Question

1. Critics of HMO’s say that :

a) HMO members have too many choices of doctors they can use and service they can receive.

b) HMO doctors waste money because they have no incentive to control costs

c) The 10 % deductible required for every producer is cost prohibitive for most citizens

d) None of the above

2. Granny Mayberry ‘s health insurance policy has a $500 annual aggregate deductible, 80/20 cost sharing deductible, and a $ 5000 maximum annual out of the pocket cap of $5000. She wrecks her Harley and breaks her hip, and her total medical bills for the injury are $12, 890. How much will her insurer pay for this claim?

show calculation please

a) 7,890 b) 10,312 c) 9912 d) 12890

3. Which of the following statements about term insurance is true?

a) the coverage is appropriate if the goals is permanent lifetime protection

b) most policies can be renewed for additional periods without evidence of insurability

c) premiums increase at a constant rate each time the policy is renewed

d) most policies have a cash value that is refunded when coverage cease

Answer 1

Since, multiple questions have been posted, I have answered the first one relating to HMO.

____

None of the above. (which is Option D)

____

Explanation:

HMO provides little flexibility with respect to the type of health plans, coverage and the doctors. Patients are required to obtain approval/referral from their PCP (primary care physician) for visiting any specialist that is on the network of HMO. In other words, patients donot have the freedom to consult any specialist of their own preference. Therefore, Option A is incorrect.

Option B is incorrect because the costs are automatically controlled under HMO. For any kind of treatment, the patient is required to go through a screening process with PCP (primary care physician) who in turn than refers the patient to a specialist on the network of HMO (if there is any need). So, doctors working with HMO have little scope for prescribing overtreatment.

In case of HMO's, there are no deductibles. Therefore, Option C is incorrect.