Chapter 8: Health Plans Flashcards

1
Q

Employer Administered Plans: In ______ plans, the employer provides funding for claim payments for its employees and their dependents.

A

Self-Funded

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2
Q

The self-funded plan can be supplemented by a ____-_____ contract so the employer’s liability is limited and an insurer will pay the claims in excess of the employer’s expected claims.

A

Stop Loss

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3
Q

Employer Administered Plans: In ______ plans, the employer provides the funding, and the insurer handles all claims processing.

A

Administrative Services Only

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4
Q

Employer Administered Plans: In_______ plans, An employer can contract out the claims processing to a _____ (same answer), which will lower the administrative costs that would have been charged by the insurance company.

A

Third Party Administrator

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5
Q

_______ ______can be used by charitable organizations to fund employee health benefit plans.

Unlike traditional self-funded plans, contributions to these are immediately tax deductible, and earnings grow tax-deferred.

A

501(c)(9) Trusts

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6
Q

Employers with few employees, usually less than _____ or ____ depending on state law, can establish a small employer health plan.

A

25 or 50

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7
Q

_____ ____ allow employees to choose which health care benefits and coverages they want from a list of options. This allows employees to pay for and receive health care coverage catered to their unique needs.

A

Cafeteria Plans - best utilized for larger employers

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8
Q

Health plans can be provided through ______ and _________

These are trusts established by two or more employers to provide health coverage to their employees.

A

Multiple Employer Trusts (METs)
Multiple Employer Welfare Arrangements (MEWAs)

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9
Q

______ ______ provides medical expense benefits, disability income benefits, rehabilitation and occupational therapy benefits, and a one-time death benefit.

A

Workers Compensation

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10
Q

_____ plans are employer sponsored plans, such as wellness plans, which foster healthier lifestyles for employees. Such wellness plans focus on healthy diets and physical exercise (e.g., Weight Watchers or Biggest Loser).

A

Worksite

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11
Q

Two types of “other group” plans?

A

Blanket
Franchise

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12
Q

_______ plans insure a group of individuals while they are participating in the same activity, such as a group of high schoolers going on a class trip

A

Blanket

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13
Q

_______ plans permit small groups to obtain health insurance. The coverage usually costs less and contains some of the benefits of group health insurance.

A

Franchise

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14
Q

TF: Franchise plans are the same as group plans in that the entire group is underwritten under one policy (instead of individual policies)

A

False - In franchise plans, each individual is issued an individual policy

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15
Q

TF: In a Franchise plan, each individual pays separate premiums

A

False - the franchise only pays one group premium

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16
Q

TF: Franchise is not technically group coverage

A

True

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17
Q

The producer must ensure the replacement is for the ______ benefit.

A

insured’s

18
Q

The ______ is responsible for comparing the existing coverage with the proposed replacing coverage.

A

Producer

19
Q

The producer should discuss the consequences of policy replacement, such as ____ _____ and _______, with the insured.

A

policy exclusions
limitations

20
Q

The length of time pre-existing conditions may be excluded varies by type of health insurance policy and the state insurance laws regulating such policies, but the conditions are typically excluded if pre-existing for more than ____ months.

A

18

21
Q

TF: Pre-existing conditions may be excluded from the replacing policy for a certain period of time.

A

True

22
Q

The producer should compare the ______, _____ and ______ of the replacing policy with that of the existing policy, so the insured is aware of the differences between the policies.

A

benefits
limitations
exclusions

23
Q

_______ is performed for replacement policies in health insurance

A

Underwriting

24
Q

TF: The replacing policy will typically not be issued if it provides the same benefits, exclusions, and limitations as the insured’s existing policy.

A

True

25
Q

TF” The producer must avoid misrepresenting the replacing policy. Any misrepresentation could cause the producer to lose their license.

A

True

26
Q

Insurers and many producers carry _____ and _____ insurance to protect themselves from liability.

A

Errors and Omissions (E&O)

27
Q

TF: E&O = Professional Liability Insurance

A

True

28
Q

In health insurance policy replacement, producers should be sure there is no ___ in ___. This means that the replacement policy’s effective date is the same date that the existing policy coverage ends.

A

Gap in Coverage

29
Q

The outline of coverage discloses important details about the policy including the following information:

A

Names of the insurer and agent
Type of policy and riders
Description of the policy benefits and coverage
Information regarding the policy exclusions and limitations
Information regarding renewal and cancellation provisions

30
Q

All of the following are underwriting considerations for replacing health insurance coverage, EXCEPT:
Select one:
a. Underwriting is performed for replacement health insurance policies.
b. The replacing policy will typically not be issued if it provides the same benefits, exclusions, and limitations as the insured’s existing policy.
c. Replacing coverage may be pricier and have fewer benefits than the existing coverage.
d. It is the applicant’s responsibility to assure the replacing coverage is for the insured’s best interest.

A

D

31
Q

Which of the following plans allows employees to receive health care catered to their unique needs?

Select one:
a. Workers Compensation
b. Worksite plan
c. Blanket plan
d. Cafeteria plan

A

D

32
Q

Which of the following is not an employer administered health plan?
Select one:
a. Workers’ Compensation
b. 501(c)(9) trusts
c. Cafeteria Plans
d. METs and MEWAs

A

A

33
Q

Adam’s Paint Company provides all funds for its group health insurance plan, but uses an insurance company for the processing of claims. Which plan does Adam’s Paint Company use?
Select one:
a. PPO
b. POS
c. ASO
d. HSA

A

C

34
Q

Who is responsible for giving the applicant the outline of coverage for a health insurance policy?
Select one:
a. Insured
b. Applicant
c. Producer
d. Underwriter

A

C

35
Q

Producers must be careful when an insured wants to replace existing health insurance coverage. Considerations do not include:
Select one:
a. Pre-existing conditions
b. Benefits, limitations and exclusions
c. Underwriting requirements
d. Claims procedures

A

D

36
Q

This type of health coverage is available to smaller groups who are not large enough to qualify for group health plans:
Select one:
a. Individual health insurance
b. Franchise insurance
c. Blanket insurance
d. Limited insurance

A

B

37
Q

An employer that has a self-funded health plan, but contracts out claims processing, has hired a(n):
Select one:
a. ASO
b. TPA
c. MET
d. MEWA

A

B

38
Q

TF: An employer can contract out the claims processing to a third party administrator (TPA).

A

True

39
Q

Which of the following is not a responsibility of the insurer in individual health insurance?

Select one:
a. Content of health policies
b. Disclosure method of policies
c. Providing the applicant the Outline of coverage
d. Control of marketing materials

A

C

40
Q

All of the following are true regarding franchise health insurance, EXCEPT:

Select one:
a. Each individual covered receives an individual policy.
b. Franchise coverage is not technically group insurance.
c. Each individual applying for coverage must complete an individual application.
d. Each individual pays a separate premium.

A

D