Question 1

The Affordable Care Act requires employers with 100 or more employees to provide health insurance on the employees or pay a penalty if at least one employee receives a tax credit and coverage through the Health Insurance Marketplace.This requirement-providing insurance or paying a fine-is known as the

Accepted Answer

The requirement described in the question is the employer shared responsibility provision of the Affordable Care Act. This provision applies to employers with 100 or more employees and requires them to provide health insurance to their employees or pay a penalty if at least one employee receives a tax credit and coverage through the Health Insurance Marketplace.

Question 2

Doris started a business 2 years ago.The business has been successful,and Doris is thinking about offering some employee benefits for her workers.She plans to offer a group term life insurance benefit.All of the following are usual eligibility requirements for participation in a group life insurance plan EXCEPT

Accepted Answer

A two-year probationary period is not usually a usual eligibility requirement for participation in a group life insurance plan. The other options listed (full-time employment, active at work when insurance becomes effective, and applying during the eligibility period) are typical eligibility requirements for group life insurance plans.

Question 3

Under many cafeteria plans,employees make premium contributions with pre-tax dollars and a salary reduction that are used to purchase group health insurance or dental insurance.This type of cafeteria plan is called a

Accepted Answer

Premium conversion plans, also known as premium-only plans or POPs, allow employees to pay their portion of group health and dental insurance premiums with pre-tax dollars via salary reduction contributions.

Question 4

The Affordable Care Act created program that enables small firms to offer health insurance to their employees.The program provides flexibility,choice,and the convenience of on-line account management.This program is called the

Accepted Answer

The option that fits the description is the SHOP (Small Business Health Options Program) Marketplace program, which was created by the Affordable Care Act to help small businesses offer health insurance to their employees. The program allows for flexibility, choice, and online account management. Medical Advantage plans and Medicaid are different programs, and there is no known program called FAIR plan related to offering health insurance to small businesses.

Question 5

Nancy's employer provides an interesting employee benefit plan.Each employee is given 250 employee benefit credits to spend.A wide array of benefits is available,and the employee uses benefit credits to select the benefits that he or she wants.This type of employee benefit plan is called a(n)

Accepted Answer

This type of employee benefit plan is commonly known as a cafeteria plan or flexible benefit plan. It allows employees to select the benefits they want from a menu of options, using a set number of benefit credits. This gives employees more control over their benefits and allows them to tailor their options to their individual needs.

Question 6

Under older group medical expense plans,physicians were paid a fee for each covered service and were reimbursed on the basis of reasonable and customary charges,up to a maximum limit.These older group medical expense plans were called

Accepted Answer

Indemnity plans were designed this way, with physicians being paid a fee for each covered service and reimbursed based on reasonable and customary charges, up to a maximum limit. Service medical plans, managed care plans, and point-of-service plans all have different payment and reimbursement structures.

Question 7

Marv is covered by a group health insurance plan at work.His employer funds the entire cost of the group health insurance.Because of this characteristic,the group health insurance plan can be described as

Accepted Answer

Since Marv's employer funds the entire cost of the group health insurance plan, it is considered noncontributory. Contributory plans require employees to pay part of the premiums. Defined benefit and defined contribution plans refer to retirement plans, not health insurance.

Question 8

Which of the following is a characteristic of a health maintenance organization (HMO)?

Accepted Answer

HMOs have an emphasis on cost containment and typically offer a restricted network of healthcare providers and limited medical services. They often require referrals from primary care physicians and may have low or no co-payments, but patients generally have less choice in their healthcare providers compared to other types of insurance plans.

Question 9

Which of the following is a provision of the Affordable Care Act?

Accepted Answer

The Affordable Care Act includes provisions to prohibit harmful practices by insurers, such as denying coverage based on pre-existing conditions or instituting annual and lifetime limits on coverage. Strengthening pre-existing condition exclusions and eliminating flexible spending accounts are not provisions of the ACA.

Question 10

An employer-funded plan with favorable tax advantages,which repays employees for medical care not covered by the employer's standard medical plan is a(n)

Accepted Answer

A health reimbursement arrangement (HRA) is an employer-funded plan which provides employees with tax-free reimbursement for eligible medical expenses not covered by the employer's standard medical plan. This makes it beneficial for both the employer and employee, as the benefits are not taxable to the employee and the employer can deduct the expenses. 401(k) accounts and individual retirement accounts (IRAs) are retirement savings accounts, and flexible spending accounts (FSAs) also provide reimbursement for medical expenses but are funded by employees through pre-tax contributions.

Question 11

Which of the following statements is (are)true with regard to group life insurance?
I.Most group life insurance is whole life coverage.
II.Most group life insurance plans allow a modest amount of life insurance on the employee's spouse and dependent children.

Accepted Answer

Statement I is false as most group life insurance is actually term life coverage. Statement II is true as many group life insurance plans offer coverage for the employee's spouse and dependent children, usually up to a certain limit.

Question 12

Which of the following statements regarding recent developments in employer-sponsored health plans is (are)true?
I.Preferred provider organizations (PPOs)continue to dominate group health insurance markets.
II.The number of employers offering medical benefits to workers who retire early has increased.

Accepted Answer

Preferred provider organizations (PPOs) continue to be a dominant model in group health insurance markets due to their flexibility in allowing insured individuals to choose their healthcare providers. On the other hand, the trend has been for employers to reduce or eliminate medical benefits for early retirees, primarily due to rising healthcare costs.

Question 13

Which of the following statements about recent developments in employer-sponsored health plans is true?

Accepted Answer

High-deductible health plans with a savings option have continued to grow in recent developments in employer-sponsored health plans. Medical coverage for early retirees has actually decreased, traditional insured plans are becoming less popular compared to PPO plans, and premiums for health insurance have not continued to decline.

Question 14

HMOs typically pay network physicians or medical groups a fixed annual or monthly payment for each member,regardless of the frequency or type of service provided.This payment is called a

Accepted Answer

HMOs pay network physicians or medical groups a fixed annual or monthly payment for each member, regardless of the frequency or type of service provided. This payment is called a capitation fee.

Quiz 16: Employee Benefits: Group Life and Health Insurance