Health & Welfare Benefit Design Flashcards

Under the Women's Health and Cancer Rights Act (WHCRA), group health plans that cover mastectomies must also cover:

Answer: Breast reconstruction and prostheses in connection with mastectomy

WHCRA requires plans covering mastectomies to also cover reconstruction, prostheses, and treatment for physical complications, with parity to other covered benefits.

A 'spousal carve-out' provision in a health plan is designed to:

Answer: Require spouses with access to their own employer coverage to enroll there first or pay a surcharge

Spousal carve-outs (or surcharges) shift spouses who have other group coverage available back to that coverage, reducing the employer's dependent healthcare costs.

Which law requires employers with 15 or more employees to provide reasonable accommodations for pregnancy, childbirth, or related medical conditions?

Answer: Pregnant Workers Fairness Act (PWFA)

The PWFA (effective June 2023) requires covered employers to provide reasonable accommodations for pregnancy-related conditions, closing a gap between Title VII and ADA protections.

A plan sponsor reviewing its Summary Plan Description (SPD) obligations under ERISA must provide the SPD to new participants within:

Answer: 90 days of becoming covered under the plan

ERISA requires that new plan participants receive the SPD within 90 days of becoming covered, with updates furnished within 210 days after the end of the plan year in which changes occur.

In benefits design, an 'embedded' deductible means:

Answer: Each family member has an individual deductible within the family deductible

An embedded deductible allows each covered family member to satisfy an individual deductible amount before the plan pays for that member, even if the family aggregate hasn't been met.

Which of the following best describes the purpose of aggregate stop-loss insurance in a self-funded plan?

Answer: Protects the employer if total plan claims exceed a set percentage of expected claims

Aggregate stop-loss reimburses the employer when total plan-year claims exceed a threshold (typically 110–125% of expected claims), protecting against higher-than-anticipated overall utilization.

When designing a voluntary benefit portfolio, the MOST critical factor for achieving broad employee participation is:

Answer: Ensuring benefits address diverse workforce needs across life stages

A workforce-relevant mix of voluntary benefits that spans different life stages and demographics drives participation because employees see personal value in the offerings.