Health and Accident Insurance Flashcards

Questions and Answers

How would the insurer handle a group health policy if 15 out of 50 members have major health issues?

Accept or reject the whole group.

What group medical plan provision applies when a claim has coverage under more than one health plan?

Coordination of benefits.

What percentage of eligible employees must participate in a noncontributory group health plan before it can be put in effect?

100%

Who is financially liable for the payment of covered claims in a fully insured group health plan?

Insurer. Signup and view all the answers

Buy-Sell Plans are typically funded by which two types of insurance?

Disability insurance Signup and view all the answers

A non-contributory group health plan must cover all eligible members.

True Signup and view all the answers

Which of the following is NOT typically covered under vision care insurance?

Eye surgery Signup and view all the answers

What must an eligible individual do to obtain group health insurance without providing evidence of insurability?

Enroll within a specified eligibility period. Signup and view all the answers

Coverage is limited for vision and dental insurance in all of the following ways, EXCEPT?

Specific dollar amount for examinations Signup and view all the answers

How many employees must an employer have for COBRA to apply?

20 employees. Signup and view all the answers

What issue does the problem of overinsurance address in health insurance?

Coordination of benefits. Signup and view all the answers

What is the purpose of minimum participation standards in group health insurance plans?

To prevent adverse selection. Signup and view all the answers

In an employer-sponsored group accident and health plan, a master contract is issued to the?

Employer. Signup and view all the answers

What does Coordination of Benefits allow?

Allows the secondary payor to reduce their benefit payments. Signup and view all the answers

Under HIPAA, what does the employee's new Group Health Plan verify regarding Creditable Coverage?

So that the employee's waiting period for coverage of a pre-existing condition can be reduced. Signup and view all the answers

What are Credit Accident and Health plans designed to do?

Help pay off existing loans during periods of disability. Signup and view all the answers

Health insurance involves two perils, accident and ________.

sickness. Signup and view all the answers

When can a group health policy renewal be denied according to HIPAA?

When contribution or participation rules have been violated. Signup and view all the answers

Which statement is TRUE regarding continued employment after 65 and coverage?

Medicare is the secondary payer Signup and view all the answers

What will happen to COBRA election for continuation of health coverage?

Maintain the same coverage and increase premium. Signup and view all the answers

How many employees must an employer have for a terminated employee to be eligible for COBRA?

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What is issued to each employee of an employer health plan?

Certificate. Signup and view all the answers

Under the subrogation clause, legal action can be taken by the insurer against the?

responsible third party. Signup and view all the answers

What happens to an employee's payroll contribution to an HSA without a Section 125 Plan?

It would be considered taxable income to the employee. Signup and view all the answers

What does Business Overhead Expense Insurance pay for?

Business expenses when a business owner becomes disabled. Signup and view all the answers

What does Key Person Disability Insurance pay benefits to?

Employer. Signup and view all the answers

If Ron cannot have more than a _____ day gap without previous health insurance after changing employers?

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What is the limited period of time given to all members to sign up for a group health plan called?

Enrollment period. Signup and view all the answers

What type of group Disability Income plan pays tax-free benefits to covered employees?

Fully-contributory. Signup and view all the answers

A common exclusion with Vision plans is:

Laski surgery Signup and view all the answers

How are disability income benefits from a group policy treated for tax purposes?

Taxable income. Signup and view all the answers

Who is considered a possible applicant and contract policyholder for group health benefits?

Employer. Signup and view all the answers

Which type of business insurance covers the costs of continuing to do business while the owner is disabled?

Business overhead expense policy. Signup and view all the answers

On what basis may group health plans deny participation?

Member's part-time employment status. Signup and view all the answers

Sole proprietors are permitted tax deductions for health costs paid from their earnings in the amount of?

100% of costs. Signup and view all the answers

Which provision would be payable under a disability income policy if the cause of an injury is unexpected and accidental?

Accidental bodily injury provision. Signup and view all the answers

Who is the policyholder for a group health benefit plan considered to be?

Employer. Signup and view all the answers

What is the change called when an insured individual changes coverage from a group health insurance plan to an individual plan with the same insurer?

Conversion. Signup and view all the answers

Which of the following regulations does NOT apply to Coordination of Benefits?

Preferred Provider Organization Plans Signup and view all the answers

What is the purpose of the Coordination of Benefits provision in group accident and health plans?

Avoid overpayment of claims. Signup and view all the answers

Which of the following decisions would a Health Saving Account (HSA) owner NOT be able to make?

The amount contributed by the employer Signup and view all the answers

According to HIPAA, what kind of information is considered as 'individually identifiable health information'?

A person's health claim information. Signup and view all the answers

Health insurance typically covers which of the following perils?

Injury due to accident. Signup and view all the answers

In which type of policy can a master contract and certificate of coverage be found?

Group. Signup and view all the answers

Which of the following would evidence ownership in a participating health insurance contract?

Policy ownerships Signup and view all the answers

According to HIPAA, what happens when an insured individual leaves an employer and immediately begins working for a new company that offers group health insurance?

The individual is eligible for coverage upon hire. Signup and view all the answers

When can a group health policy renewal be denied according to the Health Insurance Portability and Accountability Act (HIPAA)?

When participation or contribution rules have been violated. Signup and view all the answers

What does COBRA of 1985 allow an employee to do?

In the event of employment termination, group health insurance can be kept if the employee pays the premiums. Signup and view all the answers

What are the rights called that an insurer has to recover payment made to the insured from the negligent party?

Subrogation. Signup and view all the answers

Which of the following would NOT provide continued coverage under COBRA?

Gross misconduct termination Signup and view all the answers

What is the contract called that is issued to an employer for a Group Medical Insurance Plan?

Master Policy. Signup and view all the answers

What provision applies when a claimant has coverage under more than one health plan?

Coordination of benefits. Signup and view all the answers

Which of the following is INELIGIBLE to participate in a Section 125 Plan?

S-Corp Owner with a greater than 2% share Signup and view all the answers

If an employee contributes 50% toward a disability plan premium, what would be considered the taxable income of a $1,000 monthly disability benefit?

$500. Signup and view all the answers

What is the coverage issued to a person covered with an individual health plan?

Policy. Signup and view all the answers

When are group disability benefits considered to be tax-free to the insured?

When the recipient pays the premiums. Signup and view all the answers

In an employer-sponsored contributory group Disability Income Plan, how much tax is applicable on benefits paid if the employer pays 60% of the premium?

60% of the benefit. Signup and view all the answers

On what date would Sonya have coverage after applying for a health insurance policy?

May 30. Signup and view all the answers

According to COBRA, a terminated employee's benefits must meet which requirements?

Be the same and the premium cannot exceed 102%. Signup and view all the answers

Under group health insurance, which document is issued to the employee?

Certificate. Signup and view all the answers

What type of contract is known as a single contract issued to an employer for group medical insurance?

Master Policy. Signup and view all the answers

Which of the following is typically NOT eligible for coverage in a group health policy?

Temporary employees Signup and view all the answers

Study Notes

Health Insurance Overview

Underwriting for group health policies may lead insurers to accept or reject the entire group based on health issues discovered.
Claims can be managed under multiple plans through coordination of benefits, ensuring no more than 100% of a claim is covered.

Group Health Insurance Requirements

For noncontributory group health plans, 100% participation from eligible employees is required before activation.
The insurer is financially liable for claims in fully insured group health plans.
A non-contributory plan must cover all eligible members without contributions from members.

COBRA and Continuation of Coverage

COBRA applies to employers with at least 20 employees, allowing terminated employees to maintain health coverage by paying premiums.
Benefits under COBRA must match what employees had previously, and premiums cannot exceed 102% of the cost.

Essential Health Insurance Provisions

Coordination of Benefits helps manage overlapping coverage and addresses overinsurance issues.
Minimum participation standards exist to prevent adverse selection in group health plans.

Tax Implications and Coverage Types

Disability benefits can be taxable depending on who pays the premiums, affecting the tax status of received benefits.
Key Person Disability Insurance pays benefits directly to the employer to cover business expenses.

Enrollment and Eligibility

Individuals must enroll within a specified eligibility period to obtain group health insurance without proving insurability.
A 63-day gap without prior insurance can make individuals ineligible for pre-existing condition coverage under new group plans.

Health Savings Accounts and Contributions

A Section 125 Plan is essential for non-taxable payroll contributions to Health Savings Accounts (HSAs); otherwise, contributions are taxed.
HSA owners cannot dictate employer contributions, which are separate from employee decisions.

Types of Health Insurance Policies

A master policy is issued to employers for group health insurance, providing coverage for employees through certificates of coverage.
Temporary employees generally do not qualify for group health policies, which typically cover full-time or eligible employees.

Important Policy Features

Conversion from group health to individual plans occurs after job termination, ensuring continuity of care.
The subrogation clause allows insurers to seek recovery from responsible third parties for claims paid out.

Definitions and Special Circumstances

Business Overhead Expense Insurance helps manage ongoing business costs during disability.
Vision care typically does not cover eye surgery, highlighting the importance of understanding policy exclusions.

HIPAA Regulations

Under HIPAA, individuals moving to new employers with health plans are eligible for immediate coverage if they leave previous insurance.
Individually identifiable health information under HIPAA includes specific health claim details.

Claims and Benefits

Group disability income plans that offer tax-free benefits only apply if employees pay the premiums.
Vision plans often limit coverage, commonly excluding laser surgery for vision correction.

Conclusion

It's vital to understand various aspects of health and accident insurance, including enrollment periods, tax implications, and the structure of group plans, to make informed decisions regarding health coverage.

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Description

Test your knowledge on health and accident insurance concepts with these flashcards. Each card covers essential terms and definitions necessary for understanding health policy underwriting and claims. Perfect for students or professionals in the insurance industry.