Health Insurance Provisions Overview

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Questions and Answers

What does the insuring clause primarily identify?

The duration of the policy

The insured and the type of loss covered (correct)

The conditions for claims processing

The premium payment schedule

How long is the typical free-look period for health insurance policies?

15 days

5 days

10 days (correct)

30 days

Which of the following best describes the purpose of the free-look provision?

To allow cancellation for a refund after review (correct)

To outline the terms of renewal

To detail the obligations of the insurer

To define the insured's rights in a claim

What must insurers do regarding any additional provisions not included in the Uniform Mandatory Provisions?

Ensure they are conflict-free and state-approved Signup and view all the answers

What is one requirement for individual health insurance policies?

They must include mandatory provisions Signup and view all the answers

Which clause helps define the rights and duties of each party in the insurance contract?

Insuring clause Signup and view all the answers

Which of the following is typically excluded from health insurance coverage?

War Signup and view all the answers

What kind of medical expenses are covered as eligible expenses?

Emergency medical services Signup and view all the answers

For mental health coverage, what limits are usually imposed?

Lifetime maximum benefit Signup and view all the answers

Which condition might temporarily suspend a health insurance policy's coverage?

Travel outside of the country Signup and view all the answers

Which of the following describes a reduction in health insurance benefits?

Decrease in benefits due to specified conditions Signup and view all the answers

What is a common limit for outpatient treatment of substance abuse?

Limit on the maximum amount per visit Signup and view all the answers

What is the primary purpose of a deductible in an insurance policy?

To lower premiums for the insured Signup and view all the answers

Which type of deductible requires each insured individual to meet the deductible limit personally?

Individual deductible Signup and view all the answers

What does the consideration clause require from both parties involved in a contract?

Both parties must provide valuable consideration. Signup and view all the answers

What is a family deductible designed to do?

Allow two or more family members to share the deductible responsibility Signup and view all the answers

Which statement accurately describes the probationary period?

It requires a waiting period before coverage for specific conditions starts. Signup and view all the answers

In which scenario does a common accident provision apply?

When multiple family members are injured in a single incident Signup and view all the answers

What is the function of an integrated deductible in supplemental plans?

It allows basic medical expenses to count toward the deductible Signup and view all the answers

What is the purpose of the elimination period in a disability income policy?

To delay the payment of benefits until after a specified period. Signup and view all the answers

What occurs during the waiver of premium provision in the case of total disability?

Premiums are waived for a specified duration. Signup and view all the answers

What does a carry-over provision allow an insured person to do?

Use last three months' expenses toward the next year's deductible Signup and view all the answers

What is a per occurrence deductible?

A flat amount paid for each individual claim Signup and view all the answers

Which of the following best describes the intention behind the probationary period?

To avoid unnecessary administrative costs from employee turnover. Signup and view all the answers

In the context of the waiver of premium, what typically happens during the specified waiting period?

The insured must continue to pay but may receive refunds later. Signup and view all the answers

How does the size of a deductible affect the insurance premium?

Larger deductibles typically decrease premiums Signup and view all the answers

What happens to the waiver of premium rider when the insured reaches age 65?

It becomes void regardless of disability status. Signup and view all the answers

Which of the following is NOT a provision commonly found in disability income policies?

Sick leave adjustment Signup and view all the answers

What is a pre-existing condition in health insurance terms?

A condition for which care was received before applying for coverage Signup and view all the answers

Which statement about the Affordable Care Act and pre-existing conditions is correct?

It eliminated restrictions on pre-existing conditions for most health plans Signup and view all the answers

In a typical coinsurance arrangement, what percentage does the insured usually pay after meeting the deductible?

20% Signup and view all the answers

What is the purpose of a coinsurance provision?

To share costs and prevent overutilization of the policy Signup and view all the answers

What is a stop-loss limit in health insurance?

A fixed amount beyond which the insurance pays 100% Signup and view all the answers

How does a copayment differ from coinsurance?

Copayment has a fixed dollar amount per service Signup and view all the answers

Which of the following is NOT true about pre-existing conditions under the Affordable Care Act?

They must be covered under all insurance plans Signup and view all the answers

What effect does a higher coinsurance percentage paid by the insured typically have on premiums?

Reduces the required premium amount Signup and view all the answers

What are Eligible Expenses in the context of health insurance?

Medical expenses covered by the health insurance plan Signup and view all the answers

What is required before undergoing procedures that need pre-authorization?

The insured must obtain prior approval from the insurer Signup and view all the answers

In health insurance, what does Usual, Reasonable, and Customary (URC) mean?

Average charges for a procedure in a specific geographic area Signup and view all the answers

What is a lifetime limit in health insurance?

The total benefit during the entire period of coverage Signup and view all the answers

Which type of maximum benefit is defined as the most a policy will pay each year?

Annual limit Signup and view all the answers

How does a per-cause limit work in health insurance?

It limits benefits based on the specific medical condition Signup and view all the answers

Study Notes

Other Provisions and Clauses in Health Insurance

Uniform Mandatory Provisions must be included in all individual health insurance policies.
Insuring Clause identifies the agreement between the insurance company and the insured, detailing coverage and responsibilities.
Free Look provision allows insured to review the policy for a specified number of days (commonly 10) and return it for a full refund if unsatisfied.
Consideration Clause establishes that both parties must provide valuable consideration; the insured pays premiums, and the insurer promises coverage.
Probationary Period requires a waiting time before coverage for specific conditions is activated, often seen in disability income policies.
Elimination Period acts as a deductible in disability policies; benefits are payable only after a specified number of days post-incident.
Waiver of Premium provision waives future premiums during total disability after a waiting period, typically 3 to 6 months.

Pre-existing Conditions

Pre-existing conditions refer to health issues treated prior to applying for coverage.
The Affordable Care Act eliminated pre-existing condition restrictions in most health insurance plans, but exceptions exist for disability and long-term care.

Coinsurance provisions dictate shared expenses, commonly with the insurer covering about 80% after the deductible is met.
Variations of coinsurance arrangements can include 90/10 or 75/25 percentages to influence premium costs.
Stop-loss limits prevent excessive out-of-pocket expenses; once reached, the insurer covers 100% of remaining costs.

Copayment provisions specify a fixed amount the insured pays for services, differing from coinsurance.
Deductibles are amounts required to be paid by the insured before benefits kick in; can vary as individual, family, or per occurrence deductibles.
Integrated deductibles can satisfy amounts across different covered services within a policy year.

Exclusions and Limitations

Exclusions denote causes of loss not covered by the policy, including war, self-inflicted injuries, and cosmetic procedures.
Temporary suspensions of coverage may occur for insureds residing abroad or serving in the military.
Mental and emotional disorders often have limited coverage benefits and visit allowances, distinct from inpatient treatment provisions.

Eligible Expenses and Approval Requirements

Eligible Expenses encompass covered medical costs as outlined in the policy.
Pre-authorization may be required for certain procedures to ensure coverage approval prior to the service.

Benefit Limits

Maximum Benefit Limits determine the ceiling on policy payouts, categorized as lifetime, annual, or per-cause limits.
Lifetime limits cap total payouts over the insured's life, while annual limits restrict amounts per year. Per-cause limits apply to expenses for related health issues.

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Description

Explore the key provisions and clauses that individual health insurance policies must include. This quiz covers the mandatory provisions required by state regulations as well as additional provisions that insurers can incorporate. Test your understanding of the framework governing health insurance policies.