Ch 7 Group Accident and Health Insurance Flashcards
A lender of funds
Creditor
A borrower of funds
Debtor
A provision that allows coverage to continue beyond the policies expiration date for employees who are not actively at work due to disability or who have dependence hospitalized on that date (coverage continues only until the employee returns to work or the dependent leave the hospital)
Extension of benefits
The health insurance portability and accountability act is a federal law that protects health information
HIPAA
The tendency or likelihood of insurance policies not lapsing or being replaced with insurance from another insurer
Persistency
A non-insured plan that uses a trust fund to pay for employees healthcare expenses directly
Self funded programs
Risk selection and classification process
Underwriting
The policy owner (employer) receives the master policy, each insured receives a certificate of insurance.
True
Group health insurance uses __________________ for premium determination
experience rating
True or false group health plans typically cost less than individual plans?
True
Evidence of insurability is not required during the annual open enrollment period and group policies
True
Coordination of benefits (COB) provision ensures and benefits are not paid in excess of the total losses incurred
True
Covers for dependents under cobra may be extended to _____ months in the event of employees divorce or death
36 months
Characteristics of group insurance
- Group formed for a purpose other than attending group health insurance
- Master policy - issue to the group sponsor
- certificates of insurance - evidence of coverage for the insured’s
- experience rating: premium based on group is whole
- Community rating: premium based on insurer claims experience
experience rating: premium based on group as whole
premium based on group as whole
Community rating:
premium based on insurer claims experience
Types of eligible groups
- Employer sponsored – individual or multiple employer trust (MET)
- Association – alumni or professional
Advertising
Trustful and non-misleading
Jurisdiction
Covers for more than one state, approved in issuing state
Underwriting
- every eligible member of group must be covered regardless of physical condition, age, sex or occupation
- evidence of insurability generally not required
- 30 day open enrollment period
- probationary employees must work a total of 30 hours per week
Provisions
- conversion to an individual coverage – within 31 days without evidence of insurability
- coordination of benefits
- change of insurers – carryover of coinsurance and deductibles
Qualifying events
- Voluntary termination of employment
- termination of employment for reasons other than gross misconduct (e.g. company downsizing)
- employment status change: from full-time to part-time
Length of coverage
- 18 months - after qualifying event
- 36 months - for dependence after events such as death of the employee, divorce or legal separation
In group health insurance, who receives certificates of insurance?
The employees (insureds)
Group health insurance is subject to what type of rating?
Experience rating
Group health insurance is generally eligible for what two types of groups?
Employer-sponsored groups and associations
Master policy
employeer holds the insurance policy
Insureds receive certificates of insurance (certificate of coverage)
True
Non contributory plan
Employeer pays 100% of the premium (100% participation)
Contributory plan
Employeer and employees pay the plan. (75% participation)
MET’s must be in the same line of work
Multiple business sharing insurance cost.
Coordination of benefits provision
Found only in group health plans
purpose to avoid duplication of benefits when an insured is covered under multiple plans.
COBRA (continuation of group health coverage for terminated employees)
- employees must apply within 60 days of termination
- coverage extends for up to 18 months
- 36 months for dependents after employee’s death or divorce
- employee pays 102% of premium.
