Life & Health Insurance Exam Prep with precise detailed
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answers
Basic |Medical |Expense |policies |- |correct |answer |Provide |coverage |for |Hospital, |Surgical |and |
Physicians |Medical |Expense. |
-Purchased |as |a |individual |or |group |policy.
-provide |first |dollar |coverage |(no |deductibles).
-limited |benefit |periods |and |low |coverage |limits.
Major |Medical |Expense |Policy |- |correct |answer |-A |supplement |(in |addition) |to |Basic |Medical |
or |as |a |stand-alone |policy. |
-individual |or |group |policy.
-Take |over |when |the |Basic |Policy |runs |out
Hospital |Expenses |- |correct |answer |-Pay |for |covered |expenses |incurred |during |a |hospital |stay. |
1. |Daily |hospital |benefit |- |Room |and |Board |
2. |Miscellaneous |expenses |- |Other |Medical |Expenses |(X-Rays, |MRI, |Prescriptions, |Doctor |Visits)
Daily |Hospital |Benefit |- |correct |answer |-Cost |of |a |hospital |room, |up |to |a |daily |$ |limit. |The |limit
|may |be |expressed |either |as |a |dollar |amount, |e.g. |$500 |per |day, |or |it |may |be |expressed |as |the
|Usual, |Customary |and |Reasonable |(UCR) |and |Charge
Usual, |Customary |and |Reasonable |(UCR) |- |correct |answer |Insurance |company |will |pay |an |
amount |for |a |given |procedure |based |upon |the |average |charge |for |that |procedure |in |that |
specific |geographic |area. |The |coverage |is |subject |to |a |maximum |amount |or |number |of |days.
Benefit |Schedule |- |correct |answer |-Specifically |states |what |is |covered |in |the |plan |and |for |how |
much. |The |coverage |is |subject |to |a |maximum |amount |or |number |of |days.
,Indemnity |- |correct |answer |Insured |pays |the |bill |and |is |reimbursed |by |the |insurance |company |
up |to |a |specified |limit |amount. |Medical |expense |policies |that |pay |a |fixed |rate |provide |the |
insured |with |a |stated |benefit |amount |for |each |day |of |hospital |confinement.
Reimbursement |- |correct |answer |Policyowners |obtain |medical |treatment |from |whatever |
source |they |want |and |submit |their |charges |to |their |insurer |for |reimbursement |(actual |
amount).
Service |Based |Contracts |- |correct |answer |-Pay |doctors |and |hospitals |directly |according |to |the |#
|of |days |of |coverage |that |is |provided |in |the |contract |for |each |event |and |are |prepayment |plans.
|Once |a |claim |is |settled, |the |insured |will |receive |an |Explanation |of |Benefit |(EOB), |which |is |a |
written |confirmation |that |the |claim |was |paid. |Blue |Cross |and |Blue |Shield, |Health |Service |
Corporations |and |Medicare |coverage |are |all |provided |on |a |Service |Basis.
Miscellaneous |Expense |Benefits |- |correct |answer |-Secondary |benefits |(inside |benefits) |because
|they |occur |inside |the |hospital |for |charges |related |to |the |stay. |X-rays, |prescriptions, |MRI's, |
anesthesia |and |lab |fees |are |usually |separate |fees |incurred |during |a |stay. |Miscellaneous |
Expense |Benefits |have |separate |limits, |referred |to |as |Inside |Limits. |The |are |expressed |usually |
as |a |multiple |of |the |daily |amount |(UCR)
Surgical |Expense |- |correct |answer |A |schedule |of |procedures |lists |the |amount |allowable |for |
each |procedure. |If |a |surgical |procedure |is |not |found |in |the |schedule, |it |will |still |be |payable. |
The |amount |payable |for |a |procedure |not |listed |is |based |on |its |relative |value |to |a |procedure |of
|similar |difficulty. |There |are |usually |no |deductibles.
Surgical |Schedule |- |correct |answer |Is |simply |a |price |list. |Each |procedure |is |listed |and |a |dollar |
amount |assigned |and |if |a |procedure |is |not |listed |in |the |schedule |it |is |still |paid.
Relative |Value |- |correct |answer |scientific |method |of |paying |different |benefits |based |on |the |
region |of |the |country |an |insured |lives. |It |is |based |on |assigning |a |value |to |each |procedure |and |
using |a |conversion |factor. |A |schedule |of |assigned |points |for |each |procedure |must |be |included |
in |the |policy.
, Physicians |Medical |Expense |- |correct |answer |Pays |for |visits |to |the |doctor |(office |hospital) |plus |
post |operation |care. |There |may |be |a |per-visit |benefit, |or |the |coverage |is |based |on |UCR. |
-May |or |may |not |be |a |deductible |. |This |policy |is |usually |written |as |an |indemnity |plan |and |has |
first |dollar |coverage |(no |deductible). |
-usually |written |as |an |indemnity |plan |and |has |first |dollar |coverage
Major |Medical |Expense |- |correct |answer |-Cover |"catastrophic" |or |huge |loss. |A |Catastrophic |
loss |is |defined |as |whenever |Basic |coverage |runs |out |and |not |a |specific |dollar |amount.
-High |Maximum |Limits |($2,000,000) |
-Deductibles |(per |person |or |per |family |ea |yr)) |
-Co- |insurance |(Usually |80/20%) |
-Stop |Loss
-Miscellaneous |Expense |Benefits |- |x-rays, |MRI, |lab |tests, |etc.
Coinsurance |- |correct |answer |- |Once |the |deductible |is |met |the |insured |and |the |insurance |
company |share |in |the |expenses |in |what |is |called |coinsurance. |It |is |written |as |80/20, |70/30, |
etc. |Also |called |percentage |participation |requirement.
Flat |Deductible |- |correct |answer |-Portion |of |medical |expenses |that |are |paid |by |the |insured |
each |year |before |benefits |start. |The |higher |the |deductible |the |lower |the |annual |premium |will |
be. |
-If |a |medical |incident |occurs |in |the |last |three |months |of |any |plan |year |and |the |annual |
deductible |has |met |the |yearly |requirement |then |the |medical |treatment |for |that |incident |only |
would |be |covered |in |the |new |plan |year. |Thus |a |"carryover" |into |the |next |year |of |the |paid |
deductible |has |occurred.
Per |Cause |Deductible |- |correct |answer |A |separate |deductible |for |each |separate |illness |or |
accident.
Stop |Loss |- |correct |answer |Max |amount |the |insured |is |required |to |pay |out |of |pocket: |After |the
|stop |loss |amount |is |reached |by |the |insured, |in |a |calendar |year, |the |company |will |pay |100% |of |
the |remaining |covered |expenses. |
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answers
Basic |Medical |Expense |policies |- |correct |answer |Provide |coverage |for |Hospital, |Surgical |and |
Physicians |Medical |Expense. |
-Purchased |as |a |individual |or |group |policy.
-provide |first |dollar |coverage |(no |deductibles).
-limited |benefit |periods |and |low |coverage |limits.
Major |Medical |Expense |Policy |- |correct |answer |-A |supplement |(in |addition) |to |Basic |Medical |
or |as |a |stand-alone |policy. |
-individual |or |group |policy.
-Take |over |when |the |Basic |Policy |runs |out
Hospital |Expenses |- |correct |answer |-Pay |for |covered |expenses |incurred |during |a |hospital |stay. |
1. |Daily |hospital |benefit |- |Room |and |Board |
2. |Miscellaneous |expenses |- |Other |Medical |Expenses |(X-Rays, |MRI, |Prescriptions, |Doctor |Visits)
Daily |Hospital |Benefit |- |correct |answer |-Cost |of |a |hospital |room, |up |to |a |daily |$ |limit. |The |limit
|may |be |expressed |either |as |a |dollar |amount, |e.g. |$500 |per |day, |or |it |may |be |expressed |as |the
|Usual, |Customary |and |Reasonable |(UCR) |and |Charge
Usual, |Customary |and |Reasonable |(UCR) |- |correct |answer |Insurance |company |will |pay |an |
amount |for |a |given |procedure |based |upon |the |average |charge |for |that |procedure |in |that |
specific |geographic |area. |The |coverage |is |subject |to |a |maximum |amount |or |number |of |days.
Benefit |Schedule |- |correct |answer |-Specifically |states |what |is |covered |in |the |plan |and |for |how |
much. |The |coverage |is |subject |to |a |maximum |amount |or |number |of |days.
,Indemnity |- |correct |answer |Insured |pays |the |bill |and |is |reimbursed |by |the |insurance |company |
up |to |a |specified |limit |amount. |Medical |expense |policies |that |pay |a |fixed |rate |provide |the |
insured |with |a |stated |benefit |amount |for |each |day |of |hospital |confinement.
Reimbursement |- |correct |answer |Policyowners |obtain |medical |treatment |from |whatever |
source |they |want |and |submit |their |charges |to |their |insurer |for |reimbursement |(actual |
amount).
Service |Based |Contracts |- |correct |answer |-Pay |doctors |and |hospitals |directly |according |to |the |#
|of |days |of |coverage |that |is |provided |in |the |contract |for |each |event |and |are |prepayment |plans.
|Once |a |claim |is |settled, |the |insured |will |receive |an |Explanation |of |Benefit |(EOB), |which |is |a |
written |confirmation |that |the |claim |was |paid. |Blue |Cross |and |Blue |Shield, |Health |Service |
Corporations |and |Medicare |coverage |are |all |provided |on |a |Service |Basis.
Miscellaneous |Expense |Benefits |- |correct |answer |-Secondary |benefits |(inside |benefits) |because
|they |occur |inside |the |hospital |for |charges |related |to |the |stay. |X-rays, |prescriptions, |MRI's, |
anesthesia |and |lab |fees |are |usually |separate |fees |incurred |during |a |stay. |Miscellaneous |
Expense |Benefits |have |separate |limits, |referred |to |as |Inside |Limits. |The |are |expressed |usually |
as |a |multiple |of |the |daily |amount |(UCR)
Surgical |Expense |- |correct |answer |A |schedule |of |procedures |lists |the |amount |allowable |for |
each |procedure. |If |a |surgical |procedure |is |not |found |in |the |schedule, |it |will |still |be |payable. |
The |amount |payable |for |a |procedure |not |listed |is |based |on |its |relative |value |to |a |procedure |of
|similar |difficulty. |There |are |usually |no |deductibles.
Surgical |Schedule |- |correct |answer |Is |simply |a |price |list. |Each |procedure |is |listed |and |a |dollar |
amount |assigned |and |if |a |procedure |is |not |listed |in |the |schedule |it |is |still |paid.
Relative |Value |- |correct |answer |scientific |method |of |paying |different |benefits |based |on |the |
region |of |the |country |an |insured |lives. |It |is |based |on |assigning |a |value |to |each |procedure |and |
using |a |conversion |factor. |A |schedule |of |assigned |points |for |each |procedure |must |be |included |
in |the |policy.
, Physicians |Medical |Expense |- |correct |answer |Pays |for |visits |to |the |doctor |(office |hospital) |plus |
post |operation |care. |There |may |be |a |per-visit |benefit, |or |the |coverage |is |based |on |UCR. |
-May |or |may |not |be |a |deductible |. |This |policy |is |usually |written |as |an |indemnity |plan |and |has |
first |dollar |coverage |(no |deductible). |
-usually |written |as |an |indemnity |plan |and |has |first |dollar |coverage
Major |Medical |Expense |- |correct |answer |-Cover |"catastrophic" |or |huge |loss. |A |Catastrophic |
loss |is |defined |as |whenever |Basic |coverage |runs |out |and |not |a |specific |dollar |amount.
-High |Maximum |Limits |($2,000,000) |
-Deductibles |(per |person |or |per |family |ea |yr)) |
-Co- |insurance |(Usually |80/20%) |
-Stop |Loss
-Miscellaneous |Expense |Benefits |- |x-rays, |MRI, |lab |tests, |etc.
Coinsurance |- |correct |answer |- |Once |the |deductible |is |met |the |insured |and |the |insurance |
company |share |in |the |expenses |in |what |is |called |coinsurance. |It |is |written |as |80/20, |70/30, |
etc. |Also |called |percentage |participation |requirement.
Flat |Deductible |- |correct |answer |-Portion |of |medical |expenses |that |are |paid |by |the |insured |
each |year |before |benefits |start. |The |higher |the |deductible |the |lower |the |annual |premium |will |
be. |
-If |a |medical |incident |occurs |in |the |last |three |months |of |any |plan |year |and |the |annual |
deductible |has |met |the |yearly |requirement |then |the |medical |treatment |for |that |incident |only |
would |be |covered |in |the |new |plan |year. |Thus |a |"carryover" |into |the |next |year |of |the |paid |
deductible |has |occurred.
Per |Cause |Deductible |- |correct |answer |A |separate |deductible |for |each |separate |illness |or |
accident.
Stop |Loss |- |correct |answer |Max |amount |the |insured |is |required |to |pay |out |of |pocket: |After |the
|stop |loss |amount |is |reached |by |the |insured, |in |a |calendar |year, |the |company |will |pay |100% |of |
the |remaining |covered |expenses. |
