Medical Expense Insurance UPDATED
Exam Questions and CORRECT Answers
Which of the following policy features allows an insured to defer current health charges to
the following year's deductible instead of the current year's deducitble? - Correct Answer-
Carryover provision
A Health Reimbursement Arrangement MUST be established - Correct Answer- by the
employer
M is insured under a basic Hospital/Surgical Expense policy. A physician performs surgery
on M. What determines the claim M is eligible for? - Correct Answer- determined by terms of
the policy
Which of these is NOT a characteristic of a Health Reimbursement Arrangement (HRA)?
Employee funds the HRA entirely
Employer funds the HRA entirely
HRA's can be offered with other health plans
HRA's allow reimbursement for eligible medical expenses - Correct Answer- Employee
funds the HRA entirely
Q is hospitalized for 3 days and receives a bill for $10,100. Q has a Major Medical policy
with a $100 deductible and 80/20 coinsurance. How much will Q be responsible for paying
on this claim? - Correct Answer- $2,100
A prospective insured completes and signs an application for health insurance but
intentionally conceals information about a pre-existing heart condition. The company issues
the policy. Two months later, the insured suffers a heart attack and submits a claim. While
processing the claim, the company discovers the pre-existing condition. In this situation, the
company will - Correct Answer- continue coverage but exclude the heart condition
Which of the following statements about Health Reimbursement Arrangements (HRA) is
CORRECT? - Correct Answer- If the employee paid for qualified medical expenses, the
reimbursements may be tax-free
, C was injured while deep sea diving and requires a hospital stay. C has a Major Medical
policy with a 80/20 coinsurance clause and a $400 deductible. What is the MAXIMUM C
will pay if the covered medical expenses are $2000? - Correct Answer- $720 In this situation,
$400 deductible + 20% of the remaining medical bill = $720.
T was treated for an ailment 2 months prior to applying for a health insurance policy. This
condition was noted on the application and the policy was issued shortly afterwards.How will
the insurer likely consider this condition? - Correct Answer- Insurer will likely treat as a pre-
existing condition which may not be covered for one year
For which of the following expenses does a Basic Hospital policy pay? - Correct Answer-
Hospital room and board
What type of policy would only provide coverage for specific types of illnesses (cancer,
stroke, etc)? - Correct Answer- Dread disease insurance
Which of the following statements BEST defines usual, customary, and reasonable (UCR)
charges? - Correct Answer- The maximum amount considered eligible for reimbursement by
an insurance company under a health plan
A comprehensive major medical health insurance policy contains an Eligible Expenses
provision which identifies the types of health care services that are covered. All of the
following health care services are typically covered EXCEPT for
hospital charges
physician fees
experimental and investigative services
nursing services - Correct Answer- experimental and investigative services
A Hospital/Surgical Expense policy was purchased for a family of four in March of 2013.
The policy was issued with a $500 deductible and a limit of four deductibles per calendar
year. Two claims were paid in September 2013, each incurring medical expenses in excess of
the deductible. Two additional claims were filed in 2014, each in excess of the deductible
amount as well. What would be this family's out-of-pocket medical expenses for 2013? -
Correct Answer- $1,000
Exam Questions and CORRECT Answers
Which of the following policy features allows an insured to defer current health charges to
the following year's deductible instead of the current year's deducitble? - Correct Answer-
Carryover provision
A Health Reimbursement Arrangement MUST be established - Correct Answer- by the
employer
M is insured under a basic Hospital/Surgical Expense policy. A physician performs surgery
on M. What determines the claim M is eligible for? - Correct Answer- determined by terms of
the policy
Which of these is NOT a characteristic of a Health Reimbursement Arrangement (HRA)?
Employee funds the HRA entirely
Employer funds the HRA entirely
HRA's can be offered with other health plans
HRA's allow reimbursement for eligible medical expenses - Correct Answer- Employee
funds the HRA entirely
Q is hospitalized for 3 days and receives a bill for $10,100. Q has a Major Medical policy
with a $100 deductible and 80/20 coinsurance. How much will Q be responsible for paying
on this claim? - Correct Answer- $2,100
A prospective insured completes and signs an application for health insurance but
intentionally conceals information about a pre-existing heart condition. The company issues
the policy. Two months later, the insured suffers a heart attack and submits a claim. While
processing the claim, the company discovers the pre-existing condition. In this situation, the
company will - Correct Answer- continue coverage but exclude the heart condition
Which of the following statements about Health Reimbursement Arrangements (HRA) is
CORRECT? - Correct Answer- If the employee paid for qualified medical expenses, the
reimbursements may be tax-free
, C was injured while deep sea diving and requires a hospital stay. C has a Major Medical
policy with a 80/20 coinsurance clause and a $400 deductible. What is the MAXIMUM C
will pay if the covered medical expenses are $2000? - Correct Answer- $720 In this situation,
$400 deductible + 20% of the remaining medical bill = $720.
T was treated for an ailment 2 months prior to applying for a health insurance policy. This
condition was noted on the application and the policy was issued shortly afterwards.How will
the insurer likely consider this condition? - Correct Answer- Insurer will likely treat as a pre-
existing condition which may not be covered for one year
For which of the following expenses does a Basic Hospital policy pay? - Correct Answer-
Hospital room and board
What type of policy would only provide coverage for specific types of illnesses (cancer,
stroke, etc)? - Correct Answer- Dread disease insurance
Which of the following statements BEST defines usual, customary, and reasonable (UCR)
charges? - Correct Answer- The maximum amount considered eligible for reimbursement by
an insurance company under a health plan
A comprehensive major medical health insurance policy contains an Eligible Expenses
provision which identifies the types of health care services that are covered. All of the
following health care services are typically covered EXCEPT for
hospital charges
physician fees
experimental and investigative services
nursing services - Correct Answer- experimental and investigative services
A Hospital/Surgical Expense policy was purchased for a family of four in March of 2013.
The policy was issued with a $500 deductible and a limit of four deductibles per calendar
year. Two claims were paid in September 2013, each incurring medical expenses in excess of
the deductible. Two additional claims were filed in 2014, each in excess of the deductible
amount as well. What would be this family's out-of-pocket medical expenses for 2013? -
Correct Answer- $1,000
