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Complete Florida Health Insurance Agent 2 - 40
Pre-Licensing Exam 2024- 2025 (300 Frequently
Tested Questions with Rationale) MULTIPLE
CHOICE EXAM
Which of the following is NOT TRUE regarding eligibility for subsidies for families under the new health care act?
- For those who make between 100-400% of the Federal Poverty - Level
- Cannot be covered by an employer
- Cannot be eligible for Medicare
- Can be eligible for Medicaid Can be eligible for Medicaid Which of the following operates as a corporation, society, or association to provide life insurance primarily for the mutual benefit of its members, has a lodge or social system with rituals and representative form of government? A) Mutual companies B) Fraternal associations C) Stock companies
- Fraternal benefit society B) Fraternal associations
What does each member pay in a typical HMO plan?
- Fixed premium based on a deductible and copay
- Fixed premium whether or not plan is used
- Premium based on how often plan is used Fixed premium whether or not plan is used Which of the following is correct about those who are eligible for Medicare and wish to join an HMO?
- They must have a current Medicare supplement policy
- They must be told that'll be getting all the benefits from the Medicare Advantage plan
- They must be age 70 and above
- They must have been enrolled previously in an HMO They must be told that'll be getting all the benefits from the Medicare Advantage plan Joyce is totally disabled. Her HMO policy just terminated. All of the following are correct regarding "extension of benefits" for Joyce, EXCEPT?
- Coverage ends once maximum benefits have been exhausted
- Coverage ends once another carrier assumes coverage
- Coverage ends if no longer totally disabled
- Coverage ends after 18 months
- 10 days
- 5 days
- 14 days 10 days Which of the following statements about health service organizations is true?
- They reimburse Policyowners directly for physicians' fees
- They provide loss of income benefits to Policyowners
- They reimburse Policyowners directly for all medical expenses
- They provide benefit payments directly to the hospitals and physicians providing services They provide benefit payments directly to the hospitals and physicians providing services What is the period of time for an HMO "open enrollment"?
- 45 days during every 18-month period
- 30 days during every 12-month period
- 30 days during every 18-month period
- 45 days during every 12-month period 30 days during every 18-month period
If an HMO is found guilty of unfair trade practices, what is the maximum penalty that can be charged?
- Up to $50,
- Up to $150,
- Up to $200,
- Up to $100, Up to $200, Which of the following statements about Worker's Compensation laws is INCORRECT?
- Employers can purchase coverage through the state program, private insurers or can self-insure
- Worker's compensation provides benefits for work-related injuries, illness or death
- Not all states have a workers compensation law
- Basic principle is that work-related injuries are compensable by the employer without regard to fault Not all states have a workers compensation law What year was the Social Security Act amended to add health insurance protection for the aged and disabled?
- 1973
- 1965
- 1985
- 1935
Commercial insurers All of the following are true about a multiple employer welfare arrangement (MEWA), EXCEPT?
- Required by law to have an employment-related common bond
- Often provide insurance on a self-insured basis
- Tax-exempt entities
- Large employers who have joined together to provide health insurance benefits Large employers who have joined together to provide health insurance benefits (Explanation: MEWAs consist of small employers who join together to provide health insurance benefits for their employees) Grouping small businesses together to obtain health insurance as one large group is a characteristic of what type of group?
- Multiple Employer Trust (MET)
- Franchise Health plan
- Health Maintenance Organization (HMO)
- Blue Cross/Blue Shield Multiple Employer Trust (MET)
Casey has a medical expense policy that provides a fixed rate of $150 per day for hospitalization. Casey is hospitalized for 10 days and incurred covered medical expenses of $20,000. What will her medical expense policy pay?
- $1,
- $20,
- $15,
- $3,0 00 $1,500 (Explanation: Casey's policy will only cover a fixed rate per day for hospitalization of $150. If she is hospitalized for 10 days, then her policy will pay $1,500 ($150 x 10) of the total $20, in expenses.) Jamie has a reimbursement type medical expense policy with a maximum benefit of $500,000. She is hospitalized and incurs $25,000 in covered medical expenses. What will her policy provide in coverage?
- $20,
- $25,
- $10,
- $12, $25,000 (Explanation: A reimbursement type policy will provide coverage for expenses incurred. In this case that would be the total $25,000.) Which of the following will not be covered under "Miscellaneous Expenses" of a hospital expense policy?
$2,500 (Explanation: Hospital will pay - $1,000 for room and board ($100 per day for 10 days) and $1, (maximum allowed) for miscellaneous expenses. Surgical will pay - $500 (maximum allowed) for surgery) Once the insured has paid a specified amount of his expenses, under the stop-loss feature of a health insurance policy, how much will the company then pay?
- 75%
- 20%
- 80%
- 100% 100% How will the "miscellaneous expenses" benefit be expressed in a basic health insurance policy?
- Reasonable, usual and customary rates
- Multiple of daily room and board rate
- Approved charge per day rate
- Percentage of daily room and board rate Multiple of daily room and board rate
Roberta has a basic hospital expense policy with a $10,000 limit for benefits, coordinated with a major medical policy with a $500 corridor deductible and 80/ coinsurance provision. If she incurs a loss of $20,000, how much will the insurer pay?
- $17,
- $18,
- $11,
- $2, $17,600 (Explanation: Total expenses are $20,000. Basic medical will pay the first $10,000 which leaves $10,000 remaining. Roberta will pay the first $500 of this $10,000 with $9, remaining. Company will now pay 80% of $9,500 or $7,600. Total company pays will be $10,000 from the basic medical plus $7,600 from the major medical = $17,600) Which of the following statements is TRUE about basic hospital, medical and surgical expense policies?
- The benefits provided are usually equal to the actual expenses incurred
- They contain high deductibles
- They usually have a stated limit for specific expenses
- Benefits are provided for loss of income They usually have a stated limit for specific expenses Which of the following types of insurance policies combines several types of benefits and provides more coverage than any of the others?
- Hospital expense
- Comprehensive major medical
$1,500 (Explanation: Travis will pay the first $500 (deductible) and then 20% of the next $5,000 ($5,000 x. = $1,000. So Travis will pay a total of $1,500 (deductible plus 20% of $5,000).) Which of the following is NOT a form of medical insurance?
- Business overhead expense
- Surgical expense
- Hospital expense
- Long term care Business overhead expense (Explanation:Business Overhead Expense insurance is designed to reimburse a business for overhead expenses in the event a business owner becomes disabled. Expenses such as rent, utilities, telephone, equipment, employees' salaries, etc.) All of the following are state or federal government programs that provide health insurance, EXCEPT?
- Medicare
- OASDI disability
- Medicaid
- Medigap Medigap (Explanation:A Medigap policy is a Medicare supplement insurance policy sold by private insurance companies to fill "gaps" in Medicare Parts A and B.) What type of health insurance is available to assist low-income individuals?
Medicaid What types of reserves are set aside and held by health insurance companies? Premium and Claims reserves (Explanation:Reserves are set aside for the payment of future claims.) Group health insurance is generally written on a basis that provides for dividends or experience rating. What is the basis called? Participating (Explanation:Group plans written by mutual companies provide for dividends while stock companies frequently issue experience-rated plans.) When comparing a major medical policy having an 80%/20% coinsurance provision with one having a 75%/25% coinsurance provision, the insured will pay more or less premium for the 80%/20% provision?
- Less premium
- The same premium
- Significantly less premium
- More premium More premium (Explanation: Because the insured will be responsible for less of the cost for medical expenses (20% verses 25%), he will pay more in premium costs.)
- Hospital Fixed-rate policy
- Hospital expense policy Hospital Fixed-rate policy What type of medical expense policy would be available to cover the high costs associated with a specific kind of illness such as cancer or heart disease?
- Hospital expense
- Surgical expense
- Major medical
- Limited risk Limited risk (Explanation: Limited risk or dread disease policies are designed specifically to cover the high costs associated with a specific illness.) William was involved in a 2-car accident in which he is disabled and his passenger and the driver of the other car are injured. Which of the following would most likely be covered by William's disability income policy?
- Disability of the other driver
- His lost income
- William's medical expenses
- Dismemberment of the passenger's leg His lost income
Cathy is a dentist and decides to purchase insurance that would cover a large portion of her income should she become disabled. What type of coverage will she purchase?
- Disability income insurance
- Business overhead expense insurance
- Medical expense insurance
- Lump sum disability Disability income insurance All of the following are true regarding a disability income policy defining total disability as "own occupation", EXCEPT?
- Insured is unable to work at their own occupation as a result of an accident or sickness
- Difficult to qualify for
- More advantageous to the insurer
- More expensive than a policy providing "any occupation" More advantageous to the insurer Which of the following terms relates to payments made for partial disabilities?
- Residual amount
- Gross amount
- Net amount
- Recurrent amount
- Short-term and long-term
- Short term and interim term
- Basic term and broad term
- Full term and partial term Short-term and long-term Tad earns $2,000 a month and currently has a disability income policy with Company X and is limited to a monthly benefit of $400. If Tad decides to purchase another disability income policy from Company Z and Company Z's limit on benefits is 70% of his monthly income, how much coverage can he purchase with this second disability policy?
- $1,
- $1,
- $1,
- $1, $1,000 (Explanation: Tad currently has a disability income policy that will pay him $400 per month. The second policy limits payments to 70% of his income, which would be ($2,000 x .70 = $1,400) $1,400. Because he is already covered for $400 by Company X, Company Z will only pay $1,000 per month. The total of the two policies will then equal 70% of Tad's monthly pre disability income of $2,000.) Peter is injured in an auto accident. He is only able to work on a part-time basis and at 60% of his predisability salary. If Peter's disability income policy provides for residual disability benefits of $2,000, what amount would he receive in monthly benefit payments?
- $1,
$800 (Explanation: Residual amount benefit is based on the proportion of income actually lost due to the partial disability, taking into account the fact that the insured is able to work and earn some income. The benefit is usually determined by multiplying the percentage of lost income by the stated monthly benefit for total disability. In this example Peter is would receive 40% of the total disability benefit of $2,000 which will equal $2,000 x .40 = $800.) Joseph has a disability income policy stating a flat amount of $2,000 monthly benefit. He has been totally disabled for 6 months but is now able to work part-time. What can he expect to receive from his disability income policy if the policy also covers partial disability?
- $1,000 monthly benefit
- $500 monthly benefit
- $0 benefit
- $2,000 monthly benefit $1,000 monthly benefit What form of insurance is the primary form of pure accident coverage?
- Major Medical
- Disability Income
- Medical Expense
