Health Insurance: Basics Flashcards
Health Insurance:
What are 2 kinds of Perils?
Health Insurance: Basics
- Accident
- Sickness
Definition:
Accident
Health Insurance: Perils
Unintentional bodily injury caused by an unforeseen event
Definition:
Sickness
Health Insurance: Perils
The need for medical care due to a cause other than an accident
Definition:
Pre-existing Condition
Health Insurance: Basics
An illness/disease that existed before an Individual’s Health Insurance went in to effect
What are the 4 Primary Types of
Health Insurance Coverage/Benefits?
Health Insurance: Basics
- Hospital/Medical Expense Coverage
- Disability Income Insurance
- Dental Expense Insurance
- Long-Term Care (LTC) Insurance
What are the 5 Types of
Government Health Insurance?
Health Insurance: Basics
- TRICARE (Active Military Members)
- Veterans (Former Military Members)
- Medicare (Senior Citizens & Social Security Disability)
- Medicaid (Low Income Individuals)
- Social Security Disability
Whar are the Differences?:
Limited vs. Comprehensive Coverage
Health Insurance: Basics
Limited Coverage
* Coverage for a particular type of loss
Comprehensive Coverage
* Broad coverage for (most) health care services
Key Points:
Limited (Benefit) Coverage
3 Parts
Health Insurance: Basics
Limited Perils
* Losses that arise from 1 (type) peril (i.e. Cancer)
* Losses that occur relative to a specific situation/location
Limited Benefits
* Typically much smaller amounts (than Comprehensive)
* Often restricted to stated amounts
Notice to Insured
* Policies are required to contain a prominent notice on their 1st page stating that the coverage provides Limited Benefits
Definition:
Accident-Only Policies
4 Parts
Limited (Benefit) Policies
- Only cover “Accidents” as a peril
- Exclude any type of sickness/disease
- Smaller Premiums
- May pay a benefit if an accident results in dismemberment, disability, or death
Definition:
Specified (Dread) Disease Policies
Limited (Benefit) Policies
(a.k.a. Critical Illness Plans)
Cover a specific Catastrophic Illness/Disease (must be specified in the Policy)
Examples:
1. Cancer
2. Heart Disease
3. Stroke
4. Coma
5. Paralysis
6. Liver or Kidney Failure
7. Organ or Bone Marrow Transplants
Definition:
Hospital Income (Indemnity) Insurance
2 Parts
Limited (Benefit) Policies
- Pays a flat dollar amount as a daily benefit for each day that the
insured is hospitalized as an inpatient - Payment is made directly to the insured, not to the hospital
Definition:
Credit Disability Insurance
3 Parts
Limited (Benefit) Policies
- Retailers/Lenders who extend credit for a large purchase will often require the consumer to have “Credit Disability Insurance” to secure the loan
- If the consumer (debtor) becomes disabled, the policy’s benefit is paid to the creditor (lender) to pay off the loan
- Considered a Group Policy
The Retailer = Master Policyowner
The Consumers = Group Members
Definition:
Blanket Coverage
4 Parts
Limited (Benefit) Policies
- A type of Group Insurance
- “Group Members” = Everyone engaged in a similar activity
- Automatic Coverage Start and Stop:
Starts = Person becomes part with the “Group”
Stops = Person is no longer part of the “Group” - Since coverage is always changing, the Individual Members are never named
Examples:
Blanket Coverage
4 Parts
Limited (Benefit) Policies
- Employees at a company picnic
- Passengers on an airplane
- Players/Spectators at a sporting event
- Students while they are on school grounds
Definition:
Prescription Drug Coverage
2 Parts
Limited (Benefit) Policies
Generally…
* Insureds must use a specific network of pharmacies
* Plans do not cover every drug
Covered prescriptions are named in the plans “Formulary”
* Must include at least 1 drug in every non-elective therapeutic category
Key Points:
Prescription Drug Coverage
2 Parts
Limited (Benefit) Policies
2 Ways to Receive Benefits:
* Insured is reimbursed for their prescription drug expenses (via a Claim Form)
* Insured receives a Prescription Drug Card for a (participating) pharmacy
Prescription Drug Card:
* Insured pays a co-pay to the pharmacy for each prescription
* Generic-Brand Co-Pay: $5-$10
* Brand-Name Co-Pay: $15+
How is Prescription Drug Coverage Issued?
3 Parts
Limited (Benefit) Policies
- Included in a Medical Expense Plan
- Added supplement to a Medical Expense Plan
- Issued as Stand-Alone Coverage
Definition:
Vision Care
1 Part / 4 Coverage Examples
Limited (Benefit) Policies
“Gap Coverage” for things not covered by a Medical Expense Policy
Typically covers all/most expenses related to:
* Eye Exams
* Lenses/Frames
* Contact Lenses
* Other “Corrective” Needs
Definition:
Hearing Insurance
1 Part / 2 Coverage Examples
Limited (Benefit) Policies
“Gap Coverage” for things not covered by a Medical Expense Policy
Provides coverage for:
* Hearing Exams
* Some/All expenses for Hearing Aids
Definition:
Short-Term Medical Expense Plans
Limited (Benefit) Policies
Temporary Health Insurance
An Individual who is in the “Waiting Period” for their Group Insurance Policy but wants to make sure they still have Medical Coverage
(Most Common Situation)
Key Points:
Short-Term Medical Expense Plans
4 Parts
Limited (Benefit) Policies
- Limited Benefits for a Low Cost
- Typical Length of Coverage - 90 Days / 6 Months / 12 Months
- Not Renewable
- Qualification Required
Health Insurance:
What are the 5 Most Common Exclusions?
Health Insurance: Basics
- Intentional or Self-Inflicted Injuries
- War or Act of War
- Elective Cosmetic Surgery
- Workers Compensation
- Felony
