Question 1

This term refers to the percentage of the health bill the insured employee is required to pay.

Accepted Answer

A)   coinsurance
B)   co-admission
C)   co-premiums
D)   co-payment A

Question 2

Compare and contrast commercial insurance (fee-for-service)and self-funded insurance.

Accepted Answer

Although both plans specify areas of coverage,deductibles,and coinsurance rates,the major difference is in how benefits are financed.Commercial insurance companies pay benefits from their financial reserves that are based on the premiums companies and employees pay to receive insurance.With self-funding,companies will pay benefits directly from their own assets.Companies may choose to self-fund when a company's financial burden associated with covering medical expenses for its employees is less than the cost to subscribe to a commercial insurance company for coverage.However,these companies often lose some of the advantages of going with a commercial carrier,such as pooling.

Question 3

Companies establish retirement plans following which of these three design configurations?

Accepted Answer

A)   defined benefit, defined contribution, hybrid
B)   qualified benefit, qualified contribution, hybrid
C)   qualified benefit, nonqualified benefit, hybrid
D)   funded, unfunded, hybrid A

Question 4

According the provisions in her health insurance plan with Get Well Insurance,Ursula's coinsurance payment would be $50 if she goes to Dr.Kitt,but will only be $25,if she goes to Dr.Matthew.She probably belongs to what type of insurance plan?

Accepted Answer

A)   point-of-service plan (POS) 
B)   preferred provider organization (PPO) 
C)   health maintenance organization (HMO) 
D)   fee-for-service plan

Question 5

This consumer-driven health care option allows employees to contribute pre-tax wages annually to pay for qualified medical expenses,but they will lose the balance not used at year's end.

Accepted Answer

A)   flexible spending accounts
B)   health reimbursement arrangements
C)   health savings accounts
D)   flexible savings accounts

Question 6

What is another name for health maintenance organizations (HMOs)?

Accepted Answer

A)   outpatient medical services
B)   prepaid medical services
C)   inpatient medical services
D)   on-call medical services

Question 7

________ refers to an employee's nonforfeitable rights to pension benefits.

Accepted Answer

The answer of ________ refers to an employee's nonforfeitable rights...

Question 8

Starting January 1,2004,eligible individuals are allowed to establish HSAs under which law?

Accepted Answer

A)   Health Maintenance Organization Act
B)   Mental Health Parity Act
C)   Medicare Prescription Drug, Improvement and Modernization Act
D)   HIPAA

Question 9

What specifies the rate at which participants accumulate benefits?

Accepted Answer

A)   accrual rules
B)   combination procedures
C)   Sarbanes-Oxley
D)   build-up rules

Question 10

Mia has Parkinson's disease,but is on an insurance plan that enables her to have the drugs shipped to her house.She is probably on which type of prescription drug plan?

Accepted Answer

A)   prescription card program
B)   formulary
C)   mail order
D)   medical reimbursement

Question 11

Which one of the following is probably the main reason that health reimbursement accounts (HRAs)are particularly appealing to employees with relatively low salaries or hourly wages?

Accepted Answer

A)   the contribution of employees is on a pretax basis
B)   employees do not contribute to them
C)   employees forfeit unused balances present at the end of a year
D)   permits employees to carry unused balances from year to year

Question 12

Jose invested $6,000 in pre-tax income into this healthcare plan,but lost the $780 left in it at the end of the year,because he didn't use it.What type of plan was it?

Accepted Answer

A)   health savings account
B)   flexible spending account
C)   health reimbursement arrangement
D)   fee-for service plan

Question 13

A new employee comes into your office and asks you how many hours a year he has to work to qualify as a year towards his vesting requirements.What would you tell him?

Accepted Answer

A)   1,000
B)   1,400
C)   800
D)   1,200

Question 14

These represent a series of payments for the life of the participant and beneficiary.

Accepted Answer

A)   collateral payments
B)   periodic payments
C)   lump sum distributions
D)   annuities

Question 15

________ physicians determine when patients need the care of specialists,and help to control costs by reducing the number of unnecessary visits to specialists.

Accepted Answer

The answer of ________ physicians determine when patients need the...

Question 16

Marty's employer has a prescription drug plan that will only make him pay 20% of cost of his prescription,if he goes only to certain pharmacies.What type of prescription drug plan does he have?

Accepted Answer

A)   prescription reimbursement plan
B)   medical reimbursement plan
C)   mail order prescription drug plan
D)   prescription card program

Question 17

Which of the following is NOT a benefit covered by fee-for-service plans?

Accepted Answer

A)   hospitalization benefits
B)   dentist visits
C)   physician visits
D)   surgical benefits

Question 18

These types of insurance plans are set up to cover things like dental care,vision care,and prescription drugs.

Accepted Answer

A)   flexible savings plans
B)   flexible services accounts
C)   carve-out plans
D)   health services accounts

Question 19

What type of pension plan commonly includes profit-sharing plans,stock bonus plans,and employee stock ownership plans?

Accepted Answer

A)   defined benefit
B)   defined contribution
C)   deferred contribution
D)   deferred benefit

Question 20

Which of the following is associated with 401(k)plans?

Accepted Answer

A)   Employees pay taxes on their contribution.
B)   Employees do not pay taxes on their contributions.
C)   Investment gains are taxed.
D)   Employees cannot deduct their contributions from taxable income.

Exam 10: Employer-Sponsored Retirement Plans and Health Insurance Programs