QUESTIONS AND VERIFIED ANSWERS|GRADED A+|BRAND NEW
Basic Medical Expense policies - ANSWER Provide coverage for Hospital, Surgical and Phy-
sicians Medical Expense.
-Purchased as a individual or group policy.
-provide first dollar coverage (no deductibles).
-limited benefit periods and low coverage limits.
Major Medical Expense Policy - ANSWER -A supplement (in addition) to Basic Medical or
as a stand-alone policy.
-individual or group policy.
-Take over when the Basic Policy runs out
Hospital Expenses - ANSWER -Pay for covered expenses incurred during a hospital stay.
1. Daily hospital benefit - Room and Board
2. Miscellaneous expenses - Other Medical Expenses (X-Rays, MRI, Prescriptions, Doctor Vis-
its)
Daily Hospital Benefit - ANSWER -Cost of a hospital room, up to a daily $ limit. The limit
may be expressed either as a dollar amount, e.g. $500 per day, or it may be expressed as the
Usual, Customary and Reasonable (UCR) and Charge
Usual, Customary and Reasonable (UCR) - ANSWER Insurance company will pay an
amount for a given procedure based upon the average charge for that procedure in that spe-
cific geographic area. The coverage is subject to a maximum amount or number of days.
Benefit Schedule - ANSWER -Specifically states what is covered in the plan and for how
much. The coverage is subject to a maximum amount or number of days.
1
,Indemnity - ANSWER Insured pays the bill and is reimbursed by the insurance company
up to a specified limit amount. Medical expense policies that pay a fixed rate provide the in-
sured with a stated benefit amount for each day of hospital confinement.
Reimbursement - ANSWER Policyowners obtain medical treatment from whatever source
they want and submit their charges to their insurer for reimbursement (actual amount).
Service Based Contracts - ANSWER -Pay doctors and hospitals directly according to the #
of days of coverage that is provided in the contract for each event and are prepayment
plans. Once a claim is settled, the insured will receive an Explanation of Benefit (EOB), which
is a written confirmation that the claim was paid. Blue Cross and Blue Shield, Health Service
Corporations and Medicare coverage are all provided on a Service Basis.
Miscellaneous Expense Benefits - ANSWER -Secondary benefits (inside benefits) because
they occur inside the hospital for charges related to the stay. X-rays, prescriptions, MRI's, an-
esthesia and lab fees are usually separate fees incurred during a stay. Miscellaneous Expense
Benefits have separate limits, referred to as Inside Limits. The are expressed usually as a
multiple of the daily amount (UCR)
Surgical Expense - ANSWER A schedule of procedures lists the amount allowable for each
procedure. If a surgical procedure is not found in the schedule, it will still be payable. The
amount payable for a procedure not listed is based on its relative value to a procedure of
similar difficulty. There are usually no deductibles.
Surgical Schedule - ANSWER Is simply a price list. Each procedure is listed and a dollar
amount assigned and if a procedure is not listed in the schedule it is still paid.
Relative Value - ANSWER scientific method of paying different benefits based on the re-
gion of the country an insured lives. It is based on assigning a value to each procedure and
using a conversion factor. A schedule of assigned points for each procedure must be included
in the policy.
2
, Physicians Medical Expense - ANSWER Pays for visits to the doctor (office hospital) plus
post operation care. There may be a per-visit benefit, or the coverage is based on UCR.
-May or may not be a deductible . This policy is usually written as an indemnity plan and has
first dollar coverage (no deductible).
-usually written as an indemnity plan and has first dollar coverage
Major Medical Expense - ANSWER -Cover "catastrophic" or huge loss. A Catastrophic loss
is defined as whenever Basic coverage runs out and not a specific dollar amount.
-High Maximum Limits ($2,000,000)
-Deductibles (per person or per family ea yr))
-Co- insurance (Usually 80/20%)
-Stop Loss
-Miscellaneous Expense Benefits - x-rays, MRI, lab tests, etc.
Coinsurance - ANSWER - Once the deductible is met the insured and the insurance com-
pany share in the expenses in what is called coinsurance. It is written as 80/20, 70/30, etc.
Also called percentage participation requirement.
Flat Deductible - ANSWER -Portion of medical expenses that are paid by the insured each
year before benefits start. The higher the deductible the lower the annual premium will be.
-If a medical incident occurs in the last three months of any plan year and the annual de-
ductible has met the yearly requirement then the medical treatment for that incident only
would be covered in the new plan year. Thus a "carryover" into the next year of the paid de-
ductible has occurred.
Per Cause Deductible - ANSWER A separate deductible for each separate illness or acci-
dent.
Stop Loss - ANSWER Max amount the insured is required to pay out of pocket: After the
stop loss amount is reached by the insured, in a calendar year, the company will pay 100% of
the remaining covered expenses.
3
Basic Medical Expense policies - ANSWER Provide coverage for Hospital, Surgical and Phy-
sicians Medical Expense.
-Purchased as a individual or group policy.
-provide first dollar coverage (no deductibles).
-limited benefit periods and low coverage limits.
Major Medical Expense Policy - ANSWER -A supplement (in addition) to Basic Medical or
as a stand-alone policy.
-individual or group policy.
-Take over when the Basic Policy runs out
Hospital Expenses - ANSWER -Pay for covered expenses incurred during a hospital stay.
1. Daily hospital benefit - Room and Board
2. Miscellaneous expenses - Other Medical Expenses (X-Rays, MRI, Prescriptions, Doctor Vis-
its)
Daily Hospital Benefit - ANSWER -Cost of a hospital room, up to a daily $ limit. The limit
may be expressed either as a dollar amount, e.g. $500 per day, or it may be expressed as the
Usual, Customary and Reasonable (UCR) and Charge
Usual, Customary and Reasonable (UCR) - ANSWER Insurance company will pay an
amount for a given procedure based upon the average charge for that procedure in that spe-
cific geographic area. The coverage is subject to a maximum amount or number of days.
Benefit Schedule - ANSWER -Specifically states what is covered in the plan and for how
much. The coverage is subject to a maximum amount or number of days.
1
,Indemnity - ANSWER Insured pays the bill and is reimbursed by the insurance company
up to a specified limit amount. Medical expense policies that pay a fixed rate provide the in-
sured with a stated benefit amount for each day of hospital confinement.
Reimbursement - ANSWER Policyowners obtain medical treatment from whatever source
they want and submit their charges to their insurer for reimbursement (actual amount).
Service Based Contracts - ANSWER -Pay doctors and hospitals directly according to the #
of days of coverage that is provided in the contract for each event and are prepayment
plans. Once a claim is settled, the insured will receive an Explanation of Benefit (EOB), which
is a written confirmation that the claim was paid. Blue Cross and Blue Shield, Health Service
Corporations and Medicare coverage are all provided on a Service Basis.
Miscellaneous Expense Benefits - ANSWER -Secondary benefits (inside benefits) because
they occur inside the hospital for charges related to the stay. X-rays, prescriptions, MRI's, an-
esthesia and lab fees are usually separate fees incurred during a stay. Miscellaneous Expense
Benefits have separate limits, referred to as Inside Limits. The are expressed usually as a
multiple of the daily amount (UCR)
Surgical Expense - ANSWER A schedule of procedures lists the amount allowable for each
procedure. If a surgical procedure is not found in the schedule, it will still be payable. The
amount payable for a procedure not listed is based on its relative value to a procedure of
similar difficulty. There are usually no deductibles.
Surgical Schedule - ANSWER Is simply a price list. Each procedure is listed and a dollar
amount assigned and if a procedure is not listed in the schedule it is still paid.
Relative Value - ANSWER scientific method of paying different benefits based on the re-
gion of the country an insured lives. It is based on assigning a value to each procedure and
using a conversion factor. A schedule of assigned points for each procedure must be included
in the policy.
2
, Physicians Medical Expense - ANSWER Pays for visits to the doctor (office hospital) plus
post operation care. There may be a per-visit benefit, or the coverage is based on UCR.
-May or may not be a deductible . This policy is usually written as an indemnity plan and has
first dollar coverage (no deductible).
-usually written as an indemnity plan and has first dollar coverage
Major Medical Expense - ANSWER -Cover "catastrophic" or huge loss. A Catastrophic loss
is defined as whenever Basic coverage runs out and not a specific dollar amount.
-High Maximum Limits ($2,000,000)
-Deductibles (per person or per family ea yr))
-Co- insurance (Usually 80/20%)
-Stop Loss
-Miscellaneous Expense Benefits - x-rays, MRI, lab tests, etc.
Coinsurance - ANSWER - Once the deductible is met the insured and the insurance com-
pany share in the expenses in what is called coinsurance. It is written as 80/20, 70/30, etc.
Also called percentage participation requirement.
Flat Deductible - ANSWER -Portion of medical expenses that are paid by the insured each
year before benefits start. The higher the deductible the lower the annual premium will be.
-If a medical incident occurs in the last three months of any plan year and the annual de-
ductible has met the yearly requirement then the medical treatment for that incident only
would be covered in the new plan year. Thus a "carryover" into the next year of the paid de-
ductible has occurred.
Per Cause Deductible - ANSWER A separate deductible for each separate illness or acci-
dent.
Stop Loss - ANSWER Max amount the insured is required to pay out of pocket: After the
stop loss amount is reached by the insured, in a calendar year, the company will pay 100% of
the remaining covered expenses.
3
