Medical Expense Insurance Flashcards

Questions and Answers

Which policy feature allows an insured to defer current health charges to the following year's deductible instead of the current year's deductible?

Annual limit

Exclusion clause

Waiting period

Carryover provision (correct)

Who must establish a Health Reimbursement Arrangement?

by the employer

What determines the claim M is eligible for under a basic Hospital/Surgical Expense policy?

determined by terms of the policy

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

Employee funds the HRA entirely Signup and view all the answers

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

$2,100 Signup and view all the answers

What will the insurance company do if it discovers a pre-existing condition after issuing a policy?

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

What is correct about Health Reimbursement Arrangements (HRA)?

If the employee paid for qualified medical expenses, the reimbursements may be tax-free Signup and view all the answers

What is the MAXIMUM amount C will pay for $2,000 in covered medical expenses with 80/20 coinsurance and a $400 deductible?

$720 Signup and view all the answers

How will the insurer likely consider an ailment treated 2 months prior to applying for a health insurance policy?

Insurer will likely treat as a pre-existing condition which may not be covered for one year Signup and view all the answers

For which of the following expenses does a Basic Hospital policy pay?

Hospital room and board Signup and view all the answers

What type of policy provides coverage for specific types of illnesses?

Dread disease insurance Signup and view all the answers

What do usual, customary, and reasonable (UCR) charges represent?

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

Which health care services are typically covered by a comprehensive major medical health insurance policy?

Nursing services Signup and view all the answers

What are the out-of-pocket medical expenses for a family with a Hospital/Surgical Expense policy that has a $500 deductible and four deductible limit in 2013?

$1,000 Signup and view all the answers

What do Major Medical policies typically contain?

contain a deductible and coinsurance 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 BEST describes a Hospital Indemnity policy?

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

Which of the following situations does a Critical Illness plan cover?

Leukemia Signup and view all the answers

If M incurs a $2,200 claim under a Major Medical insurance policy with a $200 deductible and an 80% coinsurance clause, how much will M receive?

$1,600 Signup and view all the answers

Study Notes

Medical Expense Insurance Key Concepts

Carryover Provision: Allows insured to defer health charges to the next year's deductible.
Health Reimbursement Arrangement (HRA): Must be established by the employer for employee reimbursement of medical expenses.
Claim Determination: For basic Hospital/Surgical Expense policies, reimbursement eligibility is dictated by policy terms.
HRA Characteristics: Employees do not fund the HRA entirely; it is funded entirely by the employer. HRAs can accompany other health plans and reimburse eligible medical expenses.
Major Medical Policy: In a hospitalization case with a bill of $10,100, after a $100 deductible and 80/20 coinsurance, out-of-pocket expenses total $2,100.
Pre-existing Condition: If a concealed pre-existing heart condition is discovered after policy issuance, the insurer will continue coverage but exclude that specific condition.
Tax-Free Reimbursement: Reimbursements for qualified medical expenses paid by employees under an HRA may be tax-free.
Maximum Payment Calculation: For a Major Medical policy with 80/20 coinsurance and a $400 deductible on a $2,000 medical claim, the maximum amount payable is $720.
Pre-existing Conditions: Illnesses noted on an application can be treated as pre-existing conditions, potentially excluded from coverage for one year.
Basic Hospital Policy: Typically covers hospital room and board expenses.
Dread Disease Insurance: Offers coverage exclusively for specific illnesses, such as cancer and stroke.
Usual, Customary, and Reasonable (UCR) Charges: Represents the maximum amount eligible for reimbursement under a health plan.
Eligible Expenses: A comprehensive major medical policy excludes experimental and investigative services while covering hospital charges, physician fees, and nursing services.
Out-of-Pocket Expenses: A family with a Hospital/Surgical Expense policy that incurs two claims within a calendar year may face $1,000 in out-of-pocket expenses if each claim exceeds the deductible.
Major Medical Policies: Generally involve a deductible and coinsurance structure.
Catastrophic Illness Coverage: Major Medical insurance is best suited to cover expenses from catastrophic illnesses.
Hospital Indemnity Policy: Provides a daily cash benefit for covered hospitalization.
Critical Illness Plan Coverage: Specifically covers severe conditions such as leukemia, while other conditions like asthma and alcohol rehabilitation typically are not included.
Payment Calculation for Claims: For a Major Medical policy with a $200 deductible and 80% coinsurance on a $2,200 medical claim, payment received would be $1,600 after deductibles and coinsurance.

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Description

Test your knowledge of medical expense insurance with these flashcards. This quiz covers key features and provisions, such as carryover provisions and the establishment of Health Reimbursement Arrangements. Perfect for students and professionals in the healthcare insurance field.