Questions and Answers
What does premium mode refer to?
Frequency of the premium payment
Which of the following is NOT an example of utilization review?
Which of the following typically does NOT provide a form of managed care?
What happens when an insurance policy is backdated?
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According to HIPAA, a 10% excise tax on early withdrawal from an IRA will not be applied if the withdrawal is used for medical expenses that exceed ____ of the individual's adjusted gross income.
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Which of the following is considered a tax-deductible medical expense under the rule that allows deductions for expenses exceeding 7.5% of adjusted gross income?
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What is one of the most important considerations when replacing health insurance?
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What is the difference between pre-certification and concurrent review?
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The contract is in force without the initial premium being paid.
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What is the tax consequence for XYZ Corp paying the tax-deductible insurance premiums for a key employee disability policy?
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Study Notes
Health Underwriting Concepts
- Premium Mode: Refers to the frequency with which premiums are paid.
- Utilization Review: Ongoing evaluation of care to determine the necessity and effectiveness; accident-prone individual inspections are NOT included.
- Managed Care Plans: Major medical indemnity plans typically do not offer managed care benefits.
Insurance Policy Details
- Backdating Insurance Policies: When a policy is backdated, its effective date is set earlier than the current date, impacting coverage.
- IRA Early Withdrawal Tax: A 10% excise tax is usually imposed on early withdrawals from an IRA, but is waived for medical expenses exceeding 7.5% of adjusted gross income (AGI) under HIPAA guidelines.
Tax Deductions and Health Expenses
- Tax-Deductible Medical Expenses: Medical expenses that surpass 7.5% of AGI can be deducted; long-term care insurance premiums qualify as a deductible expense.
Health Insurance Policy Considerations
- Replacing Health Insurance: When considering a new health insurance policy, exclusions listed in the new policy are crucial for evaluation.
- Pre-Certification vs. Concurrent Review: Pre-certification occurs prior to treatment, whereas concurrent review is conducted during the treatment process.
Health Policy Financial Implications
- Initial Premium Payment: A health policy is not activated until the initial premium has been received; coverage begins only after payment.
- Tax Consequences on Benefits: For key employee disability policies, premiums paid by an employer are tax-deductible, but benefits received under the policy are fully taxable to the employee.
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Description
Test your knowledge with these flashcards on health underwriting terms and concepts. Each flashcard presents a key term along with its definition, helping you to master important insurance terminology related to premium modes, utilization review, and managed care alternatives.
