Unit 12: Introduction to Health Insurance Flashcards
Accident
unintentional bodily injury caused by an unforeseen event
Sickness
a need for medical care due to a cause other than an accident
Pre-existing Condition
illness or disease that existed before an individual’s health insurance went in to effect
individual plans
Anyone can apply for coverage
Each person has a policy
Individual can choose coverage from whatever is available in the health insurance markets
Individual’s health is evaluated. A medical exam may be required
Coverage renewable at option of the insured, sometimes insurer
All accidents are covered regardless of when or where they occur
group plans
Only group members may be covered. Group must meet size and purpose definitions
There is one master contract. Individuals are given certificates as evidence of coverage
Benefits are essentially the same for all group members. Individuals may be able to choose among a limited number of pre-established packages.
Group as a whole is evaluated; usually no individual underwriting. No evidence of insurability required if individual enrolls within a given time after becoming eligible
Group sponsor may change coverage. Coverage stops when insured leaves the group
Only off-the-job accidents are generally covered. On-the-job accidents are covered by workers’ compensation, a state-mandated program
limited perils
while medical expense plans cover losses that arise from almost any cause with just a few exceptions, _______ plans cover losses that rise only from one peril or one type of peril, or which occur relative to a specific situation or location
limited benefit plans
while medical expense plans have moved quickly toward providing very high or unlimited benefits, the amounts paid by ______ plans are typically much smaller and often restricted to stated amounts
Notice to proposed insured
assure that insureds understand the limited nature of the coverage that are buying, states require these polices to contain a prominent notice on their first page stating that the coverage provides only limited benefits
Limited Plans
cover very specific types of losses
not comprehensive
ex: accident only, critical illness, hospital income, credit disability, blanket, prescription drugs, vision, hearing, short-term medical expense plans
Accident-Only Limited Insurance
only cover accidents a peril, and exclude any type of sickness or disease.
Smaller premiums
may also pay a benefit if an accident results in dismemberment, disability, or death
Specified (Dread) Disease/Critical Illness Insurance
covers one, or one type, of catastrophic illness specified in the policy such as cancer or heart disease.
ex: stroke, coma, liver failure, kidney failure, and paralysis
benefits are strictly limited to those diseases specifically named in the policy
some policies pay a lump sum benefit upon diagnosis of a specified disease and don’t offer the full cost of every treatment
Hospital Income (Indemnity) Insurance
pays a flat dollar amount as a daily benefit for each day the insured is hospitalized as an inpatient
payment is directly to the insured
Credit Disability Insurance
group policy with the retailer as a master policyowner and the debtors are the group members.
the amount of coverage under the policy cannot be more than the amount of indebtedness remaining under the credit contract at any time, so the disability benefit may not exceed the monthly credit installment payment, or if the insurance coverage calls for a lump sum benefit, the amount of coverage will decrease over time as installment payments are made on the debt
consumers must be clearly notified that they are buying credit insurance coverage as part of the transaction
blanket coverage
type of group insurance where the group members are identified as the person engaged in a similar activity
ex: employees at a company picnic, passengers on an airplane, students on school grounds
members are automatically covered when they are part of the group, and coverage automatically ceases when the person is no longer part of the group.
No application for insurance on certificates of coverage
Prescription drugs
can be include in a medical expense plan, added as a supplement to a medical expense plan, or issued as a stand-alone coverage.
insureds must us a specific network to receive benefits
generally do not cover every drug
