MN State Health Insurance Exam Questions With 100% Correct Answers.

Information about Health Maintenance Organizations (HMOs) - -Employers with more than 25 employees must offer an HMO as an alternative to their regular health plans. -Reduce cost of healthcare through preventative care -Needs to be approved by MN DHS -Provides services rather than reimbursement -Limited service area and providers -Prepaid basis, physicians paid per head of member (capation) -INPATIENT HOSPITAL CARE IN OR OUT NETWORK Preferred Provider Organization (PPO) - -Physicians paid fees for their services and are not salaried. -Contract with employers, insurers, or third parties to provide medical care at a reduced fee. -In network but members don't have to use the network. -Don't have to select a primary care physician. -Copays and coinsurance will be higher for care out of network. Point of Service (POS) - -A combination of HMOs and PPOs. -Employees not locked into one plan or have to make a choice between two plans. -Choices can be made based on need. -Copays and coinsurance will be higher for care out of network. Cafeteria Plan - type of employee benefit plan that allows insureds to choose between different types of benefits Flexible Health Spending Accounts (FSAs) - -A form of cafeteria plan benefit funded by salary reduction and employer contributions. -Employees can deposit a certain amount of their paycheck into an account PRE TAX. -Subject to annual maximum and "use or lose" rule.-Exempt from federal income taxes, Social Security taxes, and sometimes state income taxes. Health Reimbursement Account (HRA) - -Consist of funds set aside by employers to reimburse employees for qualified medical expenses, such as deductibles or coinsurance amounts. -Employers can deduct the cost of a HRA as a business expense. -Not taxable employee benefit -Unused funds roll over -Open to companies of all sizes, employer determines eligibility and contribution limits. -Go along with a high deductible health plan for people under 30. Presumptive Disability - -A provision that is found in most disability income policies which specifies the conditions that will automatically qualify the insured for full disability benefits. -Most commonly includes dismemberment (loss of two or more limbs, total and permanent blindness, loss of speech or hearing. Recurrent Disability - -Generally specifies the period of time (normally 4-6 months) during which the recurrence of an injury or illness will be considered as a continuation of a prior period of disability. Elimination Period - A waiting period that is imposed on the insured from the onset of disability until benefit payments begin, measured in days. The longer the E. period, the lower the premium cost. Probationary Period - The period of time between the effective date of a health insurance policy and the date coverage for all or certain conditions begins. Applies to sickness and not accidents or injury. -Prevents those with or developing a disability from immediately using the benefit. Benefit Period - Length of time during which benefits are paid after the elimination period has been satisfied. 1 year, 2 years, 5 years and to age 65 are common benefit offerings. The longer the benefit period, the higher the premium. Group Disability Income Policy (differences from individual plans) - -Group plans usually specify the benefits based on a percentage of the worker's income. Individual is normally a flat amount.-Minimum participation requirements, must have worked 30 to 90 days before to be eligible for coverage. Group Short Term Disability Benefit Period - 13 to 26 weeks. Individual Short Term Disability Benefit Period - 6 months to 2 years.