Medical Insurance Chap 1-6 Midterm Review Questions and Answers Already Passed Latest Update
2025-2026
Traditional/ Indemnity Insurance Plan - Answersfocuses on sickness(loss). With this type of insurance
benefits are paid when there is a definitive sick diagnosis. There is NO need for PCP, NO referrals, and
NO network.
Managed Care Insurance Plans - Answersfocuses on cost containment. WELLNESS is emphasized. Well
visits are covered, as is smoking cessation, weight loss and gym membership. Policy holders MUST have
a PCP who becomes the gatekeeper and issues referrals. MUST stay within network or must pay
additional money to the provider.
HMO's - AnswersHealth Maintenance Organization. The original form of Managed Care insurance.
Affordable, use of a PCP, use of referrals, use of network. Payment is made to the provider through
CAPITATION.
Capitation - Answersa fixed prepayment based on enrolled patients in the practice.
PCP/ Gatekeeper - AnswersPrimary Care Physician. a physician that manages a patients primary health
concerns. Known as a gatekeeper because the PCP must issue referrals if the patient wants to see a
specialist and have the insurance pay.
Insured - Answersthe policyholder. the person who owns the policy or contract with the health
insurance company. AKA subscriber.
Dependent - Answersrelated to the insured and covered under their policy. Ex. spouse, child, or other
dependent.
Deductible - Answersan "out of pocket expense" that the insured is responsible for paying before
benefits are paid by the health insurance company.
Out of pocket expense - Answersany expense that the insured/patient is responsible for
Premium - Answersa dollar amount that the insured pays to keep the health insurance policy in effect.
Procedure - Answersservice that the doctor performed. Always 5 digits in length. Procedures represent
money$$. Procedures must be medically necessary for reimbursement.
Diagnosis - AnswersRepresents what is wrong with the patient. A number showing signs and symptoms.
Giving a name to the problem.3-7 characters in length, always a decimal point after the 3rd character.
Medically Necessary - Answerskey term which allows a service to be reimbursed. Medical necessity
refers to a procedure being medically appropriate to the diagnosis.
ICD - AnswersInternational Classification of Diseases. ICD codes are numerical and alpha-numeric codes
used for diagnoses.
, CPT - AnswersCurrent Procedural Terminology. CPT codes are numerical codes used for procedures.
Modifiers - Answers2 digit numerical code that is added on to a procedure code, as an extension to
denote special circumstances. EX. mod 76 means repeat procedure.
Encounter Form aka Super Bill - AnswersA service form also called a superbill that lists health care
procedure codes completed during a patient's office visit.
Patient Information Form - AnswersForm that includes a patients personal information, employment,
insurance info, and data needed to complete the CMS 1500.
Subjective Information - AnswersWhat the patient says. Based of symptoms and opinion.
Objective Information - AnswersWhat the provider observes. Based off signs and factual information.
EOB - AnswersExplanation of benefits is sent by the payer to a patient that shows how the amount of
benefit was determined
ERA - AnswersElectronic remittance advice is a health plan document describing payment resulting from
a claim adjudication. This copy is sent to provider.
Medical Records - Answerscontain detailed, documented information that is associated with each
patient; encounter, results, conversation, reports. If it is not documented it did not happen!
Assignment of benefits - Answersauthorization by a policy holder that allows a health plan to pay
benefits directly to the provider.
HIPAA - AnswersHealth Insurance Portability and Accountability Act of 1996. Federal act that set forth
guidelines for protecting the security and privacy of health information.
Schedule of benefits - Answersa list of covered services and the amount of payment that will be made
for covered services under a policy.
Fee-for-service - Answersa reimbursement where the payment is based on the fee charged.
First Party - AnswersPatient/Insured
Second Party - AnswersProvider
Third Party - AnswersHealth Insurance Company
Consultation - AnswersOnly used in an inpatient hospital setting. Looking and giving an opinion.
What do all E/M codes start with? - Answers99
E/M Codes - AnswersEvaluation and Management codes are procedure codes that represent physician
services that are performed to determine the course of treatment for a new patient.
2025-2026
Traditional/ Indemnity Insurance Plan - Answersfocuses on sickness(loss). With this type of insurance
benefits are paid when there is a definitive sick diagnosis. There is NO need for PCP, NO referrals, and
NO network.
Managed Care Insurance Plans - Answersfocuses on cost containment. WELLNESS is emphasized. Well
visits are covered, as is smoking cessation, weight loss and gym membership. Policy holders MUST have
a PCP who becomes the gatekeeper and issues referrals. MUST stay within network or must pay
additional money to the provider.
HMO's - AnswersHealth Maintenance Organization. The original form of Managed Care insurance.
Affordable, use of a PCP, use of referrals, use of network. Payment is made to the provider through
CAPITATION.
Capitation - Answersa fixed prepayment based on enrolled patients in the practice.
PCP/ Gatekeeper - AnswersPrimary Care Physician. a physician that manages a patients primary health
concerns. Known as a gatekeeper because the PCP must issue referrals if the patient wants to see a
specialist and have the insurance pay.
Insured - Answersthe policyholder. the person who owns the policy or contract with the health
insurance company. AKA subscriber.
Dependent - Answersrelated to the insured and covered under their policy. Ex. spouse, child, or other
dependent.
Deductible - Answersan "out of pocket expense" that the insured is responsible for paying before
benefits are paid by the health insurance company.
Out of pocket expense - Answersany expense that the insured/patient is responsible for
Premium - Answersa dollar amount that the insured pays to keep the health insurance policy in effect.
Procedure - Answersservice that the doctor performed. Always 5 digits in length. Procedures represent
money$$. Procedures must be medically necessary for reimbursement.
Diagnosis - AnswersRepresents what is wrong with the patient. A number showing signs and symptoms.
Giving a name to the problem.3-7 characters in length, always a decimal point after the 3rd character.
Medically Necessary - Answerskey term which allows a service to be reimbursed. Medical necessity
refers to a procedure being medically appropriate to the diagnosis.
ICD - AnswersInternational Classification of Diseases. ICD codes are numerical and alpha-numeric codes
used for diagnoses.
, CPT - AnswersCurrent Procedural Terminology. CPT codes are numerical codes used for procedures.
Modifiers - Answers2 digit numerical code that is added on to a procedure code, as an extension to
denote special circumstances. EX. mod 76 means repeat procedure.
Encounter Form aka Super Bill - AnswersA service form also called a superbill that lists health care
procedure codes completed during a patient's office visit.
Patient Information Form - AnswersForm that includes a patients personal information, employment,
insurance info, and data needed to complete the CMS 1500.
Subjective Information - AnswersWhat the patient says. Based of symptoms and opinion.
Objective Information - AnswersWhat the provider observes. Based off signs and factual information.
EOB - AnswersExplanation of benefits is sent by the payer to a patient that shows how the amount of
benefit was determined
ERA - AnswersElectronic remittance advice is a health plan document describing payment resulting from
a claim adjudication. This copy is sent to provider.
Medical Records - Answerscontain detailed, documented information that is associated with each
patient; encounter, results, conversation, reports. If it is not documented it did not happen!
Assignment of benefits - Answersauthorization by a policy holder that allows a health plan to pay
benefits directly to the provider.
HIPAA - AnswersHealth Insurance Portability and Accountability Act of 1996. Federal act that set forth
guidelines for protecting the security and privacy of health information.
Schedule of benefits - Answersa list of covered services and the amount of payment that will be made
for covered services under a policy.
Fee-for-service - Answersa reimbursement where the payment is based on the fee charged.
First Party - AnswersPatient/Insured
Second Party - AnswersProvider
Third Party - AnswersHealth Insurance Company
Consultation - AnswersOnly used in an inpatient hospital setting. Looking and giving an opinion.
What do all E/M codes start with? - Answers99
E/M Codes - AnswersEvaluation and Management codes are procedure codes that represent physician
services that are performed to determine the course of treatment for a new patient.
