Benefits Design & Administration Flashcards
7 cards from real CCP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Benefits Design & Administration flashcards as text
Under the Mental Health Parity and Addiction Equity Act (MHPAEA), employer-sponsored health plans must ensure that mental health and substance use disorder benefits are:
Answer: No more restrictive than medical/surgical benefits
MHPAEA requires that financial requirements and treatment limitations for mental health/substance use disorder benefits be no more restrictive than those applied to comparable medical and surgical benefits.
What is a key advantage of a defined contribution plan over a defined benefit plan from an employer's perspective?
Answer: Investment risk is transferred to the employee
In a defined contribution plan, the employer's obligation ends with making contributions; employees bear the investment risk, which reduces the employer's long-term liability.
Which approach to benefits benchmarking compares an organization's benefit costs and offerings against competitors in the same industry and labor market?
Answer: Total compensation benchmarking
Total compensation benchmarking includes salary plus all benefits, allowing organizations to assess competitive positioning across all components of the rewards package.
Which federal law governs the portability, nondiscrimination, and renewability provisions for group health insurance?
Answer: HIPAA
HIPAA (Health Insurance Portability and Accountability Act) established rules for health coverage portability, limits on pre-existing condition exclusions, and nondiscrimination in group health plans.
In a self-funded health plan, which financial tool does an employer typically purchase to limit liability for catastrophic individual claims?
Answer: Stop-loss insurance
Stop-loss insurance protects self-funded employers by reimbursing claims that exceed a specified threshold (specific stop-loss) or aggregate annual claims beyond a set amount.
A company wants to offer a voluntary benefit that allows employees to purchase additional life insurance without medical underwriting during open enrollment. This is best described as:
Answer: Guaranteed issue life insurance
Guaranteed issue life insurance allows eligible employees to enroll up to a specified coverage amount without providing evidence of insurability, making it accessible during open enrollment.
Under the Affordable Care Act (ACA), large employers (50+ FTEs) that fail to offer minimum essential coverage to full-time employees may be subject to which penalty?
Answer: Employer Shared Responsibility Payment
The ACA's Employer Shared Responsibility provisions (pay-or-play) impose the Employer Shared Responsibility Payment on applicable large employers that do not offer qualifying coverage and have at least one full-time employee who receives a premium tax credit.