Maine Life Insurance Exam Questions With Complete
Solutions.
Contributory Health Insurance
If the employees share a portion of the premium. Often require participation by 75% of
eligible members.
Noncontributory Health Insurance
If the employer pays the entire premium. Most require 100% participation by eligible
members.
(Funding of Group Insurance) Shared funding
Allows employer to self-fund health care expenses, select a deductible and pay covered
expenses for any individual incurring claims up to that max, insurer assumes risk
(Funding of group insurance) Min. premium arrangement
Employer self-insure the normal and expected claims up to a given amount and the
insurer funds only the excess amounts
(Funding of group insurance) retrospective premium arrangement
Insurer agrees to collect a provisional premium but may collect additional
premium/make a premium refund at the end of the year based on actual incurred
losses.
(Funding of group insurance) Self-funding arrangement
Large employers may elect to fully self-fund, or may self-fund a plan but contract for
administrative services only (ASO).
Conversion privilege
An employee can convert their group certificate to an individual medical expense policy
w/ same insurer, if/when they leave employer. Employee must make an application for a
converted policy within a given period of time (usually 31 days) depending on the state.
Health Insurance Portability and Accountability Act (HIPAA)
Provides the ability to transfer and continue health insurance when someone changes
or loses their job
HIPAA Requirements
Employers with 20 or more employees have to allow former employees to continue
benefits. Rules apply to all types of group health plans except disability income plans
HIPAA pre-existing conditions
Health issues that existed, were treated, diagnosed within 6 months prior to
employment
COBRA
Requires employers with 20+ employees to continue coverage for terminated workers,
(as well as dependents) for up to 18 months. Employee is required to pay premiums (up
to 102%)
Group Disability Income Plans
Specify benefits based on a percentage of the employees wages
Blanket Health Plans
Cover a group who may be exposed to the same risk, no certificates issued
Taxation of group health premiums
, Employers are entitled to take a tax deduction for premium contributions made to group
plans
Taxation of group health benefits
Any benefit received under a medical expense plan are not considered taxable income.
Accidental means
Requires that both the cause and the result of an accident must be unintentional
accidental results
only the injury resulting from the accident must be unintentional.
3 basic categories of health insurances
Medical Expense, Disability Income Insurance, AD&D
Health insurance premium factors
Interest, expenses, types of benefits, morbidity, age, sex, occupation
Disability Buy-Sell (business income policy)
Legal agreement that specifies how a business will pass between owners when one of
the owners dies or becomes disabled
Business overhead expense (business income policy)
Sold to small business owners who must continue to meet overhead expenses such as
rent, used if owner becomes disabled. Covers fixed business expenses
Disability Buy-Out (business income policy)
Specifies who will purchase a disabled partner's interest and legally obligates that
person/party to purchase the business interest of the disabled partner.
Maternity Benefits
Any policy of health insurance that provides maternity care must also cover the services
of nurses/midwives, and licensed birth centers.
Coordination of Benefits provision
Prevents an insured covered by two health plans from making a profit on a covered loss
Waiting period in a group health policy
gives insurance company the right to delay coverage for a covered sickness for a
specified number of days after the effective date of the policy
HMOs (Health Maintenance Organizations)
Not only finance health care services for their subscribers, but also organize and deliver
the health services as well. Subscribers pay a fixed and periodic fee.
Capitation
Payment given to primary care provider for each HMO member assigned to them
Closed panel
When the HMO is represented by a group of physicians who are salaried employees
and work out of the HMO's facility. "Open panel" works out of their own facility.
PPO (Preferred provider organizations)
A collection of health care providers who offer their services to certain groups at
prearranged discount prices.
Medicare
Provides hospital/medical expense insurance to those over 65. Provides protection to
anyone suffering from chronic kidney disease or those who have been receiving social
security disability benefits for at least 24 months.
Medicaid
Financed by both the state and federal governments.
Solutions.
Contributory Health Insurance
If the employees share a portion of the premium. Often require participation by 75% of
eligible members.
Noncontributory Health Insurance
If the employer pays the entire premium. Most require 100% participation by eligible
members.
(Funding of Group Insurance) Shared funding
Allows employer to self-fund health care expenses, select a deductible and pay covered
expenses for any individual incurring claims up to that max, insurer assumes risk
(Funding of group insurance) Min. premium arrangement
Employer self-insure the normal and expected claims up to a given amount and the
insurer funds only the excess amounts
(Funding of group insurance) retrospective premium arrangement
Insurer agrees to collect a provisional premium but may collect additional
premium/make a premium refund at the end of the year based on actual incurred
losses.
(Funding of group insurance) Self-funding arrangement
Large employers may elect to fully self-fund, or may self-fund a plan but contract for
administrative services only (ASO).
Conversion privilege
An employee can convert their group certificate to an individual medical expense policy
w/ same insurer, if/when they leave employer. Employee must make an application for a
converted policy within a given period of time (usually 31 days) depending on the state.
Health Insurance Portability and Accountability Act (HIPAA)
Provides the ability to transfer and continue health insurance when someone changes
or loses their job
HIPAA Requirements
Employers with 20 or more employees have to allow former employees to continue
benefits. Rules apply to all types of group health plans except disability income plans
HIPAA pre-existing conditions
Health issues that existed, were treated, diagnosed within 6 months prior to
employment
COBRA
Requires employers with 20+ employees to continue coverage for terminated workers,
(as well as dependents) for up to 18 months. Employee is required to pay premiums (up
to 102%)
Group Disability Income Plans
Specify benefits based on a percentage of the employees wages
Blanket Health Plans
Cover a group who may be exposed to the same risk, no certificates issued
Taxation of group health premiums
, Employers are entitled to take a tax deduction for premium contributions made to group
plans
Taxation of group health benefits
Any benefit received under a medical expense plan are not considered taxable income.
Accidental means
Requires that both the cause and the result of an accident must be unintentional
accidental results
only the injury resulting from the accident must be unintentional.
3 basic categories of health insurances
Medical Expense, Disability Income Insurance, AD&D
Health insurance premium factors
Interest, expenses, types of benefits, morbidity, age, sex, occupation
Disability Buy-Sell (business income policy)
Legal agreement that specifies how a business will pass between owners when one of
the owners dies or becomes disabled
Business overhead expense (business income policy)
Sold to small business owners who must continue to meet overhead expenses such as
rent, used if owner becomes disabled. Covers fixed business expenses
Disability Buy-Out (business income policy)
Specifies who will purchase a disabled partner's interest and legally obligates that
person/party to purchase the business interest of the disabled partner.
Maternity Benefits
Any policy of health insurance that provides maternity care must also cover the services
of nurses/midwives, and licensed birth centers.
Coordination of Benefits provision
Prevents an insured covered by two health plans from making a profit on a covered loss
Waiting period in a group health policy
gives insurance company the right to delay coverage for a covered sickness for a
specified number of days after the effective date of the policy
HMOs (Health Maintenance Organizations)
Not only finance health care services for their subscribers, but also organize and deliver
the health services as well. Subscribers pay a fixed and periodic fee.
Capitation
Payment given to primary care provider for each HMO member assigned to them
Closed panel
When the HMO is represented by a group of physicians who are salaried employees
and work out of the HMO's facility. "Open panel" works out of their own facility.
PPO (Preferred provider organizations)
A collection of health care providers who offer their services to certain groups at
prearranged discount prices.
Medicare
Provides hospital/medical expense insurance to those over 65. Provides protection to
anyone suffering from chronic kidney disease or those who have been receiving social
security disability benefits for at least 24 months.
Medicaid
Financed by both the state and federal governments.
