Deck 9: Insuring Your Health

Question 1

Long-term-care insurance provides protection against the cost of extended hospital stays.

Answer 1

False

Question 2

An elimination period is the number of days that must pass before disability policies pay the benefits.

Answer 2

True

Question 3

Premiums for workers' compensation insurance are paid by the employees.

Answer 3

False

Question 4

Workers' compensation insurance will make compensation payments to an injured worker _____.

A)only if he has been hurt on the job
B)only if he cannot prove negligence on the part of his employer
C)only if the worker has a take-home salary of $5,000 or more
D)only if his or her spouse is unemployed
E)only if the worker has a minimum of four dependents

Question 5

Large employers are less likely to offer health insurance to their employees than small employers.

Question 6

Blue Cross provides hospital coverage and Blue Shield provides prescription pharmacy coverage.

Question 7

Living a healthy lifestyle is an example of loss prevention and control.

Question 8

Disability insurance is available only when someone is completely incapable of returning to work during his or her lifetime.

Question 9

A preferred provider organization has characteristics of both an individual practice association (IPA)and an indemnity plan.

Question 10

Which of the following statements is true of medical insurance costs in the U.S.?

A)Advances in medical technology have decreased the medical insurance costs.
B)The average annual premium for the aging U.S.population has increased by about 20% from 1999 to 2015.
C)A poor demand-and-supply distribution of health care facilities and services has increased the health care costs.
D)Increased regulation and decreased administrative costs have reduced the medical insurance costs in the U.S.
E)Due to the financial importance of health insurance,nearly 50 percent of the U.S.population has health insurance.

Question 11

Millions of Americans are not covered by health insurance.

Question 12

During the past few decades,the percentage of our income spent on health care:

A)has increased due to an aging U.S.population.
B)has decreased due to costly advances in medical technology.
C)has increased due to advanced demand-and-supply distribution of health care facilities.
D)has decreased due to increased regulation and decreased administrative costs.
E)has decreased due to the reduction in the health care costs.

Question 13

All group insurance plans extend health insurance benefits to retirees.

Question 14

You would have a better chance of choosing your own doctor with a preferred provider organizations (PPO)plan than with a health maintenance organizations (HMO)plan.

Question 15

Which of the following is true of the workers' compensation insurance?

A)Self-employed people pay lower premium to their employees for workers' compensation insurance as compared to corporate employees.
B)Workers' compensation insurance includes only rehabilitation expenses.
C)Employers are required to bear half of the entire cost of workers' compensation insurance.
D)Workers' compensation insurance compensates workers who are injured on the job or become ill through work-related causes.
E)Compensation received from the insurance coverage is based on historical usage; employees who file the least claims pay the lowest premiums on the insurance coverage.

Question 16

Under the adjusted (modified)community rating approach to health insurance premium pricing,all policyholders in an area pay the same premium without regard to their personal health,age,gender,or other factors.

Question 17

Medicare and Medicaid are administered by hospitals and physicians.

Question 18

Health Maintenance Organizations (HMOs)provide health care to participants without requiring them to file insurance claims.

Question 19

Generally,group insurance plans are more reasonably priced than individual policies.

Question 20

Advances in medical technology,drug prescriptions,and treatments have substantially reduced the cost of health care in recent decades.

Question 21

Which of the following statements is true of the Affordable Health Care Act (ACA)?

A)The ACA eliminates lifetime limits on total health care insurance payments by insurers.
B)The ACA limits the total number of surgeries for the insurers.
C)The ACA requires employers to reimburse the cost of hospital stay of the insured.
D)The ACA decides the insurance payments for dependents.
E)The ACA provides major medical insurance with low deductibles to protect against catastrophic illnesses.

Question 22

People under the age of 65 years are covered by Medicare health insurance plan if:

A)they agree to pay a negotiated fee for medical services.
B)they have been denied health insurance because of a pre-existing condition.
C)they volunteer to pay premiums.
D)they are injured on the job or become ill through work-related causes.
E)they receive monthly Social Security disability benefits.

Question 23

In a traditional indemnity (fee-for-service)plan,:

A)the health care provider and the insurer are separate.
B)the insurer always pays directly to the health care provider.
C)the lower the deductible,the lower the premium.
D)the insured receives comprehensive health care services from a designated group of doctors only.
E)the health care provider contracts with the insured's employee union to provide health insurance benefits.

Question 24

Ben's (aged 40)health coverage charges a low ($15)deductible each time he visits a doctor or hospital.Other than the low per-service deductible,there is very little cost sharing.However,Ben has the advantages lack of deductibles,few or no exclusions,and not having to file insurance claims.Which of the following most likely provides Ben's health coverage?

A)HMO
B)Blue Cross/Blue Shield association
C)Commercial insurer (major medical)
D)Medicare
E)Fee-for-service indemnity plan

Question 25

The Medicare co-insurance payment is typically:

A)0 percent.
B)50 percent.
C)10 percent.
D)20 percent.
E)75 percent.

Question 26

The community rating approach to health insurance premium pricing _____.

A)advocates offering Social Security Medicare program to all individuals irrespective of their age
B)favors the government's contribution to the health savings account (HSA)
C)prohibits insurance companies from varying rates based on health status or claims history
D)considers only medical insurance coverage from a private insurance company
E)offers consumer directed health plans that go one step beyond a flexible-benefit plan

Question 27

Which of the following is true of the health care industry?

A)In the fee-for-service plans,the health care provider is the same as the insurer.
B)In a traditional indemnity plan,the premium cost is low if it is a high-deductible plan.
C)In managed care plans,employers contract with the health care service provider.
D)In traditional indemnity plans,the government waives the doctor's fees or the hospital charges.
E)A group health insurance is a contract between pharmaceutical companies and the health care provider.

Question 28

An individual receiving health care:

A)is allowed to receive a one-time payment only from his/her insurance company for this care.
B)is allowed to receive multiple payments from only two insurance companies for this care.
C)is allowed to receive multiple payments from more than one insurance company for this care.
D)is allowed to receive either compensation from the employer or a one-time payment from only one insurance company for this care.
E)is allowed to receive payments from his/her employer only twice in his/her lifetime.

Question 29

Employees should consider risk assumption for certain health risks because:

A)these are covered by Social Security.
B)they are required to pay health care costs when their insurance coverage lapses.
C)they would rather pay small amounts from savings than higher premiums to cover them.
D)they need not look for ways to avoid exposure to risks before they occur.
E)they will eliminate some or all of the factors from their lifestyle and reduce their chances of becoming ill.

Question 30

The Affordable Care Act (ACA)requires insurance companies to adhere to:

A)the pure community rating approach for individuals and small businesses.
B)the adjusted community rating approach for individuals and small businesses.
C)the modified community rating approach for SEC registered corporations.
D)the unadjusted community rating approach for SEC registered corporations.
E)the cost-of-living adjustment (COLA)for individuals and small businesses.

Question 31

Which of the following statements is true of the health reimbursement account (HRA)?

A)The entire health care cost of employees is reimbursed and deposited in a health reimbursement account by the employer.
B)The premium amount for the insurance policy of dependents is reimbursed and deposited in a health reimbursement account by employer.
C)The amount of unused money in the health reimbursement account can be rolled over annually.
D)The employer's contribution to the health reimbursement account is taxable.
E)The health reimbursement account balance is replenished by the insurance company when the account balance is used up.

Question 32

One of the key goals of the Affordable Health Care Act of 2010 is:

A)to increase the amount of Social Security taxes.
B)to reduce the number of uninsured citizens in the country.
C)to provide health care coverage to the employers employing less than 50 full-time employees.
D)to underwrite the employee health care coverage on behalf of employers.
E)to tax workers for job-related illness or injury.

Question 33

An exclusive provider organization (EPO)is _____.

A)a hybrid form of health maintenance organization (HMO)that reimburses members a specified percentage of the cost
B)a managed care plan that reimburses members only when affiliated providers are used
C)a managed care plan in which subscribers receive services from physicians practicing from their own offices
D)a hybrid form of health maintenance organization (HMO)that allows members to go outside the HMO network for care
E)a prepaid hospital and medical expense plan that allows members to use nonaffiliated providers

Question 34

In the pure community rating approach to health insurance premium pricing,all policyholders in an area pay:

A)a premium equal to the premium payable to the federal or state insurance exchange for a similar insurance policy.
B)premiums based on their family size,where they live,whether they use tobacco,and their age.
C)the same premium without regard to their personal health,age,or gender.
D)the premium as a contribution to a community pool of funds and utilize it on a need basis.
E)premiums at varied rates based on their health status or claims history.

Question 35

Group health insurance premiums are _____.

A)lower than an employer's health insurance plan premiums
B)paid by the insurer to the insured
C)designed to cover only comprehensive medical expenses
D)equal to the reimbursements of medical expenses on claims for medical treatment
E)only meant to offer coverage for prescription drug,dental,and vision care services

Question 36

Employers set up a salary reduction agreement with the employees if:

A)employees pay hospitalization charges for the pre-existing conditions.
B)employees pay health care costs due to lapse of insurance coverage.
C)employees need additional insurance benefits.
D)employees do not look for ways to avoid exposure to health care loss before it occurs.
E)employees are injured on the job or become ill through work-related causes.

Question 37

Which of the following is a public assistance program that provides health insurance benefits only to those who are unable to pay for health care?

A)Medicare
B)Medicaid
C)Blue Cross/Blue Shield
D)Point-of-service (POS)plan
E)Workers' compensation

Question 38

Funds for Medicare benefits come from:

A)monthly payments by users directly to the health care service organization.
B)the co-payment for health care services by the insured.
C)the premiums paid by the employers for the employees.
D)Social Security taxes paid by covered workers and their employers.
E)the health care service organization.

Question 39

A supplementary medical insurance (SMI)provides health care protection beyond the basic hospital coverage for:

A)all Medicare recipients.
B)all social security recipients.
C)all workers' compensation insurance recipients.
D)Medicaid recipients who pay for SMI on a voluntary basis.
E)anyone age 65 or over who pays premiums on a voluntary basis.

Question 40

Some employers providing health insurance as an employee benefit offer only one plan and pay _____.

A)the entire health care cost for employees
B)the entire health care cost for dependents of employees
C)the entire health care premium only for dependents of employees
D)either all or part of the health care insurance premiums
E)the entire cost of the additional insurance benefit desired by employees

Question 41

In order to qualify for disability insurance under Social Security,a person must be:

A)unable to carry out the duties of the current job.
B)unable to carry out the duties of any job.
C)ill for at least two years.
D)willing to undergo rehabilitation.
E)unable to pay health insurance premium for more than 6 months.

Question 42

Medicare is a government-sponsored health care plan composed of Part A and Part B.Part B covers ___________. ​

A)post-hospital medical services
B)therapy,rehabilitation,and home health care
C)inpatient hospital services
D)imaging,laboratory tests,and prosthetic devices

Question 43

A _____ is standard in disability income policies.

A)deflation protection
B)noncancelable agreement
C)long-term-care insurance
D)waiver of premium
E)home insurance coverage

Question 44

Medicare is a government-sponsored health care plan composed of Part A and Part B.Part A provides ___________. ​

A)prescription drug coverage
B)services of physicians and surgeons
C)inpatient hospital services
D)home health services

Question 45

Disability income policies usually have a(n)_____,which is a time delay from the date of the issuance of the policy until benefit privileges are activated.

A)waiting period
B)probationary period
C)elimination period
D)internal limit period
E)outer limit period

Question 46

The maximum coverage under most dental policies is often in the range of _____ per patient.

A)$1,500 to $2,500
B)$2,000 to $2,500
C)$1,000 to $2,500
D)$1,500 to $2,000
E)$3,000 to $5,000

Question 47

The average age of the American population ___________. ​

A)has been constant over the last three decades
B)is increasing
C)is projected to be constant for the next three decades
D)is decreasing

Question 48

An insured individual's right to continue a health insurance policy if he or she chooses is known as:

A)policy exclusion.
B)co-insurance.
C)co-payment.
D)benefits duration
E)renewability.

Question 49

___________ is a health care plan that emphasizes cost control and preventive treatment. ​

A)An indemnity plan
B)A fee-for-service plan
C)A managed care plan
D)A supplementary medical insurance

Question 50

One drawback of long-term-care insurance is its:

A)high annual premiums.
B)overlap with Medicare.
C)inability to cover custodial care.
D)short duration..
E)non-renewability clause..

Question 51

The insurance designed to help with nursing home or in-home care due to chronic illness is called:

A)Medicare.
B)major medical plan.
C)comprehensive major medical plan.
D)nursing home care.
E)long-term care.

Question 52

A ___________ is a hybrid form of health maintenance organization (HMO)that allows members to go outside of the HMO network for care. ​

A)point-of-service (POS)plan
B)Blue Cross/Blue Shield plan
C)fee-for-service plan
D)traditional indemnity plan

Question 53

Which of the following changes would tend to increase the premium on a disability policy?

A)A shorter elimination period
B)Use of "any occupation" definition of disability instead of "own occupation to which one is reasonably suited"
C)Decreasing the benefit level to 50% from 66% of prior earnings
D)Decreasing the payment period until age 65 to a maximum of 2 years
E)Mandatory disability insurance in which the employer pays the entire premium

Question 54

Patrick's monthly take-home pay is $5,000.His net worth is $125,000.He estimated that he would receive Social Security benefits worth $1,000 and company disability benefits $2,000 if he becomes disabled.The additional disability benefits that he needs to arrange for equals _____.

A)$3,000
B)$2,000
C)$5,000
D)$6,000
E)$7,000

Question 55

The purchasing power of income from a long-term disability policy is protected by _____.

A)the Affordable Health Care Act (ACA)
B)the Cost-of-living adjustment (COLA)provision
C)Medicare benefits
D)Social Security income
E)the Health reimbursement account (HRA)

Question 56

Which of the following is true of long-term care insurance?

A)Long-term-care policies do not reimburse the insured for the cost of services incurred on a day-to-day basis.
B)The maximum duration of benefits is only one year.
C)There is no waiting period to receive the benefits.
D)Most long-term-care insurance policies are non-renewable in nature.
E)Many policies offer inflation protection riders for an additional premium.

Question 57

When trying to determine your disability income needs,you should consider your available disability benefits from employers,income needs,and:

A)Social Security benefits.
B)wage policy.
C)non-monetary incentives.
D)flexible benefits.
E)income tax bracket.

Question 58

Michael's estimated current monthly take-home pay is $4,500.His total existing monthly benefits is $2,950.Michael's estimated monthly disability benefits is _____.

A)$1,550
B)$550
C)$2,950
D)$7,450
E)$4,500

Question 59

A good health insurance plan embodies more than financing medical expenses,lost income,replacement services; it incorporates ___________. ​

A)Social Security benefits
B)flexibility in insurance premium payment on the lapse of the insurance policy
C)lifetime limited dollar insurance coverage on pre-existing conditions
D)means of risk reduction such as risk avoidance

Question 60

Long-term care is a term used to describe _____.

A)the inflation protection riders in the insurance policy
B)the delivery of medical care to persons with chronic medical conditions in a nursing home
C)the coverage for a serious illness or accident that prevents an insured person from working for an extended period
D)an extended period of hospital stay due to a serious illness or accident
E)compensation provided to the workers who are injured on the job or become ill through work-related causes.

Question 61

A ___________ covers the cost of visits to a doctor's office or for a doctor's hospital visits,including consultation with a specialist. ​

A)surgical expense insurance
B)hospitalization insurance policy
C)elective surgery insurance
D)regular medical expense insurance

Question 62

When purchasing a long-term-care policy,___________. ​

A)the optional renewability provision is recommended
B)the guaranteed renewability provision is recommended
C)the non-renewability provision is recommended
D)the automatic renewability at reduced premium is recommended

Question 63

A coordination of benefits provision in a health care policy ___________ by collecting benefits in multiple payments for health care. ​

A)prohibits collecting more than 100 percent of covered charges
B)allows the collection of only 75 percent of covered charges
C)prohibits collecting more than 80 percent of covered charges
D)allows the collection of only 50 percent of covered charges

Question 64

Disability income insurance will provide income to a disabled or ill person ___________. ​

A)without a waiting period
B)with unlimited funds for years
C)with a waiting period before income is received
D)with payments made to the recipient up to age 70

Question 65

The ACA's provisions relating to long-term care include the Community Living Assistance Services and Support Program (CLASS),which will be administered by ___________. ​

A)the U.S.Department of Health and Human Services
B)private insurance providers
C)the Social Security administration
D)the government

Question 66

___________ represents the initial amount that's not covered by the policy and thus must be paid by the insured. ​

A)The deductible
B)The co-insurance
C)The copayment
D)The premium

Question 67

If you are laid off,your group health insurance ___________. ​

A)can be continued if the employer chooses to
B)must be continued if you pay the premiums
C)must be continued and your ex-employer pays the premiums
D)is continued and is paid by Social Security

Question 68

Medicare and Medicaid cover ___________. ​

A)more than half of the total cost of long-term care
B)all the costs related to long-term care
C)less than half of the total cost of long-term care
D)the balance between the actual medical cost and the coverage amount

Question 69

Dependent children ___________ will usually be covered by your health insurance policy. ​

A)regardless of age
B)up to a stated maximum age
C)up to two in number
D)regardless of their employment