Question 1

Used in both fee for service and prepaid plans, copayments are costs that the patient must pay at the time they receive the services. It is a designated dollar amount.

Accepted Answer

Copayments are fixed amounts that patients are required to pay at the time of receiving medical services, and they are utilized in both fee-for-service and prepaid health plans (such as HMOs) as a way to share healthcare costs between the insurer and the insured.

Question 2

The Flexible Spending Account (FSA)has the following characteristics:

Accepted Answer

All of the statements are correct.

Question 3

Most insurance policies require a contribution from the covered individual which may be a copayment, deductible or coinsurance which is called cost sharing.

Accepted Answer

Cost sharing is a feature of many insurance policies, including health insurance, where the covered individual is required to pay a portion of the costs of their healthcare services. This can come in the form of copayments, deductibles, or coinsurance.

Question 4

A classification system called resource utilization group (RUG)was designed to differentiate patients based on how much they use the resources of the facility. As the patient's condition changes, the rate of reimbursement changes. A per diem rate was established using these classifications.

Accepted Answer

The Resource Utilization Group (RUG) system is indeed designed to classify patients based on their resource use in a facility, such as a nursing home, with the goal of adjusting the rate of reimbursement according to the patient's condition and the level of care they require. This system helps in establishing a per diem rate for reimbursement purposes.

Question 5

Why was health insurance developed?

Accepted Answer

Health insurance was developed to provide protection to individuals in the event they required health care, similar to how homeowner's insurance or life insurance offers financial protection against specific risks.

Question 6

Flexible spending accounts (FSA)provide employees with the option of setting aside pretax income to pay for out of pocket medical expenses. Employees must submit claims for these expenses and are reimbursed from their spending accounts. The drawback is that the amount set aside must be spent within one year.

Accepted Answer

Flexible Spending Accounts (FSAs) allow employees to set aside money from their paycheck before taxes to use for eligible medical expenses. However, funds in an FSA typically must be used within the plan year, with some plans offering a short grace period or allowing a small amount to be carried over into the next year, but the general rule is "use it or lose it" within one year.

Question 7

Most insurance policies require a monetary contribution from the covered individual which is called:

Accepted Answer

All three terms refer to different types of monetary contributions that an insured individual may be required to pay as part of their insurance policy. A copayment is a fixed amount paid for a covered service, a deductible is an amount the insured must pay before insurance begins to cover costs, and coinsurance is a percentage of the cost of a covered healthcare service that the insured pays after the deductible has been met.

Question 8

Nearly 60% of Medicare enrollees are male, which corresponds to the longer life expectancy of a U.S. male.

Accepted Answer

The majority of Medicare enrollees are female, reflecting the longer life expectancy of women compared to men in the U.S.

Question 9

In a managed care organization, the organization reimburses the provider at a ___________

Accepted Answer

The answer of In a managed care organization, the organization...

Question 10

Most insurance policies require a contribution from the covered individual which may be a copayment, deductible or coinsurance which is called cost participation.

Accepted Answer

The answer of Most insurance policies require a contribution from...

Question 11

Accountable care organizations (ACOs)are groups of providers and hospitals who volunteer to give coordinated care to Medicare patients.

Accepted Answer

ACOs are indeed groups of doctors, hospitals, and other healthcare providers, who come together voluntarily to provide coordinated high-quality care to their Medicare patients. This coordination aims to ensure that patients, especially the chronically ill, get the right care at the right time, while avoiding unnecessary duplication of services and preventing medical errors.

Question 12

A recent trend in health insurance plans is consumer driven health plans which are tax advantage plans with high deductible coverage. The most common CDHPs are health reimbursement arrangements (HRAs)and health savings accounts (HSAs).

Accepted Answer

Consumer-driven health plans (CDHPs) indeed include health reimbursement arrangements (HRAs) and health savings accounts (HSAs), which are designed to give consumers more control over their healthcare spending and encourage them to shop for the best value. These plans typically have higher deductibles but offer tax advantages to offset healthcare costs.

Question 13

Medicare is a program based on an individual's income.

Accepted Answer

Medicare is primarily based on age (65 and older), disability status, or having certain conditions like End-Stage Renal Disease (ESRD), not on an individual's income.

Question 14

The most common type of prospective reimbursement is a service benefit plan which is used primarily by managed care organizations.

Accepted Answer

Service benefit plans are the most common type of prospective reimbursement and are used by managed care organizations to pay for healthcare services.

Question 15

A company who provides their own health insurance will purchase reinsurance from another insurance company to protect themselves from any catastrophic losses. The reinsurance sets a stop loss measure that limits the amount the company will pay for claims.

Accepted Answer

Reinsurance is a practice where insurance companies purchase insurance policies from other insurers to limit their own risk of catastrophic losses. The stop loss measure is a form of reinsurance that sets a threshold, beyond which the reinsurer will cover the excess claims, thus protecting the original insurer (in this case, the company providing its own health insurance) from significant financial impact.

Question 16

Medicare Part B is also referred to as Medicare Advantage and it can be considered a managed care model.
Medicare Part C

Accepted Answer

Medicare Part B is actually medical insurance that covers doctor's services, outpatient care, and other medical services. Medicare Advantage is referred to as Medicare Part C, which is a managed care model offered by private companies approved by Medicare.

Question 17

Managed care plans are a type of health program that combines administrative
costs and service costs for cost control.

Accepted Answer

Managed care plans are designed to reduce unnecessary healthcare costs through a variety of mechanisms, including negotiating lower prices with providers, providing incentives for patients to use care efficiently, and managing the use of healthcare services to ensure that the provided care is necessary, thereby combining both administrative and service costs for better cost control.

Question 18

Medicare is an entitlement program because people, after paying into the program for years, are entitled to receive benefits.

Accepted Answer

Medicare is considered an entitlement program because individuals become eligible to receive its benefits primarily by paying into the system through payroll taxes during their working years, thus entitling them to Medicare coverage typically upon reaching age 65 or under certain conditions if they are younger.

Question 19

Medicare Part B is primarily financed from payroll taxes and is considered hospital insurance.
Medicare Part A

Accepted Answer

Medicare Part A is primarily financed through payroll taxes and is considered hospital insurance, while Medicare Part B is mainly funded through premiums and general revenue and covers outpatient services.

Question 20

Self funded or self insurance programs are health insurance programs that are implemented and controlled by the company itself. They retain all of the risk in providing health insurance to their employees by paying any claims from their employees. Both the employee and employer pay into the fund.

Accepted Answer

Self-funded or self-insurance programs are indeed health insurance schemes where the employer assumes the direct risk for payment of the claims for benefits. The company pays for out-of-pocket claims from a designated fund, into which both the employee and employer may contribute, rather than purchasing a fixed health insurance policy from an external carrier.

Quiz 8: Healthcare Financing