Individual vs. Group Insurance

Question 1

The Individual Market is for…

Answer 1

Individuals and families

Question 2

Individual Market: Who is the policy holder?

Answer 2

Buyer and can choose the policy/plan features

Question 3

Individual Market: Change in employment has…

Answer 3

No impact on coverage

Question 4

Until ACA, shoppers in the individual market could be denied insurance or charged more due to…

Answer 4

Personal health status

Question 5

Applying for individual health insurance traditionally involved…

Answer 5

Some level of medical underwriting

Question 6

Medical Underwriting

Answer 6

Health history and health-related habits, MIB files, Physicals

Question 7

Even if medical underwriting is limited by the ACA in traditional health insurance…

Answer 7

It might still be practiced in disability/LTC markets

Question 8

Individual Underwriting: Community Rating

Answer 8

Price based on collective health/characteristics of the larger population, not the individual

Question 9

Individual Underwriting: Modified Community Rating

Answer 9

Price based on health of community with limited consideration of the individual

Question 10

ACA plans must use modified community rating that only considers…

Answer 10

Family size, tobacco use, age, geography

Question 11

ACA plans cannot use…

Answer 11

Gender and individual health

Question 12

Group Health Insurance covers…

Answer 12

Several people via a “master policy”

Question 13

Group Health: Policyholder is typically…

Answer 13

Employer

Question 14

Group Health: Employee receives…

Answer 14

Certificate of insurance

Question 15

Group Health: Typically can insure…

Answer 15

Employees, spouses, and dependent children

Question 16

Group Health: Employee coverage often paid for by…

Answer 16

Employer and employee

Question 17

Group Health: Dependent coverage often paid for by…

Answer 17

Employee

Question 18

HIPAA prohibits discrimination (price and availability) based on…

Answer 18

Health if joining during open enrollment

Question 19

Open Enrollment

Answer 19

Eligible employees, spouses, and dependents can typically enroll at the start of employment or during one month annual period

Question 20

Open Enrollment: Don’t need to wait for annual period if…

Answer 20

Employee, spouse, or dependent loses other coverage; birth or adoption; marriage

Question 21

Open Enrollment: Traditionally, everyone is eligible regardless of health and often no waiting periods for pre-existing conditions if…

Answer 21

Had creditable coverage within 62 days of applying

Question 22

Group Health Insurance Underwriting

Answer 22

Premiums won’t depend on characteristics of any individual

Question 23

Group Underwriting: Experience-rated

Answer 23

Characteristics of the collective group will be a major impact on price (large group)

Question 24

Group Underwriting: Community-rated

Answer 24

Characteristics of the broader population will be a major impact on price (small group)

Question 25

Self-Insured Groups

Answer 25

Employer pays for employee care with its own funds

Question 26

Self-insured groups are often exempt from...

Answer 26

State insurance laws but still regulated by federal government

Question 27

Self insured groups admin duties are often handled by...

Answer 27

Third party administrator (TPA) or administrative services organization (ASO)

Question 28

Stop-loss insurance might kick in if...

Answer 28

Claims are significantly higher than premiums

Question 29

Coordination of Benefits

Answer 29

Addresses how claims will be paid when covered by multiple plans

Question 30

Coordinating Policies

Answer 30

Take other insurance into account

Question 31

Non-Coordinating Policies

Answer 31

Do not take other insurance into account

Question 32

COB: Individual

Answer 32

Claims are split pro-rata liability

Question 33

Pro-Rata Liability

Answer 33

Big plans pay more, small plans pay less

Question 34

COB: Group

Answer 34

Employee's plan is primary, spouse's plan is secondary

Question 35

COB, Group: Joint Custody

Answer 35

Parent with birthday earliest in the year is primary

Question 36

COB, Group: Not Joint Custody

Answer 36

Custodial parent's coverage is primary for child, unless divorce says otherwise

Question 37

No Loss/No Gain

Answer 37

Applies if employers replace a health plan during the policy period

Question 38

No Loss/No Gain Qualities

Answer 38

No new restrictions on a pre-existing conditions; deductibles paid in same year might need to carry over

Question 39

Contributory Group

Answer 39

Each group member pays at least part of the premium; 75% minimum participation

Question 40

Non-Contributory Group

Answer 40

Plan sponsor pays full premium; 100% participation

Question 41

Contributory/non-contributory groups are done to prevent...

Answer 41

Adverse Selection

Question 42

Blanket Policy

Answer 42

Insurance for non-employer groups that have frequent changes in membership

Question 43

Blanket Policy: Insurer generally doesn't receive...

Answer 43

List of group members

Question 44

Blanket Policy: Group members don't receive...

Answer 44

Certificate of Insurance

Question 45

Blanket Policy: Typically only...

Answer 45

Accident insurance for medical care

Question 46

Employer Taxes

Answer 46

Can typically deduct its own contributions to employee health insurance from its income taxes

Question 47

Patient Taxes

Answer 47

Typically no taxes for benefits

Question 48

Patient Taxes: Premium contributions for group insurance are usually...

Answer 48

Pre-tax, excluded from taxable income so no extra deduction allowed

Question 49

Patient Taxes: Contributions of after-tax dollars for medical care/insurance might be taxable if...

Answer 49

Itemizing your taxes and spending more than 7.5% of income on heath care