Georgia Medicare Study

Question 1

What information are the members of the Medical Information Bureau required to report?

Answer 1

Adverse medical information about the applicants or insured

Question 2

When should an agent obtain a Statement of Good Health from the insured?

Answer 2

When the premium was paid upon policy delivery and NOT at the time of application

Question 3

Who is responsible for paying the cost of medical examinations required in the process of underwriting?

Answer 3

Insurer

Question 4

If an insurer decides to obtain medical information from different sources in order to determine the insurability of an applicant, who must be notified of the investigation?

Answer 4

The applicant

Question 5

What is the entire contract in health insurance underwriting?

Answer 5

The application and the policy issued

Question 6

Who must sign a health insurance application?

Answer 6

The policyowner, the insured (if different), and the agent.

Question 7

Whose responsibility is it to inform an applicant for health insurance about the insurer’s information gathering practices?

Answer 7

The agent

Question 8

In health insurance, the policy itself and the insurance application form what?

Answer 8

The entire contract

Question 9

If an agent makes a correction on the application for health insurance, who must initial the correct answer?

Answer 9

The applicant

Question 10

What entities make up the Medical Information Bureau?

Answer 10

Insurers

Question 11

If an underwriter requires extensive information about the applicant’s medical history, what report will best serves this purpose?

Answer 11

Attending Physician’s Statement

Question 12

What is the term used for a written request for an insurer to issue an insurance contract based on the provided information?

Answer 12

Application

Question 13

What is the best way to make a change on an application for insurance?

Answer 13

Start over with a fresh application

Question 14

What type of hospital policy pays a fixed amount each day that the insured is in the hospital?

Answer 14

Hospital Indemnity

Question 15

With key person disability insurance, who pays the policy premiums?

Answer 15

The business

Question 16

Can Alzheimer’s disease be excluded from coverage under a long-term care policy?

Answer 16

No, organic cognitive disorders, such as Alzheimer’s and Parkinson’s must be covered.

Question 17

How are HMO territories typical divided?

Answer 17

Geographic areas

Question 18

What type of injuries and services will be excluded from major medical coverage?

Answer 18

Injuries caused by war, intentionally self-inflicted injuries, injuries covered by workers comp., regular dental/vision/hearing care, custodial care, and elective cosmetic surgery.

Question 19

How can an HMO member see a specialist?

Answer 19

Referral by the primary care physician

Question 20

What does the amount of disability benefit that an insured can receive depend on?

Answer 20

The insured’s income at the time of policy application

Question 21

What is the main principle of an HMO plan?

Answer 21

Preventive Care

Question 22

Can a insured who belongs to a POS plan use an out-of network physician?

Answer 22

Yes, but the copays and deductibles may be higher

Question 23

What is COBRA?

Answer 23

To allow continuation of health insurance coverage for terminated employees

Question 24

What is a fee-for-service health plan?

Answer 24

Under a fee-for-service plan, providers receive payments for each service provided

Question 25

What type of health insurance would pay for hiring a replacement for an important employee who becomes disabled?

Answer 25

Key-person disability insurance

Question 26

What is the purpose of respite care in long-term care insurance?

Answer 26

To provide relief for a major caregiver (usually family member)

Question 27

Who are the parties in a group health contract?

Answer 27

The employer and the insurer

Question 28

What is the capital sum in Accidental Death and Dismemberment (AD&D) coverage?

Answer 28

A percentage of the principal sum

Question 29

What do individual insureds receive as proof of their group health coverage?

Answer 29

Certificate of Insurance (COI)

Question 30

In what type of health plans are providers paid for services in advance, regardless of the services provided?

Answer 30

Prepaid Plans

Question 31

In order to be eligible for coverage by an HSA, an individual must also be covered by what type of health plans?

Answer 31

HDHP- High deductible Health Plan

Question 32

What are the two types of Flexible Spending Accounts?

Answer 32

Health care accounts and dependent care accounts

Question 33

In health insurance, what is considered a sickness?

Answer 33

An illness that first arises while the policy is in force

Question 34

What is the primary purpose of disability income insurance?

Answer 34

To replace income lost due to a disability

Question 35

Who chooses a primary care physician in an HMO plan?

Answer 35

The individual member

Question 36

Insurers or agents soliciting partnership polices must provide each prospective applicant with all of the following EXCEPT:

Answer 36

A statement that the insured does not automatically qualify for Medicare Part A

Question 37

Which of the following is NOT covered under Plan A in Medigap insurance?

Answer 37

The Medicare Part A deductible

Question 38

All of the following statements about Medicare supplement insurance policies are correct EXCEPT:

Answer 38

They cover the cost of extended nursing home care

Question 39

When health care insurers negotiate contracts with health care providers or physicians to provide health care services for subscribers at a favorable cost, it is called:

Answer 39

Preferred Provider Organization (PPO)

Question 40

Other than for a qualified life event, when can a change be made in benefits for a Flexible Spending Account (FSA)?

Answer 40

During the open enrollment period

Question 41

Which of the following terms refer to the acts of soliciting insurance, making an insurance contract effective, and dealing with matters arising from that contract?

Answer 41

Transacting insurance

Question 42

An applicant for a health insurance policy returns a completed application to her agent, along with a check for the first premium. She receives a conditional receipt two weeks later. Which of the following has the insurer done by this point?

Answer 42

Neither approved the application nor issued the policy.

Question 43

The HMO Act of 1973 required employers to offer an HMO plan as an alternative to regular health plans if the company had more than 25 employees. How has this plan since changed?

Answer 43

Employers are no longer forced to offer HMO plans.

Question 44

Which of the following would be required to be licensed as an insurance producer?

Answer 44

A salaried employee who advertises and solicits insurance

Question 45

In an individual long-term care insurance plan, the insured is able to deduct the premiums from taxes. What income taxation will be imposed on the benefits received?

Answer 45

No tax

Question 46

Which of the following riders would NOT increase the premium for a policyowner?

Answer 46

Impairment rider

Question 47

Disability income policies can provide coverage for a loss of income when returning to work only part-time after recovering from total disability. What is the benefit that is based on the insured’s loss of earnings after recovery from a disability?

Answer 47

Residual disability

Question 48

Following an injury, a policyowner covered under Medicare Parts A & B was treated by her physician on an outpatient basis. How much of her doctor’s bill will she be required to pay out-of-pocket?

Answer 48

20% of covered charges above the deductible.

Question 49

Which statement regarding qualifications for Social Security disability benefits is NOT true?

Answer 49

The individual must be at least 65 years old

Question 50

All accident and health insurance policies issued in this state MUST include a grace period of at least?

Answer 50

30 days

Question 51

Which of the following is an example of a producer’s fiduciary duty?

Answer 51

The trust that a client places in the producer in regard to handling premiums.

Question 52

Which of the following statements is INCORRECT?

Answer 52

Replacing insurance policies for the purpose of making commissions is legal

Question 53

Insurers may change which of the following on a guaranteed renewable health insurance policy?

Answer 53

Rates by class

Question 54

What is the initial period of time specified in a disability income policy that must pass, after the policy is in force, before a loss can be covered?

Answer 54

Probationary period

Question 55

An insured is hospitalized with a back injury. Upon checking his disability income policy, he learns that he will not be eligible for benefits for at least 30 days. This indicates that his policy is written with a 20-day?

Answer 55

Elimination period

Question 56

All of the following are unfair claims settlement practices EXCEPT

Answer 56

Suggesting negotiations in settling the claim

Question 57

The requirements that agents not commingle insurance monies with their own funds is know as?

Answer 57

Fiduciary responsibility

Question 58

In the event a policy lapses due to nonpayment of premium, within how many days would the policy be automatically reinstated once the outstanding premium is paid?

Answer 58

45 days

Question 59

Health insurance policy lapses but is reinstated within an acceptable timeframe. How soon from the reinstatement date will coverage for the accidents become effective?

Answer 59

Immediately

Question 60

Which of the following is TRUE regarding Medicare Supplement policies?

Answer 60

These policies may not contain limitations of coverage except for those permitted by the pre-existing condition clause

Question 61

An insurance contract requires that both the insured and the insurer meet certain conditions in order for the contract to be enforceable. What contract characteristic does this describe?

Answer 61

Conditional

Question 62

Which of the following is TRUE regarding elimination periods and the cost of coverage?

Answer 62

The longer the elimination period, the lower the cost of coverage

Question 63

If an insurance company makes a statement that its policies are guaranteed by the existence of the Insurance Guaranty Association, that would be considered?

Answer 63

An unfair trade practice

Question 64

When doing business in this state, an insurance company that is formed under the laws of another state is known as which type of insurer?

Answer 64

Foreign

Question 65

Which of the following would best describe total disability?

Answer 65

A person’s ability to work is significantly reduced or eliminated for the rest of his/her life.

Question 66

Once an agent has met the requirements to sell long-term insurance partnership policies, how often must the agent complete the 4 hours of ongoing training courses?

Answer 66

Every 24 months

Question 67

An insurer that holds a Certificate of Authority in the state in which it transacts business is considered a/an

Answer 67

Authorized insurer

Question 68

The Medical Information Bureau (MIB) was created to protect

Answer 68

Insurance companies from adverse selection by high risk persons.

Question 69

What is the purpose of coinsurance provisions?

Answer 69

To help the insurance company to prevent overutilization of the policy

Question 70

On a participating insurance policy issued by a mutual insurance company, dividends paid to policyholders are

Answer 70

Not taxable since the IRS treats them as a return of a portion of the premium paid.

Question 71

Which is TRUE regarding the Uniform Individual Accident and Sickness Policy Provisions Law?

Answer 71

Provisions may be reworded by the insurer.

Question 72

An insurer filled a form with the Commissioners 90 days ago, but the Commissioner has yet to approve or disprove the form. What can the insurer do?

Answer 72

Consider the form approved and begin using it.

Question 73

Which type of misrepresentation persuades an insured, to their detriment, to cancel, lapse, or switch polices from one to another?

Answer 73

Twisting

Question 74

The legal process that gives the insurer, after payment of a loss, the right to seek recovery from a third party that was responsible for the losses known as

Answer 74

Subrogation

Question 75

Insurance that would pay for hiring a replacement for an important employee who becomes disabled is called

Answer 75

Key employee disability insurance.

Question 76

In insurance, an offer is usually made when

Answer 76

An applicant submits an application to the insurer

Question 77

Social Security Supplement (SIS) or Social Security Riders would provide for the payment of income benefits in each of the situations below EXCEPT

Answer 77

When the amount payable under Social Security is more than the amount payable under the rider.

Question 78

Which of the following statements concerning group health insurance is CORRECT?

Answer 78

The employer is the policyholder

Question 79

The maximum penalty that may be addressed for a single nonwillful violation of the Insurance Code is

Answer 79

$1,000

Question 80

All of the following are the most common variations in a Long-Term Care policy EXCEPT

Answer 80

Number of family dependents

Question 81

An insured is upset that her new health insurance policy was delivered to her by certified mail and not through her agent. Which of the following is TRUE?

Answer 81

There is NOTHING wrong with this form of policy delivery

Question 82

Ray has an individual major medical policy that requires a coinsurance payment. Ray very rarely visits his physician and would prefer to pay the lowest premium possible. Which coinsurance arrangement would be the best for Ray?

Answer 82

50/50

Question 83

The provision that states that both the printed contract and a copy of the application form the contract between the policyowner and the insurer is called the

Answer 83

Entire Contract

Question 84

Which of the following is NOT a responsibility of an insurance agent?

Answer 84

Underwriting the contract

Question 85

Which of the following would be considered an illegal inducement to purchase insurance?

Answer 85

Confirming future dividends in a life insurance proposal

Question 86

Which of the following best describes a misrepresentation?

Answer 86

Issuing sales material with exaggerated statements about policy benefits

Question 87

An employee insured under a group health policy is injured in a car wreck while performing her duties for her employer. This results in a long hospitalization period. Which of the following is TRUE

Answer 87

The group plan will not pay because the employee was injured at work.

Question 88

Under what condition are group disability income benefits received by an employee NOT taxable as income?

Answer 88

When the benefits received are equal or less than the employee’s percentage of the contribution

Question 89

State law specifically prohibits using illegal inducements in the marketing of insurance. All of the following would be considered illegal inducements EXCEPT

Answer 89

Inviting prospective clients to the grand opening of any company’s new office.

Question 90

All of the following are advantages of an HMO or PPO for a Medicare recipient EXCEPT

Answer 90

Elective cosmetic procedures are covered.

Question 91

Which of the following statements is NOT correct concerning the COBRA Act of 1985?

Answer 91

It requires all employers, regardless of the number or age of employees, to provide extended group health coverage.

Question 92

Which is TRUE regarding HMO coverage?

Answer 92

It is divided into Geographic territories