Chapter 12 - Medical Expense Policies

Question 1

Terms and Characteristics

Answer 1

Reimbursement plans are designed to reimburse the insured for bills paid

Fee for service - a method of charging for each service performed

Assignment - to give a right to another

Managed care - an attempt to contain cost by becoming involved in the care being provided

Question 2

Basic Plans

Answer 2

Characterized as plans with low limits, specific benefits and first dollar coverage

Basic Hospital:
- room and board
- miscellaneous medical expenses

Basic Surgical:
- expense of surgery
- scheduled and sold in units

Basic Medical:
- doctor visits

Question 3

Major Medical plans

Answer 3

Characterized by:
- Catastrophic coverage - high or unlimited benefits
- Comprehensive coverage - designed to cover most needs
- Inside limits - limits on specific coverage’s within the policy
- Eligible expenses (usual, necessary, customary) - based upon that geographical area
- Deductibles - the amount retained by the insured
- Coinsurance - percentage participation
- Stop loss or out of pocket maximum

Question 4

Miscellaneous Issues

Answer 4

Emergency care is always provided

Conversion rights for dependents

Rights of newborn or adopted
- covered immediately
- 31 days to make payment if required

Children may be included on their parents plan up to age 26, regardless of dependency

Children may stay on parents plan beyond the age of maturity if:
- physically or mentally dependent
- proof must be furnished within 31 days