Benefits Administration and Strategy Flashcards
6 cards from real CBP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Benefits Administration and Strategy flashcards as text
What is a 'private exchange' in the context of employer-sponsored benefits?
Answer: An employer-sponsored or vendor-operated online platform where employees choose benefits from multiple carriers using defined employer contributions
A private exchange is a commercial (non-government) benefits marketplace that allows employees to choose from multiple plan options using a fixed employer-defined contribution, shifting some decision-making to employees.
What is the strategic value of a 'defined contribution' approach to benefits?
Answer: It gives the employer cost certainty by providing a fixed dollar amount while employees choose their own benefits
A defined contribution benefits strategy fixes the employer's financial exposure by setting a specific dollar amount per employee, allowing employees to allocate that amount across benefit options of their choosing.
Which technology system serves as the single source of truth for employee benefit elections, eligibility, and enrollment data?
Answer: Benefits Administration System (BAS) or HRIS
A Benefits Administration System (BAS) or integrated HRIS maintains the authoritative record of employee eligibility, enrollments, life events, and benefit elections across all plans.
What is the primary risk of poor data quality in benefits administration systems?
Answer: Incorrect eligibility, coverage, or premium data leading to claim denials, compliance failures, and financial errors
Poor benefits data quality can cause employees to be enrolled in the wrong plans, pay incorrect premiums, experience denied claims, and expose the employer to ERISA compliance violations.
What is a 'dependent eligibility audit' used for in benefits management?
Answer: Confirming that individuals enrolled as dependents on the health plan actually qualify under plan rules
A dependent eligibility audit verifies that all individuals enrolled as dependents (spouses, children) meet the plan's eligibility criteria, removing ineligible dependents to reduce costs and legal exposure.
Which of the following best describes the role of a Third-Party Administrator (TPA) in a self-funded health plan?
Answer: Processes claims, manages provider networks, and handles plan administration on behalf of the self-funded employer
A TPA administers claims processing, utilization review, network access, and compliance functions for self-funded plans, but the employer retains the financial risk for claims.