Tennessee Health Insurance Exam Questions with Correct Answers Rated A+
Health Insurance - Answers Covers the risk of loss caused by a "living death"; after sustaining an
accidental injury or sickness, medical expenses must be paid in addition to the normal living expenses
Basic Types of Losses and Benefits for Health Insurance - Answers - Loss of income from disability
- Medical expense
- Dental expense
- Long-term care expense
Disability Income - Answers Occurs when an accidental injury or sickness prevents an insured from being
able to work; replaces income lost while the insured is unable to work; benefits are valued (a stated
amount) based on a % of the insured's lost income; only covers the insured
Medical Expense Insurance - Answers Covers the cost of medical treatments, physician's fees,
hospitalization, and other medical costs that ensue when the insured incurs an accidental injury or
sickness; may cover the insured and their dependents
Franchise Insurance - Answers Provides coverage for small groups that are not large enough to apply for
group coverage; each individual undergoes individual underwriting
Medicare - Answers Provides health insurance coverage for individuals over the age of 65; also covers
ESRD (renal failure) and Lou Gehrig's disease
Medicaid - Answers A state and federally funded medical assistance program for financially
disadvantaged individuals; welfare program operated by each individual state; covers for medical care
and services that Medicare only partially covers, including nursing home and home health care
TRICARE - Answers Provides health insurance coverage to active duty and retired members of the
uniformed services and their dependents; replaced CHAMPUS; 3 types of plans: prime (least costly;
organized like HMO), extra (receive medical care through a PPO arrangement), and standard (receive
medical care from any provider; more expensive).
Renewability Classes - Answers - Cancellable
- Optionally renewable
- Conditionally renewable
- Guaranteed renewable
- Non-cancellable
Factors Affecting Health Insurance Premiums - Answers - Interest
, - Expense
- Morbidity
- Benefits provided by the policy
Fee-for-service Basis - Answers Medical providers are paid for each service they provide and insureds
only pay for the medical services they use
Prepaid Basis - Answers Medical providers are compensated on a service basis rather than a dollar basis;
medical providers receive fixed compensation, regardless of how many patients they treat
Usual, Reasonable, and Customary Charge Method - Answers The insurer pays an amount for each
procedure or treatment based on the average charges in that geographic area
Insured - Answers The term refers to individuals who are covered by non-prepaid health plans
Subscriber (Participant/Member) - Answers The term refers to individuals who receive health insurance
benefits on prepaid or service plans
Examples of Limited Health Insurance Policies - Answers - AD&D
- Travel accident
- Hospital
- Income
- Credit health or disability
- Prescription
- Vision
- Dental
- Blanket coverage
- Dread disease (cancer, heart disease, stroke, blindness, MS, etc.)
Self-funded Employer Administered Plan - Answers The employer provides funding for claims payments
for its employees and their dependents; can be supplemented by a stop-loss contract so the employer's
liability is limited and an insurer will pay the claims in excess of the employer's expected claims
Administrator (TPA, ASO) - Answers Collects premiums; adjusts/settles claims of workers' compensation,
life or health coverage, or annuities; administers an internal service fund and trust; administers a
program of self-insurance for an employer; not used by a major insurance company
Health Insurance - Answers Covers the risk of loss caused by a "living death"; after sustaining an
accidental injury or sickness, medical expenses must be paid in addition to the normal living expenses
Basic Types of Losses and Benefits for Health Insurance - Answers - Loss of income from disability
- Medical expense
- Dental expense
- Long-term care expense
Disability Income - Answers Occurs when an accidental injury or sickness prevents an insured from being
able to work; replaces income lost while the insured is unable to work; benefits are valued (a stated
amount) based on a % of the insured's lost income; only covers the insured
Medical Expense Insurance - Answers Covers the cost of medical treatments, physician's fees,
hospitalization, and other medical costs that ensue when the insured incurs an accidental injury or
sickness; may cover the insured and their dependents
Franchise Insurance - Answers Provides coverage for small groups that are not large enough to apply for
group coverage; each individual undergoes individual underwriting
Medicare - Answers Provides health insurance coverage for individuals over the age of 65; also covers
ESRD (renal failure) and Lou Gehrig's disease
Medicaid - Answers A state and federally funded medical assistance program for financially
disadvantaged individuals; welfare program operated by each individual state; covers for medical care
and services that Medicare only partially covers, including nursing home and home health care
TRICARE - Answers Provides health insurance coverage to active duty and retired members of the
uniformed services and their dependents; replaced CHAMPUS; 3 types of plans: prime (least costly;
organized like HMO), extra (receive medical care through a PPO arrangement), and standard (receive
medical care from any provider; more expensive).
Renewability Classes - Answers - Cancellable
- Optionally renewable
- Conditionally renewable
- Guaranteed renewable
- Non-cancellable
Factors Affecting Health Insurance Premiums - Answers - Interest
, - Expense
- Morbidity
- Benefits provided by the policy
Fee-for-service Basis - Answers Medical providers are paid for each service they provide and insureds
only pay for the medical services they use
Prepaid Basis - Answers Medical providers are compensated on a service basis rather than a dollar basis;
medical providers receive fixed compensation, regardless of how many patients they treat
Usual, Reasonable, and Customary Charge Method - Answers The insurer pays an amount for each
procedure or treatment based on the average charges in that geographic area
Insured - Answers The term refers to individuals who are covered by non-prepaid health plans
Subscriber (Participant/Member) - Answers The term refers to individuals who receive health insurance
benefits on prepaid or service plans
Examples of Limited Health Insurance Policies - Answers - AD&D
- Travel accident
- Hospital
- Income
- Credit health or disability
- Prescription
- Vision
- Dental
- Blanket coverage
- Dread disease (cancer, heart disease, stroke, blindness, MS, etc.)
Self-funded Employer Administered Plan - Answers The employer provides funding for claims payments
for its employees and their dependents; can be supplemented by a stop-loss contract so the employer's
liability is limited and an insurer will pay the claims in excess of the employer's expected claims
Administrator (TPA, ASO) - Answers Collects premiums; adjusts/settles claims of workers' compensation,
life or health coverage, or annuities; administers an internal service fund and trust; administers a
program of self-insurance for an employer; not used by a major insurance company
