Question 1

Which statement is true?

Accepted Answer

A)  Spending for physicians' services in the U.S. has increased over time. 
B)  Spending for hospital services in the U.S. has increased over time. 
C)  Health care spending in the U.S. has increased over time. 
D)  All of the above 
A)  Spending for physicians' services in the U.S. has increased over time. 
B)  Spending for hospital services in the U.S. has increased over time. 
C)  Health care spending in the U.S. has increased over time. 
D)  All of the above

Question 2

Medicaid recipients must:

Accepted Answer

A)  wait six-months before they can enroll 
B)  provide a core requirement of minimum benefits 
C)  not have any pre-existing conditions 
D)  first spend all their financial assets 
A)  wait six-months before they can enroll 
B)  provide a core requirement of minimum benefits 
C)  not have any pre-existing conditions 
D)  first spend all their financial assets

Question 3

All of the following are individually-purchased health insurance products except:

Accepted Answer

A)  Medicaid insurance 
B)  long-term care insurance 
C)  basic medical insurance 
D)  major medical insurance 
A)  Medicaid insurance 
B)  long-term care insurance 
C)  basic medical insurance 
D)  major medical insurance

Question 4

Criticisms of the American health care system include all of the following except:

Accepted Answer

A)  waiting to repair the system will make cost control and universal access worse 
B)  the current system is more consistent with the American political philosophy than socialized medicine 
C)  Americans pay too much for health care 
D)  too many Americans do not have adequate access to health care 
A)  waiting to repair the system will make cost control and universal access worse 
B)  the current system is more consistent with the American political philosophy than socialized medicine 
C)  Americans pay too much for health care 
D)  too many Americans do not have adequate access to health care

Question 5

Major medical insurance has relatively large deductibles.

Accepted Answer

A) True 
 B)False

Question 6

Jean's health insurance policy has a 70/30 participation deductible. The policy has no other deductible provisions, nor does it have an annual out-of-pocket maximum limit. If Jean has brain transplant surgery that results in medical bills of $300,000, how much of the medical bills will her insurer pay?

Accepted Answer

A)  $210,000 
B)  $90,000 
C)  $300,000 
D)  cannot be determined from the given information 
A)  $210,000 
B)  $90,000 
C)  $300,000 
D)  cannot be determined from the given information

Question 7

The term "PPO" means:

Accepted Answer

A)  Preferred Participation Organization 
B)  Participating Physician Organization 
C)  Physicians' Participation Organization 
D)  Preferred Provider Organization 
A)  Preferred Participation Organization 
B)  Participating Physician Organization 
C)  Physicians' Participation Organization 
D)  Preferred Provider Organization

Question 8

Distinguish between a guaranteed renewable and a noncancellable health insurance contract.

Accepted Answer

A guaranteed renewable contract requires

Question 9

Which statement is false about the United States?

Accepted Answer

A)  Health care spending per capita in 2008 was $7,720. 
B)  The share of personal health spending associated with hospital services has increased since 2000. 
C)  The percentage of the U.S. population without health insurance was 19% in 2009. 
D)  The share of personal health spending growth associated with prescription drug spending has declined since 2000. 
A)  Health care spending per capita in 2008 was $7,720. 
B)  The share of personal health spending associated with hospital services has increased since 2000. 
C)  The percentage of the U.S. population without health insurance was 19% in 2009. 
D)  The share of personal health spending growth associated with prescription drug spending has declined since 2000.

Question 10

Insurers do not sell Medicaid policies; they are provided by the government.

Accepted Answer

A) True 
 B)False

Question 11

How does Blue Cross health insurance cover hospitalization?

Accepted Answer

A)  By covering a specific number of days in the hospital 
B)  It pays up to 80% of all usual and customary charges in a semi-private room 
C)  It pays a flat dollar amount per day of hospitalization, regardless of the actual charges incurred 
D)  Hospitalization coverage is not provided by Blue Cross policies 
A)  By covering a specific number of days in the hospital 
B)  It pays up to 80% of all usual and customary charges in a semi-private room 
C)  It pays a flat dollar amount per day of hospitalization, regardless of the actual charges incurred 
D)  Hospitalization coverage is not provided by Blue Cross policies

Question 12

A "guaranteed renewable" health insurance policy is also known as a "noncancellable" policy.

Accepted Answer

A) True 
 B)False

Question 13

Major medical insurance:

Accepted Answer

A)  always provides the same benefits as basic medical, but has higher limits 
B)  is designed for low income consumers 
C)  is sold only to groups 
D)  has a high limit of coverage 
A)  always provides the same benefits as basic medical, but has higher limits 
B)  is designed for low income consumers 
C)  is sold only to groups 
D)  has a high limit of coverage

Question 14

JoEllen has a major medical policy with a $500,000 lifetime aggregate limit, a $1,000 annual deductible and 80% coinsurance. Her health losses for the year include the following: hospital bills of $42,000; surgeon's fees of $14,000, prescription medication expenses of $5,000. How much will JoEllen's insurance pay for this loss?

Accepted Answer

A)  $48,000 
B)  $48,800 
C)  $60,000 
D)  $61,000 
A)  $48,000 
B)  $48,800 
C)  $60,000 
D)  $61,000

Question 15

More than half of all health insurance in the U.S. is provided by:

Accepted Answer

A)  Blue Cross Plans 
B)  Traditional Health Insurers 
C)  HMOs & PPOs 
D)  HMOs only 
A)  Blue Cross Plans 
B)  Traditional Health Insurers 
C)  HMOs & PPOs 
D)  HMOs only

Question 16

The strictest definition of "disability" used in disability insurance products is the:

Accepted Answer

A)  inability to engage in any occupation 
B)  inability to make the same income earned before the onset of the disability 
C)  inability to earn non-wage income 
D)  inability to engage in one's regular occupation 
A)  inability to engage in any occupation 
B)  inability to make the same income earned before the onset of the disability 
C)  inability to earn non-wage income 
D)  inability to engage in one's regular occupation

Question 17

The participation provision is generally associated with major medical insurance.

Accepted Answer

A) True 
 B)False

Question 18

The waiting period in disability income insurance:

Accepted Answer

A)  eliminates payment for minor illness 
B)  provides larger benefits to the insured 
C)  provides indirect loss coverage 
D)  integrates employment sick days with the disability plan 
A)  eliminates payment for minor illness 
B)  provides larger benefits to the insured 
C)  provides indirect loss coverage 
D)  integrates employment sick days with the disability plan

Question 19

Disability income insurance replaces income that cannot be earned while a person is disabled according to the contract's definition of disability.

Accepted Answer

A) True 
 B)False

Question 20

The preexisting condition clause in health insurance:

Accepted Answer

A)  makes a preexisting insurance contract pay for prior medical conditions 
B)  eliminates coverage for conditions that existed before the effective date of the current contract 
C)  coordinates the payment of already existing conditions among multiple policies 
D)  provides blanket coverage for preexisting conditions 
A)  makes a preexisting insurance contract pay for prior medical conditions 
B)  eliminates coverage for conditions that existed before the effective date of the current contract 
C)  coordinates the payment of already existing conditions among multiple policies 
D)  provides blanket coverage for preexisting conditions

Exam 18: Health Insurance and Disability Income

Which statement is true?

Medicaid recipients must:

All of the following are individually-purchased health insurance products except:

Criticisms of the American health care system include all of the following except:

Major medical insurance has relatively large deductibles.

The term "PPO" means:

Distinguish between a guaranteed renewable and a noncancellable health insurance contract.

Which statement is false about the United States?

Insurers do not sell Medicaid policies; they are provided by the government.

How does Blue Cross health insurance cover hospitalization?

A "guaranteed renewable" health insurance policy is also known as a "noncancellable" policy.

Major medical insurance:

More than half of all health insurance in the U.S. is provided by:

The strictest definition of "disability" used in disability insurance products is the:

The participation provision is generally associated with major medical insurance.

The waiting period in disability income insurance:

Disability income insurance replaces income that cannot be earned while a person is disabled according to the contract's definition of disability.

The preexisting condition clause in health insurance:

Introduction to Enterprise Risk Management and Insurance

Risk Identification

Risk Assessment and Pooling

Risk-Handling Techniques: Loss Control, Risk Transfer, and Loss Financing

Risk-Handling Techniques: Diversification and Hedging

Fundamentals of Insurance

Insurable Perils and Insuring Organizations

Insurance Functions

Insurance Markets: Economics and Issues

Insurance Regulation

Insurance Contracts

The Personal Auto Policy

Homeowners Insurance

Professional Financial Planning

Life Insurance Policies

Standard Life Insurance Contract Provisions and Options

Annuities

Employee Benefits

Social Security

Unemployment and Workers Compensation Insurance

Commercial Property Insurance

Commercial Liability Insurance

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