Medical Expense Insurance Quiz & Flashcards for Chapter Exam

Questions and Answers

How much will the insured be responsible to pay with $11,000 in covered medical expenses assuming a $1,000 deductible and an 80/20 Coinsurance clause?

3000

Which of the following costs would a Basic Hospital/Surgical policy likely cover?

Surgically removing a facial birthmark (correct)

Cosmetic surgery

Dental work

Routine check-ups

Which of these is NOT a characteristic of a Health Reimbursement Arrangement (HRA)?

Funds can carry over to next year

Employee funds the HRA entirely (correct)

Utilized for out-of-pocket medical expenses

HRA plans are employer-funded

Which of the following phrases refers to the fees charged by a healthcare professional?

Usual, customary, and reasonable expenses Signup and view all the answers

If J is hospitalized and receives a bill for $10,000, how much would J pay with a $2,000 deductible and an 80/20 Coinsurance clause?

3600 Signup and view all the answers

Which statement BEST describes the intent of a Coinsurance clause in a Major Medical policy?

Discourages overutilization of the insurance coverage Signup and view all the answers

To qualify for a tax-exempt Health Savings Account, what must the individual be enrolled in?

High-deductible health plan Signup and view all the answers

Major Medical policies typically contain a deductible and coinsurance.

True Signup and view all the answers

What BEST describes a Hospital Indemnity policy?

Coverage that pays a stated amount per day of a covered hospitalization Signup and view all the answers

What defines usual, customary, and reasonable (UCR) charges?

The maximum amount considered eligible for reimbursement by an insurance company under a health plan Signup and view all the answers

Basic Hospital and Surgical policy benefits are lower than the actual expenses incurred.

True Signup and view all the answers

How much will the insured have to pay if $15,000 in covered medical expenses are incurred with a $5,000 deductible and an 80/20 Coinsurance clause?

7000 Signup and view all the answers

What would be this family's out-of-pocket medical expenses for 2013 if their Hospital/Surgical Expense policy was issued with a $500 deductible and a limit of four deductibles per calendar year?

1000 Signup and view all the answers

In order to establish a Health Reimbursement Arrangement (HRA), it must be established by whom?

The employer Signup and view all the answers

All of the following statements about Major Medical benefits are true EXCEPT

Benefits have no maximum limit Signup and view all the answers

What does a major medical policy typically provide?

Benefits for reasonable and necessary medical expenses, subject to policy limits Signup and view all the answers

What do comprehensive Major Medical policies usually combine?

Major Medical with Basic Hospital/Surgical coverage Signup and view all the answers

In the case of a heart condition that was concealed on an insurance application, what is likely to occur when a claim is submitted?

The company will continue coverage but exclude the heart condition Signup and view all the answers

All of the following are limited benefit plans EXCEPT

Life insurance policies Signup and view all the answers

What does a Basic Medical Expense policy cover in terms of hospitalization?

Hospital room and board Signup and view all the answers

Match the following health coverage types with their descriptions:

Major Medical = Broad coverage for extensive medical expenses Basic Hospital = Covers room and board in a hospital Dread disease insurance = Coverage for specific types of illnesses Limited benefit plans = Coverage with restrictions and lower payout limits Signup and view all the answers

What is the provision in a Major Medical policy that requires the insured to pay part of the costs?

Coinsurance Signup and view all the answers

What does a Basic Hospital policy typically pay for?

Hospital room and board Signup and view all the answers

Which service is NOT covered under a hospitalization expense policy?

Surgeon's fees Signup and view all the answers

How much will Q be responsible for paying on a claim amounting to $10,100 with a $100 deductible and 80/20 coinsurance?

2100 Signup and view all the answers

What is the purpose of deductibles in health policies?

To lower overuse of medical services Signup and view all the answers

What does the Carryover provision allow in health insurance?

Permits expenses incurred during the last three months of the calendar year to carry over Signup and view all the answers

Which health insurance coverage is BEST suited for catastrophic illness expenses?

Major Medical Signup and view all the answers

What is the intent of a Stop Loss provision in Major Medical Expense policies?

Limits an insured's out-of-pocket medical expenses Signup and view all the answers

Under a Health Reimbursement Arrangement (HRA), reimbursements may be tax-free.

True Signup and view all the answers

Which medical expense is NOT covered by Cancer insurance?

Arthritis Signup and view all the answers

How will the insurer likely consider a condition treated prior to applying for a health insurance policy?

As a pre-existing condition which may not be covered for one year Signup and view all the answers

What is an example of an internal limit in health insurance?

This policy will only pay for a semi-private room Signup and view all the answers

What type of policy provides coverage only for specific illnesses like cancer or stroke?

Dread disease insurance Signup and view all the answers

How much maximum will C pay if the covered medical expenses are $2,000 with an 80/20 coinsurance clause and a $400 deductible?

720 Signup and view all the answers

Which of the following healthcare services is typically NOT covered?

Experimental treatments Signup and view all the answers

Which of these expenses can an individual use their medical flexible spending account to pay for?

Prescription drugs Signup and view all the answers

Which situation does a Critical Illness plan cover?

Leukemia Signup and view all the answers

Which statement is NOT true regarding health insurance policies?

Health insurance covers all types of medical services Signup and view all the answers

What is the amount M will receive in payment for a $2,200 claim with a $200 flat deductible and an 80% Coinsurance clause?

1600 Signup and view all the answers

Which individual health insurance policy provides the broadest protection?

Major Medical Signup and view all the answers

What is a characteristic of Preferred Provider Organizations (PPOs)?

Discounted fees for the patient Signup and view all the answers

Basic Medical Expense insurance has lower benefit limits than which type of insurance?

Major Medical insurance Signup and view all the answers

Which types of health coverage frequently use a deductible?

Major Medical policy Signup and view all the answers

How is M's claim eligibility determined under a basic Hospital/Surgical Expense policy?

Determined by the terms of the policy Signup and view all the answers

What describes dental care indemnity coverage?

Services are reimbursed after insurer receives the invoice Signup and view all the answers

What is the first portion of a covered Major Medical insurance expense that the insured must pay called?

Initial deductible Signup and view all the answers

What must the Health Reimbursement Arrangement (HRA) be established by?

The employer Signup and view all the answers

Study Notes

Major Medical Insurance Basics

An insured with a $1,000 deductible and an 80/20 coinsurance on $11,000 in expenses is responsible for a total of $3,000.
Major Medical policies typically include both a deductible and coinsurance provisions.

Coverage and Policies

Basic Hospital/Surgical policies usually cover expenses like the surgical removal of a facial birthmark.
Health Reimbursement Arrangements (HRA) are employer-funded and must be established by the employer, contrary to being funded by employees.

Cost Structures

Usual, customary, and reasonable (UCR) charges are defined as the maximum allowance for reimbursement by insurers.
Deductibles in health policies serve to limit overutilization of services.

Claims and Payments

An individual with an 80/20 coinsurance and a $2,000 deductible incurs $10,000 in medical expenses, resulting in $3,600 paid out-of-pocket.
Upon incurring $15,000 in expenses with a $5,000 deductible, the insured pays $7,000.

Specific Provisions

Coinsurance in Major Medical policies is designed to discourage excessive use of coverage.
The Stop Loss provision limits an insured's total out-of-pocket expenses.

Defined Health Coverage Types

Major Medical insurance is best for catastrophic illness expenses due to its broad coverage.
Dread Disease Insurance offers coverage for specific illnesses such as cancer and stroke.

Policy Limits and Exclusions

Basic Hospital/Surgical policies offer lower benefits compared to Major Medical coverage, and they are limited in terms of expenses.
Health care services that are experimental or investigative are typically not covered under comprehensive Major Medical policies.

Flexible Spending Accounts

Medical flexible spending accounts can be used to cover expenses such as prescription drugs.
Health Savings Accounts require enrollment in a high-deductible health plan (HDHP).

Indemnity and Coverage Terms

Dental care indemnity plans reimburse after the receipt of invoices for services.
Basic Medical Expense insurance provides limited benefits less than those of Major Medical insurance.

Claims Determination

Claims under basic Hospital/Surgical policies are determined by the specific policy terms.
A Major Medical policy's first portion of a covered expense that the insured must pay is known as the initial deductible.

Exclusions in Coverage

Life insurance policies are considered not limited benefit plans, unlike policies for specific health issues (e.g., cancer).
Cancer insurance does not cover conditions unrelated to cancer, such as arthritis.

Costs Associated with Hospitalization

Major Medical policies will cover hospitalization expenses, with an example showing a total responsibility of $2,100 after applying deductibles and coinsurance.

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Description

Test your knowledge on Major Medical plans with these flashcards. Discover how deductibles and coinsurance affect the financial responsibilities of insured individuals. This quiz aims to reinforce understanding of key concepts in medical expense insurance.

Medical Expense Insurance Flashcards

Questions and Answers

How much will the insured be responsible to pay with $11,000 in covered medical expenses assuming a $1,000 deductible and an 80/20 Coinsurance clause?

Which of the following costs would a Basic Hospital/Surgical policy likely cover?

Which of these is NOT a characteristic of a Health Reimbursement Arrangement (HRA)?

Which of the following phrases refers to the fees charged by a healthcare professional?

If J is hospitalized and receives a bill for $10,000, how much would J pay with a $2,000 deductible and an 80/20 Coinsurance clause?

Which statement BEST describes the intent of a Coinsurance clause in a Major Medical policy?

To qualify for a tax-exempt Health Savings Account, what must the individual be enrolled in?

Major Medical policies typically contain a deductible and coinsurance.

What BEST describes a Hospital Indemnity policy?

What defines usual, customary, and reasonable (UCR) charges?

Basic Hospital and Surgical policy benefits are lower than the actual expenses incurred.

How much will the insured have to pay if $15,000 in covered medical expenses are incurred with a $5,000 deductible and an 80/20 Coinsurance clause?

What would be this family's out-of-pocket medical expenses for 2013 if their Hospital/Surgical Expense policy was issued with a $500 deductible and a limit of four deductibles per calendar year?

In order to establish a Health Reimbursement Arrangement (HRA), it must be established by whom?

All of the following statements about Major Medical benefits are true EXCEPT

What does a major medical policy typically provide?

What do comprehensive Major Medical policies usually combine?

In the case of a heart condition that was concealed on an insurance application, what is likely to occur when a claim is submitted?

All of the following are limited benefit plans EXCEPT

What does a Basic Medical Expense policy cover in terms of hospitalization?

Match the following health coverage types with their descriptions:

What is the provision in a Major Medical policy that requires the insured to pay part of the costs?

What does a Basic Hospital policy typically pay for?

Which service is NOT covered under a hospitalization expense policy?

How much will Q be responsible for paying on a claim amounting to $10,100 with a $100 deductible and 80/20 coinsurance?

What is the purpose of deductibles in health policies?

What does the Carryover provision allow in health insurance?

Which health insurance coverage is BEST suited for catastrophic illness expenses?

What is the intent of a Stop Loss provision in Major Medical Expense policies?

Under a Health Reimbursement Arrangement (HRA), reimbursements may be tax-free.

Which medical expense is NOT covered by Cancer insurance?

How will the insurer likely consider a condition treated prior to applying for a health insurance policy?

What is an example of an internal limit in health insurance?

What type of policy provides coverage only for specific illnesses like cancer or stroke?

How much maximum will C pay if the covered medical expenses are $2,000 with an 80/20 coinsurance clause and a $400 deductible?

Which of the following healthcare services is typically NOT covered?

Which of these expenses can an individual use their medical flexible spending account to pay for?

Which situation does a Critical Illness plan cover?

Which statement is NOT true regarding health insurance policies?

What is the amount M will receive in payment for a $2,200 claim with a $200 flat deductible and an 80% Coinsurance clause?

Which individual health insurance policy provides the broadest protection?

What is a characteristic of Preferred Provider Organizations (PPOs)?

Basic Medical Expense insurance has lower benefit limits than which type of insurance?

Which types of health coverage frequently use a deductible?

How is M's claim eligibility determined under a basic Hospital/Surgical Expense policy?

What describes dental care indemnity coverage?

What is the first portion of a covered Major Medical insurance expense that the insured must pay called?

What must the Health Reimbursement Arrangement (HRA) be established by?

Study Notes

Major Medical Insurance Basics

Coverage and Policies

Cost Structures

Claims and Payments

Specific Provisions

Defined Health Coverage Types

Policy Limits and Exclusions

Flexible Spending Accounts

Indemnity and Coverage Terms

Claims Determination

Exclusions in Coverage

Costs Associated with Hospitalization

Studying That Suits You

Description

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