turns age 65 and the last day of the 3rd month after the month the individual turns age 65 C January 1 to July 31 in the year of his/her 65th birthday D 7 months after his/her 65th birthday
B The 1st day of the 3rd month before the individual turns age 65 and the last day of the 3rd month after the month the individual turns age 65
Failure to enroll in Medicare Part B, when required, may result in a lifetime cumulative premium penalty of _____% for each 12 month period a beneficiary was not enrolled in Part B. A - 5 B - 10 C - 15 D - 20
B - 10 Failure to enroll in Medicare Part B, when required, may result in a lifetime cumulative premium penalty of 10% for each 12 month period a beneficiary was not enrolled in Part B.
Every Long-Term Care policy must provide a ______-day free look period from the date the policy is delivered. A - 10 B - 30 C - 15 D - 60
B - 30
Medicare Supplement Plan ______ is the basic Medicare Supplement plan offering core benefits and must be offered by all insurers marketing Medicare Supplements. A - D B - A C - B D - C
B - A
Which of the following is not true of Medicare Part B? A - Provides coverage for outpatient services B - All retirees are automatically covered C - All recipients pay a monthly premium D - It is optional coverage for those eligible for Part A
B - All retirees are automatically covered Part B - Medical Insurance (Outpatient) is a voluntary program of government-subsidized insurance requiring participants to make premium payments.
Long-Term Care policies CANNOT be written as which of the following? A - As group policies B - As short-term policies C - As riders or endorsements D - As individual policies
B - As short-term policies
A person who purchases a Medicare Supplement policy cannot enroll in Medicare Part _________. A - A B - C C - B D - D
B - C
All Medicare Supplement application forms must include questions to determine if at the date of application the applicant currently has all of the following policies or certificates in force, except: A - Medicare Advantage B - Life insurance or annuities C - Medicare supplement D - Medi-Cal coverage
B - Life insurance or annuities
With Medicare Advantage plans, the use of network providers, referrals to specialists, and pre-authorization of scheduled procedures are methods used to: A - Reduce utilization B - Manage care C - Reduce costs D - Manage expenses
B - Manage care With Medicare Advantage plans the use of network providers, referrals to specialists, and pre-authorization of scheduled procedures are methods used to manage care.
A Medicare beneficiary enrolled in a Medicare Advantage plan may have any of these other insurance plans, EXCEPT: A - Life insurance with cash value in excess of $1,500 B - Medicare supplement C - Long-term care D - Disability income
B - Medicare supplement
A comprehensive Long-Term Care policy will provide benefits in each of the following settings, EXCEPT: A - Hospice care in a family member's home B - Therapeutic care in a an acute care hospital C - The home of the insured D - Intermediate care nursing facility
B - Therapeutic care in a an acute care hospital Long-term care does not pay the expenses connected with an acute care hospitalization.
The 'time limit on certain defenses' generally terminates the insurance company's right to void a claim more than _________ years from the date of policy issue. A. 10 B. 2 C. 1 D. 5
B. 2 The time limit on certain defenses provision limits the time period the insurance company has to contest a claim to less than 2 years.
A Medicare Supplement or LTC policy's free look period is: A 60 days B 45 days C 30 days D 15 days
C 30 days
A qualified Long-Term Care Policy may exclude losses incurred from preexisting conditions for no longer than ______ months from the effective date of coverage. A 8 B 12 C 6 D 3
C 6
If a group Medicare Supplement policy is terminated by the group policyholder, the insurer must offer a certificate holder: A An individual policy with enhanced benefits at a lower premium B A full refund of any premiums paid less any benefits paid out C An individual policy providing the same benefits as the group policy or an individual policy that provides only benefits required to meet the minimum standards D A full refund of any premiums paid
C An individual policy providing the same benefits as the group policy or an individual policy that provides only benefits required to meet the minimum standards
Under a California LTC Partnership policy asset disregard means whatever benefit amount a partnership policy paid will be disregarded from a person's assets if _________ is applied for in the future. A Medicare B Social Security Disability C Medicaid D Unemployment
C Medicaid
Which of the following is true concerning the Benefit Period of a LTC Policy? A It is the time between the beginning of a policyholder's disability and the beginning of the policy's benefits B It is always for the life of the insured C Once the elimination period has been satisfied, it is how long benefits will be payable D None of the answers listed
C Once the elimination period has been satisfied, it is how long benefits will be payable
The following acts and practices are prohibited, except: A Intentionally making any false or materially inaccurate representation or comparison of two or more policies which induces any person to lapse, forfeit, surrender, or not take, a policy of insurance B Using any marketing method that induces or even tends to induce the purchase of insurance through force, fright, threat or undue pressure C Providing a prospective applicant, at the time of solicitation, written notice that the Health Insurance Counseling and Advocacy Program (HICAP) provides health insurance counseling to senior California residents free of charge D Using any method of marketing that fails to conspicuously disclose that a purpose of the advertising is the solicitation of insurance and that contact will be made by an insurance agent or insurance company
C Providing a prospective applicant, at the time of solicitation, written notice that the Health Insurance Counseling and Advocacy Program (HICAP) provides health insurance counseling to senior California residents free of charge
The type of care that is provided in a licensed facility that provides continuous 24-hour nursing services, by or under the supervision of an R.N., is considered: A Intermediate B Custodial C Skilled nursing D Critical
C Skilled nursing
The Initial Enrollment Period for Medicare is 7 months in length. Which of the following are the start and stop dates for this period? A January 1 to July 31 in the year of his/her 65th birthday B 7 months after his/her 65th birthday C The 1st day of the 3rd month before the individual turns age 65 and the last day of the 3rd month after the month the individual turns age 65 D The 1st day of the month before the individual turns age 65 and the last day of the 5th month after the month the individual turns age 65
C The 1st day of the 3rd month before the individual turns age 65 and the last day of the 3rd month after the month the individual turns age 65
Medicare Part A covers all of the following, except: A Semiprivate room and board B Prescription drugs including anesthesia C The first 3 pints of blood per calendar year D Operating room costs
C The first 3 pints of blood per calendar year
An insured is hospitalized for at least 3 days. How long will Medicare pay for confinement in a skilled nursing facility? A Up to 90 days B Up to 30 days C Up to 100 days D Up to 365 days
C Up to 100 days
Medi-Cal expenditures on behalf of persons in institutional settings and all expenditures on behalf of persons age _____ and older are subject to 'asset recovery' under federal Medicaid rules following the death of the individual. A - 40 B - 50 C - 55 D - 45
C - 55
There are ______ Activities of Daily Living (ADLs). A - 3 B - 4 C - 6 D - 5
C - 6
Medicare Advantage is Medicare Part: A - A B - B C - C DD
C - C
As long as the premium is paid, a Medigap policy is __________ renewable. A - Conditionally B - Optionally C - Guaranteed D - Partially
C - Guaranteed
A 67-year-old individual works for a large company and plans on working until at least age 70. The individual signed up for Medicare at age 65 and the employer has a group health insurance plan. If a loss occurs, how will the claim be handled? A - Medicare will be the primary payor while her group health plan will be the secondary payor B - Medicare will cover it all C - Her group health plan will be the primary payor while Medicare will be the secondary payor D - The employer group health plan will cover it all
C - Her group health plan will be the primary payor while Medicare will be the secondary payor
How does Medicaid differ from Medicare? A - Medicaid is only for persons over age 21 and under age 65 B - Medicaid is optional coverage for Medicare beneficiaries C - Medicaid is a federal-state partnership providing health care benefits for low income persons D - Medicaid is health insurance for persons who do not have access to group health insurance
C - Medicaid is a federal-state partnership providing health care benefits for low income persons Medicaid is a federal-state partnership that provides health care to persons whose incomes are under 138% (percentage dependent on Medicaid expansion) of the Federal Poverty Level.
Under Medicare Part B, the amount a doctor or supplier that accepts assignment can charge a patient is the: A - Medicare Summary Notice (MSN) B - Maximum assignment C - Medicare-approved amount D- Explanation of Medical Benefits
C - Medicare-approved amount
The Medicare Supplement insurer must notify the insured of all of the following changes in Medicare, except: A - Copays B - Deductibles C - Part B premiums D - Any adjustments to the Medicare Supplement policy
C - Part B premiums The Medicare Supplement insurer must notify the insured of the changes in Medicare deductibles and copays as well as any adjustments to the Medicare Supplement policy.
When replacing a Medicare Supplement policy, the agent must be sure that the replacement does not result in: A Increased benefits at a decrease in premium B Increased benefits at an increase in premium C Decreased benefits at a decrease in premium D Decreased benefits at an increase in premium
D Decreased benefits at an increase in premium
In order to obtain Medicare Part A premium free the enrollee must be: A Totally and permanently disabled B Uninsurable and qualify for Medi-Cal C Currently insured under Social Security D Fully insured under Social Security
D Fully insured under Social Security Medicare Part A enrollment is automatic and 'premium-free' for those who are fully insured (earned 40 credits) under Social Security.
As long as the premium is paid, a Medigap policy is __________ renewable. A Partially B Optionally C Conditionally D Guaranteed
D Guaranteed
When replacing a Medicare Supplement policy, a copy of the notice of replacement, signed by the applicant and the agent, must be provided to the applicant and a signed copy must also be retained by the: A Agent B Agency C Commissioner of Insurance D Insurer
D Insurer
With _______, the patient must pay 20% of covered charges plus the deductible. A None of the answers listed B Medicaid C A Medicare Supplement D Medicare Part B
D Medicare Part B
Which type of LTC coverage is designed to provide relief for the primary caregiver of a long-term care patient? A Home Health Care B Hospice Care C Adult Day Care D Respite Care
D Respite Care
Randy has a preexisting condition for which coverage has been excluded since his Medicare Supplement Policy became effective 4 months ago. If Randy were to replace his Medicare Supplement Policy, what could be said about the preexisting condition under the new policy? A The exclusion remaining on the old policy will be added to the one on the new policy B The exclusion will be waived altogether C The 6-month exclusion period starts over D The exclusion will be waived to the extent it has already been satisfied under the original policy
D The exclusion will be waived to the extent it has already been satisfied under the original policy
The Commissioner will prepare a rate guide for Medicare supplement insurance contracts available on or before the date of the fall Medicare annual open enrollment every: A 2 years B 18 months C 6 months D Year
D Year
If the insured is incapable of performing or requires 'stand-by assistance' with any _____ or more ADLs, the benefits will be triggered. A - 5 B - 4 C - 3 D - 2
D - 2
Originally, Medicare was for U.S. citizens age _______ and over. A - 62 B - 60 C - 55 D - 65
D - 65
What is the purpose of a respite care benefit in a Long-Term Care policy? A - Covers care in an adult day care facility B - Covers the cost of insurance when a person is disabled C - Provides care for a person who is terminally ill D - Gives a primary care giver a break
D - Gives a primary care giver a break Respite care benefits provide the individual primarily responsible for the care of a disabled person in a home care setting with a break from their duties. It will pay for a substitute caregiver or for the disabled person to be placed in an institutional setting for a short period of time.
The goal of the Long-term care Partnership program is to encourage the purchase of long-term care policies that subsequently will ease the financial burden on: A - Nursing homes B - Medicare C - Hospitals D - Medicaid
D - Medicaid The goal of the Long-term care Partnership program is to encourage the purchase of long-term care policies that subsequently will ease the financial burden on Medicaid.
Which of the following statements is not true: A - Lifetime reserve days under Medicare Part A are not renewable B - Medicare Part A is premium-free for most persons covered by Social Security C - Medicare Part A does not pay for the first three units of blood needed in a year D - Medicare Part A pays for outpatient hospital expenses such as Emergency Room
D - Medicare Part A pays for outpatient hospital expenses such as Emergency Room
What advantage do persons have when applying for a Medicare Supplement insurance plan at the same time they are first eligible for Medicare? A - They will be accepted at preferred rates even if declared substandard by underwriting B - They will be issued noncancellable policies C - They will be subject to preexisting condition waiting periods, higher premiums and exclusions D - They cannot be declined for the insurance
D - They cannot be declined for the insurance
Which of the following is not a core benefit in a Medicare Supplement policy? A - The first 3 pints of blood administered in a calendar year B - Up to 365 days of hospital charges after Medicare benefits run out C - Coinsurance amounts payable under Part B D - Up to 365 days of long-term care expenses after three days of hospitalization
D - Up to 365 days of long-term care expenses after three days of hospitalization Basic (or Core) Benefits in Medicare Supplement insurance do not include coverage for LTC expenses