Test - GBA 1 - Practice Exam: Directing Benefits Programs Part 1Questions and Answers

Which risk-handling techniques are being used by a firm that decides to not produce a dangerous chemical, to purchase insurance with a $10,000 deductible on its assets and to install a fire sprinkler system throughout the plant? - Answer- Avoidance, retention, insurance and control Which of the following statements regarding prescription drug rebates is correct? - Answer- A rebate occurs when there is an agreement between a pharmacy benefit manager and a drug manufacturer. There are several methods for evaluating health system performance. Accreditation by the NCQA is an example of which of the following methods? - Answer- Audit performance evaluation When a participant of a cafeteria plan makes a one-time election on coverage that stays in force from plan year to plan year unless the participant elects to make a change during the applicable election period, it is referred to as a(n): - Answer- Evergreen election The benefit-oriented philosophy of designing employee benefits tends to focus on: - Answer- Needs of employees The amount of covered medical expenses that a participant must incur before any medical benefits for non-preventive care services or treatment become payable under a plan is known as the: - Answer- Deductible The Supreme Court decision in National Federation of Independent Business v. Sebelius had a profound effect on the implementation of the Affordable Care Act (ACA). Which of the following statements summarizes the impact of this case? - Answer- The decision made Medicare expansion by the states voluntary. The Affordable Care Act (ACA) aimed to make health insurance more affordable by providing tax credits to individuals ineligible for other affordable coverage and with income between which of the following limits: - Answer- 100% and 400% of the federal poverty line. The concept designed to make victims of losses whole again reflects the principle of: - Answer- Indemnification A mechanism by which one attempts either to prevent or reduce the probability of a loss taking place or to reduce the severity of the loss if it does take place is referred to as: - Answer- Control The Affordable Care Act (ACA), in general, defined a full-time employee as one employed on average at least how many hours per week? - Answer- 30 Dental treatments are placed into ten professional treatment categories. A restorative treatment is: - Answer- If a cafeteria plan fails to pass the required nondiscrimination testing, then: - Answer- The highly compensated and key employees are taxed based on the value of their benefits. An insured individual has $12,000 of covered medical expenses for in-network nonpreventive treatment. His plan is a high-deductible health policy with a $1,500 deductible and a 20% coinsurance arrangement. Also, the plan reimburses 100% after an individual reaches the plan's $6,000 out-of-pocket maximum. What will the insured pay out of the total medical expenses if this is the first claim of the plan year? - Answer- $ 3,600 A behavioral health care carve-out program usually operates under a separate contract and from a separate company known as a(n): - Answer- Managed behavioral health care organization (MBHO) A peril as the term applies to the insurance mechanism is defined as: - Answer- The cause of a loss The "managed care backlash" of the late 1990s gave direct rise to which of the following types of health care organizations? - Answer- Preferred provider organizations (PPOs) Which of the following is a requirement of the Health Insurance Portability and Accountability Act (HIPAA) as it applies to wellness programs? - Answer- A program that is offered directly by an employer outside of a group plan is not subject to HIPAA privacy rules. The maximum annual contribution that can be made to a health savings account (HSA) is: - Answer- A fixed, indexed amount Benefits for so-called lifestyle drugs: - Answer- Have been routinely excluded from all employer plans. A dental plan in which certain procedures are reimbursed on a scheduled basis and others are reimbursed on a nonscheduled basis is called a(n): - Answer- Combination plan A participant in a health care flexible spending account (FSA) elects to contribute $1,200 to the account for an entire plan year. One month into the year, $200 has been contributed to the account and the participant incurs $1,200 worth of eligible reimbursable expenses. Which of the following statements properly describes the maximum allowable claims and payments that can be made on the account? - Answer- A claim of $1,200 can be made on the account, and $1,200 will be paid. Generally in a premium conversion cafeteria plan: - Answer- There are no employer contributions. For a cafeteria plan to be afforded favorable tax treatment, the plan must allow participants to choose between how many benefits consisting of cash (or a taxable benefit that is treated as cash) and qualified benefits? - Answer- Two or more A health care plan has no restrictions on a member's choice of provider, there is no "steerage," and there is no basic utilization management. This type of health care coverage is known as: - Answer- Indemnity plan