Chapter 8: Health Insurance General Flashcards
TF:While life insurance covers the risk of loss caused by physical death, health insurance covers the risk of loss caused by a “living death.”
True
Health insurance is intended to insure the risk of ____ _____ caused by accidental injury or illness and associated medical costs.
Income loss
TF: Each state uses different terminology to refer to health insurance, such as “accident and health” or “accident and disability.”
True
Two perils of health insurance?
Accidental Injury
Sickness (Medical condition, disease, or illness)
Four basic types of losses and benefits for health insurance?
Loss of income from disability,
Medical expense,
Dental expense, and
Long-term care expense.
Disability benefits are valued at a _______ of the insured’s lost income
percentage
_____ _____ & ______ policies pay a lump sum payment if the insured dies in an accident, or loses major body parts in an accident.
AD&D
_______ _________ insurance covers the cost of medical treatments, physician’s fees, hospitalization and other medical costs that ensue when the insured incurs an accidental injury or sickness
Medical Expense
______ insurances provides coverage for small groups that are not large enough to apply for group coverage.
Franchise - each individual applicant undergoes underwriting
Health insurances is provided by _____ and ______.
Private commercial carriers
the government
Health insurance provided by the government is also called _____ insurance and includes (3 examples….)
Social
Medicare
Medicaid
Tricare
_______ provides health insurance coverage to ppl over the age of 65
Medicare
______is a state and federally funded medical assistance program for financially disadvantaged individuals
Medicaid
______ replaced CHAMPUS, the Civilian Health and Medical Program of the Uniformed Services
TRICARE
Three types of TRICARE plans available?
Prime
Extra
Standard
______ version of TRICARE is the least costly and is like an HMO
Prime
_____ version of TRICARE allows enrolees to receive medical care through a PPO arrangement
Extra
_____ version of TRICARE allows enrollees to receive medical care from any medical provider, but is the most expensive
Standard
Health insurance policies are renewable according to five renewability classes:
Cancellable,
?
?
?
Non-cancellable.
Optionally Renewable
Conditionally Renewable
Guaranteed Renewable
Factors affecting health insurance premiums?
Interest,
Expense,
Morbidity, and
Benefits provided by the policy.
________ is the rate people are expected to become disabled from accident or sickness in a year
Morbidity
For health insurance, _____ policies are often participating, whereas _____ policies are often non-participating
Group
Individual
_________ means the policyholder receives shares/dividends of the company surplus.
Participating
Two types of reserves in health insurance?
Premium reserves and
Loss reserves (claims reserves).
________ are considered a liability for insurers, NOT an asset
Reserves
For health insurance claims, processes are slightly _______ complex than life insurance
more
Medical expense contracts are _____________ based (meaning the benefit is based on the amount of loss incurred). Whereas life/AD&D and disability pay on a value basis, where a stated amount is paid out
Reimbursement
Two types of medical plan basis’s?
Fee for service Basis
Prepaid Basis
Basis: With a ______ basis, medical providers are compensated on a service basis rather than a dollar basis.
Prepaid Basis
Basis: With a ________ Basis, providers are paid on a “dollar” basis for each service they provide
Fee for Service Basis
Medical expense plans may be _______ coverage or limited policies, such as vision plans or cancer coverage.
Specified
__________ polices provide broad health care coverage including preventive care, immunizations, outpatient and inpatient care. HMOs are a good example of this
Comprehensive
Medical expense plans may pay benefits on a _____ in which coverage is specifically identified by procedure or treatment with a fixed amount.
Schedule
Other plans may use the __________ method in which the insurer pays an amount for each procedure or treatment based on the average charges in that geographic area.
Usual, Reasonable, and Customary Charges
TF: In an emergency situation, the insured is not limited to the provider list.
True
_______ -The term insured refers to individuals who are covered by non-prepaid health plans.
Insured
_______ - This term for a participant/member refers to individuals who receive health insurance benefits on prepaid or service plans.
Subscribers
Nonparticipating health insurance policies (nonpar) pay dividends to _________, not policyholders.
Shareholders
__________ policies tend to have higher premiums because insurers incorporate a deliberate overcharge as a safety margin.
Participating
Medical expense insurance may cover all of the following, EXCEPT:
Select one:
a. Accidental injury
b. Physician’s fees
c. Prescriptions
d. Disability income
D
TF: Medical expense insurance covers the cost of medical treatments, physician’s fees, hospitalization and other medical costs that ensue when the insured incurs an accidental injury or sickness. Disability income insurance pays a portion of the insured’s income while the insured is disabled and unable to work.
True
Which health insurance policy pays periodic benefits to an insured?
Select one:
a. Medical expense
b. Disability income
c. Fee-for-service plans
d. Accidental death and dismemberment
B
All of the following are specific types of government health insurance programs, EXCEPT:
Select one:
a. TRICARE
b. Medicare
c. Medicaid
d. HMO
D
The principal losses related to accident and health insurance are:
Select one:
a. Loss of income from disability and medical expenses from the cost of medical treatments, physician’s fees, hospitalization and prescriptions
b. Loss of earning power caused by premature death
c. Loss of retirement income caused by prolonged life
d. All of the above
A
Which payment method is used to pay medical providers for each service they provide, and only for the medical services insureds use?
Select one:
a. Fee-for-service basis
b. Prepaid basis
c. Service basis
d. Valued basis
A
All of the following are type of benefits that are offered under health insurance, EXCEPT:
Select one:
a. Accidental death and dismemberment
b. Dental expense
c. Long-term care policy
d. Traditional IRAs
D
Health insurance covers:
Select one:
a. The risk of loss caused by a living death
b. The risk of premature death
c. The risk of prolonged life
d. The risk of liability
A
TF: While life insurance covers the risk of loss caused by physical death, health insurance covers the risk of loss caused by a living death.
True
Which of the following is not true regarding medical expense policies?
Select one:
a. Covers the insured and the insured’s dependents
b. Perils covered include accidental injury and sickness
c. Benefits may include hospitalization costs and treatments
d. Pays loss of income benefits
D
Why is disability insurable with health insurance?
Select one:
a. Because disability may prevent a person from earning an income.
b. Because disability is part of the natural aging process.
c. Because disabilities are costly.
d. Because disability is a life insurance risk.
A
TF: Loss of income from disability occurs when an accidental injury or sickness prevents an insured from being able to work. Disability income insurance policies replace income lost while the insured is unable to work.
True
