M Has A Major Medical Insurance Policy

Question: J’s Major Medical policy has a $2,000 deductible and an 80/20 Coinsurance clause. If J is hospitalized and receives a bill for $10,000, J would pay

$1,600

$2,000

$3,600

$8,000

Answer: In this situation, ($2,000) + 20% of $8,000 the remaining bill ($1,600) = $3,600.

Question: Which of these options can an individual use their medical flexible spending account to pay for?

Vitamins and supplements

Prescription drugs

Household expenditures

Cosmetic procedures

Answer: Prescription drugs

Question: The first portion of a covered Major Medical insurance expense that the insured is required to pay is called the

corridor deductible

initial deductible

stop-loss deductible

coinsurance deductible

Answer: initial deductible

Question: Which of the following statements BEST describes the intent of a Coinsurance clause in a Major Medical policy?

Discourages overutilization of the insurance coverage

Minimizes the need for deductibles

Discourages adverse selection

Minimizes the waiting period

Answer: Discourages overutilization of the insurance coverage

Question: Basic Medical Expense insurance

normally has a deductible and coinsurance

covers an illness but not an accident

pays for lost wages while hospitalized

has lower benefit limits than Major Medical insurance

Answer: has lower benefit limits than Major Medical insurance

Question: For which of the following expenses does a Basic Hospital policy pay?

Hospital room and board

Prescription medication

Surgical fees

Physician’s fees

Answer: Hospital room and board

Question: M has a Major Medical insurance policy with a $200 flat deductible and an 80% Coinsurance clause. If M incurs a $2,200 claim for an eligible medical expense, how much will M receive in payment for this claim?

$2,000

$1,760

$1,600

$400

Answer: $1,600

In this situation, $2,200 - $200 deductible x 80% = $1,600.

$2,000 x 80% = $1600

$2,000 - $400 (20% of $2000) = $1600

Question:

Answer: $1,000

Question:

Answer: the employee paid for qualified medical expenses, the reimbursements may be tax-free

Question: Deductibles are used in health policies to lower

the incidents of fraud

the coinsurance amount

overuse of medical services

adverse selection

Answer: overuse of medical services