AD&D and Medical Expense Flashcards
What types of policies can AD&D be written on
- Individual health
- Group health
- Rider
Under a life insurance policy, what happens to your benefit if you die due to an accident
Your benefit could double
What type of policy is AD&D
It is a valued policy
Define valued policy
Policy that will pay a specified amount of money (instead of paying the insured the actual amount of the loss)
What is the policies face amount called
Principal sum
Define principal sum
Amount paid if there is an accident that causes the insured to die within a specified period of time after the accident
Define capital sum for single dismemberment
If you lose sight in one eye, then you will receive one half of the principal sum
What if I have multiple dismemberment (loss of two limbs loss of sight in both eyes)
Then you will receive the entire principal sum
Define dismemberment
Total loss of sight or severance of a limb at or above a major joint connecting it to the body (if you lose an arm from the wrist up or if you loose a leg from the ankle up) (hand and foot don’t count)
What if dismemberment was caused by a disease or illness, would it still be covered
No, death or dismemberment is only covered if it is accidental
Define accidental bodily injury
When an injury results from an accident as an unintended occurrence
Is it still an accident if the insured engages in hazardous acts or doesn’t take reasonable precautions
No, it is not an accident
Define the primary beneficiary
The first in line to receive death benefits when the insured dies
Define contingent beneficiary
Next in line to receive death benefits if the primary beneficiary dies before the insured
What if a beneficiary is irrevocable
This means that the policy owner cannot change the beneficiary without the beneficiary’s consent
What are 3 classifications of health insurance
- Individual/group
- Private or government
- Limited or comprehensive
Under what type of policy could a physical exam be required
Under an individual policy, not a group policy
What are three examples of private insurance entities
- Commercial health insurance companies
- Health care service contractors/HMOs
- PPOs
Define CHAMPUS
The government provides medical expense benefits to the dependents of military personnel
Define comprehensive policies
They cover most exposures (cover income lost and pay medical expenses)
Define fee-for-service
The insured pays premiums for insurance and the insurer pays providers for services performed
Define plans operating on a prepaid basis (HMOs)
Charge the subscriber for services in advance and then cover the services if they are performed
Define benefit schedule
There is a schedule that lists the amounts to be paid for each treatment either as a dollar amount or as a unit value
Define usual, customary and reasonable charges
It does not specify an amount, it provides benefits up to the reasonable and customary charge for service in that area
In HMOs do you have to see their providers
Yes, you have to see providers in the HMOs (Keiser)
What do commercial insurance policies cover
Insureds
What do HMOs, PPOs and health care service contractors refer to their participants as
Subscribers
What are two ways that basic expense policies reimburse for services
- Reimburse the insured for expenses (reimbursement policy)
- Pay the health care provider directly (if coverage is on a service basis)
What are three things that basic expense policies cover
- Hospital expense
- Medical expense
- Surgical expense
What are 3 characteristics of basic expense policies
- Low limits of coverage
- No coinsurance
- Little to no deductible
What is said to provide first dollar coverage
Basic expense policies, because they pay for medical expenses from the first day of hospitalization
What are 6 things that are not covered under basic medical expense policies
- Regular exams
- Custodial care
- Intentional injuries
- Prescription drugs
- Dental
- Treatment for drug and alcohol abuse
What does the daily hospital expense benefit cover
Room and board
Define when coverage is applied on a reimbursement (expense-incurred) basis
Covers actual expenses up to a fixed max or percentage of the actual or UCR cost
Define ancillary (or miscellaneous) hospital expense benefits
They cover the costs of other basic hospital services besides room and board (dressings, drugs, therapy, lab work)
Define an absolute value schedule
Shows the maximum dollar amount for each procedure
Define a relative value schedule
Assigns a relative unit value to each procedure based on its cost relative to the other procedures
How do you determine the actual dollar benefit amount in relative value
You multiply the number of value units by a conversion factor
How is the conversion factor determine
It is based on a geographic area and premiums paid
What do medical expense benefits not cover
They exclude coverage for routine exams and services that would be covered under hospital and surgical expense benefits
What do medical expense benefits generally limit
The number of visits and the dollar amount per visit
Besides physician charges, what other 5 things does medical expense benefits cover
- Private nursing duty
- Drugs
- Vision
- Home Health
- Maternity
For private nursing duty covered under medical expense benefit, what are limitations
Can be in the hospital or out of the hospital at a reduced level
For drugs covered under medical expense benefit, what are limitations
- Usually a limit on the amount of drugs or the length of period per prescription
- Deductible
For vision covered under medical expense benefit, what is covered
Cost of the eye exam and lenses per year
For vision covered under medical expense benefit, what are limitations
Excludes sunglasses, safety glasses, loss of lenses due to breakage and medical or surgical treatment
For home health covered under medical expense benefit, what is covered
Covers the cost of part-time home health care following hospitalization
What does the benefit of home health care include under medical expense
- Home health aide
- Therapy
- Medical supplies and equipment
- Nursing
- Social services
What are limitations of home health under medical expense
- Coverage limits are often related to a percent of UCR charges
- Max number of visits
- Length of time
Does home health care under medical expense apply to custodial care
No
How is maternity benefits payable under the medical expense benefit
- Fixed amount
- Multiple of the daily hospital room and board
- As other eligible expenses
What is the waiting period for maternity under medical expense
10 months
When is maternity care required to be provided by group policies
When the group has 15 or more employees (maternity has to be treated as any other allowable medical expense)
Define limited coverage policies
They will either cover specific perils, such as accident, drug or they will only provide a limited amount of coverage, such as credit disability and hospital indemnity
What is required on policies that cover limited perils
That the first page on the policy include a warning stating that “this is a limited policy” and advise the policyowner to read the policy carefully
What do accident policies cover
- Death
- Dismemberment
- Disability
- Hospital/medical care
But only if it is caused by an accident
Provide two examples of accident-only policies
- AD&D
- Travel accident
What does travel accident policies cover
Injuries or death
