Course 12

Who is financially liable for the payment of covered claims in a fully insured group health plan? -Insurer -Group member -Health provider -Guaranty Association

"insurer" The insurer bears the financial risk for payment of covered claims.

Coverage is limited for vision and dental insurance in all of the following ways, EXCEPT -Number of teeth cleanings per year -Dollar amount for eyeglass frames -Number of X-rays performed per year -Specific dollar amount for examinations

"Specific dollar amount for examinations". Vision and dental insurance usually limits coverage in all of these areas, EXCEPT "Specific dollar amount for examinations".

Under a disability income policy, which provision would be payable if the cause of an injury is unexpected and accidental? Presumptive disability provision Absolute accidental provision Accidental death benefit provision Accidental bodily injury provision

"Accidental bodily injury provision". Under the accidental bodily injury provision, benefits would be payable if the cause of an injury is unexpected and accidental.

The problem of overinsurance is addressed in which health insurance provision? -Entire contract -Suitability -Reinstatement -Coordination of benefits

"Coordination of benefits". The purpose of the coordination of benefits (COB) provision is to avoid duplication of benefit payments and over insurance when an individual is covered under more than one group health plan.

When a claimant has coverage under more than one health plan, which group medical plan provision applies? -Legal actions -Notice of claim -Time of payment of claims -Coordination of benefits

"Coordination of benefits". The purpose of the coordination of benefits provision is to avoid duplication of benefit payments and over-insurance when an individual is covered under more than one group health plan. The provision limits the total amount of claims paid from all insurers covering the patient to no more than the total allowable medical expenses.

Which of the following would be considered a possible applicant and contract policyholder for group health benefits? -Human resource department -Employer -Insured employee -Insurance company

"Employer". An employer would be a possible applicant and contract policyholder of a single master contract or master policy for group health benefits.

The policyholder for a group health benefit plan is considered to be the -Employee -Employer -Liaison -Insurer

"Employer". The employer is the policyholder for a group health benefit plan.

Which of the following is NOT typically covered under vision care insurance? -Eye surgery -Eyeglasses -Examinations -Contacts

"Eye surgery" Vision care insurance usually covers all of these except for eye surgery

Buy-sell plans are typically funded by which two types of insurance? -Life insurance and disability insurance -Annuities and disability insurance -Modified endowment contracts and Long-term care insurance -Life insurance and Long-term care insurance

"Life insurance and disability insurance" Buy-sell plans are normally funded by life insurance and disability insurance

What percentage of eligible employees must participate in a noncontributory group health plan before it can be put in effect? -0% -25% -50% -100%

"1 00%". Normally, 1 00% of eligible employees must participate in a noncontributory group plan before the plan can be put in force.

The Consolidated Omnibus Budget Reconciliation Act (COBRA) applies to employers who employ at least -10 employees -20 employees -30 employees -40 employees

"20 employees". Group health plans obligated by the Consolidated Omnibus Budget Reconciliation Act (COBRA) cover groups of at least 20 employees.

In regards to a group health insurance plan, which statement is CORRECT? -A contributory group health plan must cover at least 50% of all eligible members -A non-contributory group health plan must cover all eligible members -A minimum of 75% of eligible members is required for a non-contributory group health plan -A contributory group health plan only requires participation of key employees

"A non-contributory group health plan must cover all eligible members". A non-contributory group health insurance plan requires 100% participation of all eligible members.

During the underwriting process for a group health policy, it was discovered that 15 out of 50 members of the group have major health issues. How would the insurer handle this? -Accept or reject the whole group -Accept the 35 insurable individuals while rejecting the remaining 15 -Charge a higher premium to the 15 unhealthy individuals -Assign the group to a re-insurer

"Accept or reject the whole group" The approach in underwriting group health plans evaluates the group as a whole, rather than individuals within the group. Based on the group's risk profile, the group is either accepted or rejected.

Health insurance involves two perils, accident and_. -death -sickness -disability -liability

"sickness". The two perils in health insurance are accident and sickness.

Sonya applied for a health insurance policy on April1. Her agent submitted the information to the insurance company on April 6. She paid the premium on May 15 with the policy indicating the effective date being May 30. On which date would Sonya have coverage? -April 1 -April 6 -May 15 -May 30

"May 30". The "effective date" is the health insurance coverage start date.

justin is receiving disability income benefits from a group policy paid for by his employer. How are these benefits treated for tax purposes? Partially taxable income Non-taxable income Taxable income Conditionally taxable income

"Taxable income". Disability insurance benefits from a group policy paid for by an employer is considered taxable income.

Business Overhead Expense Insurance pays for -business expenses when a business owner becomes disabled -a business owner's salary in the event of the owner's disability -any loss in value of a business if the owner becomes disabled -business expenses during an economic downturn

"business expenses when a business owner becomes disabled" Business Overhead Expense Insurance is designed to pay business expenses incurred when a business owner is disabled.

In an employer-sponsored group accident and health plan, a master contract is issued to the -TPA -employees -Administrative Services Organization -employer

"employer". In an employer-sponsored group health plan, the employer is considered the policyowner and is issued the master contract.

Key Person Disability Insurance pays benefits to the -hospital -employee -employer -employee's creditors

"employer". Key Person Disability Insurance provides crucial benefits to protect the company financially in the event that a key employee can no longer work due to a disability. Key Person coverage provides cash flow to help companies move forward and maintain a profit in the event that a key employee becomes disabled. The employer is the policy-owner and pays premiums that are NOT tax-deductible. Benefits, however, are received tax-free to the employer.

An eligible individual who would like to obtain group health insurance without providing evidence of insurability must -enroll within a specified eligibility period -sign an affidavit that they are in good health -pay a higher premium than those providing evidence of insurability -agree to an individual policy instead of group coverage

"enroll within a specified eligibility period" In order to obtain group insurance without providing evidence of insurability, eligible individuals generally have to enroll within a specified eligibility period.

Credit Accident and Health plans are designed to -permit creditors the ability to require that coverage be purchased through insurers of their choice -provide permanent protection -help pay off existing loans during periods of disability -not permit free choice of coverage selection

"help pay off existing loans during periods of disability". Credit Accident and Health plans are designed to help pay off existing loans during periods of disability.

According to HIPAA, when an insured individual leaves an employer and immediately begins working for a new company that offers group health insurance, the individual -is eligible for coverage upon hire -must wait 360 days to be eligible for coverage -must continue coverage with the previous employer -is eligible for only health insurance, not life or dental insurance

"is eligible for coverage upon hire" According to HIPAA, when an insured individual leaves an employer and immediately begins working for a new company that offers group health insurance, the individual is eligible for coverage upon hire

Group health plans may deny participation based upon the member's claims history member's current age member's pre-existing condition member' part-time employment status

"member' part-time employment status" Group health plans may exclude participation based upon a member's part-time employment status. Full-time employees are typically eligible

Minimum participation standards exist for group health insurance plans in order to cover the agent's commission prevent adverse selection avoid treating benefits as taxable income meet state requirements

"prevent adverse selection". Group health plans require a minimum number of participants to prevent adverse selection.

Under the subrogation clause, legal action can be taken by the insurer against the responsible third party beneficiary policyowner State

"responsible third party". Under the subrogation clause, legal action can be taken by the insurer against the responsible third party.