Chapter 12: Government Regulations

Question 1

The _____ ____ ____ and ____ ____ was passed by Congress in 1996 to protect the coverage of individuals and their families when they change or lose their jobs.

Answer 1

Health Insurance Portability and Accountability Act

Question 2

HIPAA also established privacy standards for individuals. As a federal law, HIPAA applies to groups with ____ or more employees. However, most states have their own version of HIPAA regulations that now protect small employer groups with as little as ___ employees.

Answer 2

50
2

Question 3

An individual who moves from one job to another is eligible for guaranteed issue (i.e., coverage is issued without regard to the individual’s health conditions; no underwriting, and no medical questions on the application) under the new employer’s health plan if the individual’s total creditable coverage is at least ____ _____

Answer 3

18 months

Question 4

If a gap in creditable coverage of more than ____ ____occurs, the new employer coverage can impose a waiting period. A worker with group health coverage who becomes self-employed must be eligible for coverage.

Answer 4

63 days

Question 5

Pre-existing conditions are defined as medical advice, diagnosis, care, or treatment was recommended or received within no more than _____ months before the date of the enrollment of the policy.

Insurers may set limitations or exclusions for pre-existing conditions for up to _____ months. However, an insurance company may look back at least ____ months when considering pre-existing conditions for a late enrollee.

Answer 5

6
12
18

Question 6

Insurers must provide a certificate of creditable coverage to policyholders within ____ ____ of coverage ending, or upon the request of the policyholder within ____ ____ of the coverage ending. The certificate provides proof of prior insurance and guarantees issue of a new policy.

Answer 6

30 days
24 months

Question 7

HIPAA requires that insurers guarantee ______ of individual health insurance policies except for:

Nonpayment of premiums,
Violation of plan terms or conditions,
Termination of coverage, or
Fraud.

Answer 7

Renewability

Question 8

While the insurance company must renew policies each year, the law does allow for a ______ increase, as long as the increase applies to the entire class of policies.

Answer 8

premium

Question 9

HIPAA mandated benefit: ______ illnesses must be covered on the same basis as ______ illnesses (mental health parity).

Answer 9

Mental
Physical

Question 10

HIPAA mandated benefit: HIPAA requires that hospital stay benefits be provided to mothers for _____ hours after a normal vaginal delivery and ____ hours after a cesarean delivery.

Answer 10

48
96

Question 11

HIPAA mandated benefit: TF: Maternity is not a pre-existing condition. Insurers of group health policies must treat maternity like any other sickness or accident.

Answer 11

True

Question 12

HIPAA established a standard for communicating Protected Health Information (PHI).

PHI is any information concerning an individual’s…? 6 items

Answer 12

Current medical status,
Prior medical history,
Health status,
Diagnoses,
Treatments, or
Payments for healthcare linked to the individual.

Question 13

Insurers must disclose PHI to an individual within ___ ____ of request (note: by individual, this means the person to which the PHI pertains – i.e., the patient).

Answer 13

30 days

Question 14

The ____ ____ _____ ____ ____. enacted by Congress, allowed individuals and their dependents to continue their group health coverage after a qualifying event (termination of employment or reduction of hours) for up to ___ months.

Answer 14

Consolidated Omnibus Budget Reconciliation Act
18

Question 15

COBRA: Covered dependents are eligible for coverage up to ____ _____ if the insured’s coverage is terminated due to:

Death,
Divorce,
Legal separation,
The insured became eligible for coverage under Medicare, or
The dependent loses dependency status.

Answer 15

36 months

Question 16

COBRA only applies to employers with _____ or more employees.

Answer 16

20

Question 17

3 Qualifying events that trigger COBRA continuation of coverage provisions include?

Answer 17

Termination of employment
Death of employee
Loss of eligibility due to an employee’s reduction in work hours

Question 18

TF: Coverage under COBRA is exactly the same as coverage provided under the group health plan.

Answer 18

True

Question 19

COBRA: Individuals must request continuation of coverage within ___ days of termination and may be required by the former employer to pay up to _____ of the premium rate for their class of coverage to offset additional administrative costs.

Answer 19

60
102%

Question 20

TF: Continuation of coverage under COBRA ceases for the following disqualifying events:

The insured is eligible for Medicare.
The insured is covered by another group health plan that does not have pre-existing condition exclusions.
Premiums are not paid within the 30-day grace period.
The employer terminates all group health coverages.
COBRA benefit period ends.

Answer 20

True

Question 21

Employer consequences for failure to adhere to COBRA provisions for a terminated employee?

Answer 21

IRS excise taxes and private lawsuits and fines under ERISA. Furthermore, employers may be liable for past and future medical expenses during the qualified beneficiary’s continuation period.

Question 22

The Omnibus Budget Reconciliation Act (OBRA) passed by Congress extended COBRA benefits to ____ months if the individual becomes disabled during the first ____-day period of coverage under COBRA.

Answer 22

29
60

Question 23

If the individual recovers during the _____ extra months provided under OBRA, then OBRA continuation coverage will end.

Answer 23

11

Question 24

Dependents of an individual who becomes entitled to Medicare benefits will be eligible for up to _____ months of COBRA coverage.

Answer 24

36

Question 25

The Tax Equity and Fiscal Responsibility Act (TEFRA) enacted by Congress ended the discriminatory practices of some employer group term life and health insurance plans in favor of ____ _____

Answer 25

key employees

Question 26

Key employees include?

Answer 26

Company officers,
All individuals owning 5% or more of the company,
Individuals owning more than 1% of the company and who receive compensation of $150,000 or more annually, and
The top 10 investors.

Question 27

TF: TEFRA also made Medicare coverage secondary to any group health plan(s) under which an individual is covered.

Answer 27

True

Question 28

The ____ ____ ____ ____ _____ was enacted by Congress to protect pensions, but it also protects group insurance plan participants. It requires insurers to maintain an increased standard for reporting and disclosure requirements for group health insurance plans. It also requires insurers to file plan summaries with the Department of Labor for review and insurers must file annual financial reports with the IRS.

Answer 28

Employee Retirement Income Security Act (ERISA)

Question 29

TF: The Employee Retirement Income Security Act (ERISA) has the following responsiblities

Answer 29

Acting solely in the interest of plan participants and their beneficiaries and with the exclusive purpose of providing benefits to them;
Carrying out their duties prudently;
Following the plan documents (unless inconsistent with ERISA);
Diversifying plan investments; and
Paying only reasonable plan expenses.

Question 30

The _____ _______ in ______ _____ was enacted by Congress to prevent discrimination of employees who are age 40 or older.

Answer 30

Age Discrimination in Employment Act

Question 31

The ADEA prohibits _____ _____ of employees other than executives or other managerial or policymaking positions.

Answer 31

forced retirement

Question 32

TF: Under ADEA, Employee benefits must be continued for older workers, although some benefit reductions are allowed.

Answer 32

True

Question 33

TEFRA amended ADEA by allowing employers to offer better coverage to younger employees and not to older employees and their dependents.

Answer 33

False - requires

Question 34

The ADEA only applies to employers with ____ or more employees.

Answer 34

20

Question 35

The ____ ____ ____ ____ enacted by Congress prohibits employer discrimination of any term, condition, or privilege of employment, including insurance coverage, based on the disability of an individual.

Answer 35

Americans with Disabilities Act (ADA)

Question 36

TF: Under the ADA, Disabled employees must have equal access to the same health insurance coverage and limitations as other employees. Coverage may not contain exclusions or limitations for the disability of the insured.

Answer 36

True

Question 37

The ADA included deafness, AIDs, cancer, muscular dystrophy, and kidney disease, among others, which may not be excluded or limited from coverage. The ADA only applies to employers with ______ or more employees.

Answer 37

15

Question 38

Arthur’s group health coverage is terminated, but he is permitted to extend his coverage for up to 29 months. What federal legislation permits Arthur’s coverage to continue?
Select one:
a. HIPAA
b. TEFRA
c. OBRA
d. COBRA

Answer 38

C

Question 39

TF: OBRA extends COBRA benefits from 18 to 29 months if the individual becomes disabled during the first 60 days of coverage under COBRA.

Answer 39

True

Question 40

Which federal law made Medicare secondary to group health coverage?
Select one:
a. ADA
b. ADEA
c. ERISA
d. TEFRA

Answer 40

D

Question 41

Premiums for COBRA are paid by:
Select one:
a. The former employer
b. The former employee
c. The NAIC
d. All of the above

Answer 41

B

Question 42

HIPAA requires that hospital stay benefits are provided to mothers for ___ hours after a normal vaginal delivery.
Select one:
a. 36
b. 48
c. 72
d. 96

Answer 42

B

Question 43

Which of the following best describes creditable coverage?
Select one:
a. Prior health coverage
b. Credit health insurance
c. Insurance issued by a credit union
d. None of the above

Answer 43

A

Question 44

TF: Creditable coverage is prior health insurance coverage, which is used to establish eligibility under HIPAA.

Answer 44

True

Question 45

COBRA only applies to employers with ____ or more employees.
Select one:
a. 2
b. 10
c. 20
d. 100

Answer 45

C

Question 46

Which law protects the coverage of individuals and their families when they change or lose their jobs?
Select one:
a. COBRA
b. HIPAA
c. TEFRA
d. ERISA

Answer 46

B

Question 47

TF: The Health Insurance Portability and Accountability Act (HIPAA) was passed by Congress in 1996 to protect the coverage of individuals and their families when they change or lose their jobs.

Answer 47

True

Question 48

This federal law prohibits age discrimination, and is applicable to employers that have at least 20 employees:
Select one:
a. ERISA
b. TEFRA
c. COBRA
d. ADEA

Answer 48

D

Question 49

Based on HIPAA legislation, pre-existing conditions can be imposed for a maximum of ____ months for employer-sponsored health plans.
Select one:
a. 5
b. 9
c. 12
d. 18

Answer 49

C