Question 1

Medicare Part A is primarily funded through payroll taxes, which is why most enrollees pay no monthly premium for it. Which type of care does Part A primarily cover?

Accepted Answer

Part A is the hospital insurance portion of Medicare and covers inpatient hospital stays, skilled nursing facility care, hospice, and some home health care. It is mostly premium-free because it was funded by payroll (FICA) taxes during the worker's employment.

Question 2

A 66-year-old wants coverage for physician services and outpatient care under Original Medicare. Which statement about Medicare Part B is correct?

Accepted Answer

Part B is the medical insurance portion covering physician services, outpatient care, and durable medical equipment. Enrollment is voluntary and requires the beneficiary to pay a monthly premium.

Question 3

Which of the following describes a Medicare Part A benefit period?

Accepted Answer

A benefit period starts the day a beneficiary is admitted as an inpatient and ends after they have been out of the hospital or skilled nursing facility for 60 consecutive days. There is no limit to the number of benefit periods a person may have.

Question 4

Medicare Part C (Medicare Advantage) is best described as which of the following?

Accepted Answer

Medicare Advantage (Part C) allows beneficiaries to receive their Part A and Part B benefits through private, Medicare-approved insurance companies. These plans often bundle extra benefits such as prescription drugs, dental, or vision.

Question 5

Which part of Medicare provides prescription drug coverage?

Accepted Answer

Part D is the prescription drug benefit of Medicare, provided through private insurers approved by Medicare. It helps cover the cost of outpatient prescription medications.

Question 6

Medicare Supplement (Medigap) policies sold today are standardized and identified by which of the following?

Accepted Answer

Medigap plans are standardized and labeled with letters (A, B, C, D, F, G, K, L, M, N). Because benefits are standardized by law, a given lettered plan offers the same core benefits regardless of which insurer sells it.

Question 7

The Medicare Supplement (Medigap) open enrollment period is a 6-month window during which an applicant cannot be denied coverage for health reasons. When does this period begin?

Accepted Answer

The Medigap open enrollment period begins on the first day of the month in which the applicant is age 65 or older AND enrolled in Medicare Part B, lasting 6 months. During this window, insurers must issue a policy on a guaranteed-issue basis regardless of health.

Question 8

A retiree needs help paying for ongoing custodial care in a nursing home. Which statement is accurate regarding Medicare?

Accepted Answer

Medicare is designed for acute and skilled care needs, not long-term custodial care. Because Medicare does not cover ongoing custodial care, individuals typically rely on long-term care insurance or Medicaid for that expense.

Question 9

Which of the following best characterizes Medicaid?

Accepted Answer

Medicaid is a needs-based (welfare) program funded jointly by the federal and state governments. Eligibility depends on financial need, so applicants must meet income and asset limits.

Question 10

Long-term care policies typically classify care by level. Which sequence correctly lists the levels from the highest level of medical care to the lowest?

Accepted Answer

Skilled nursing care is the highest level, requiring 24-hour care ordered by a physician and delivered by medical professionals. Intermediate care is occasional nursing or rehabilitative care, and custodial care is basic assistance with daily living that requires no medical training.

Question 11

Under a tax-qualified long-term care insurance policy, which of the following is a standard benefit trigger for receiving benefits?

Accepted Answer

Benefits under a tax-qualified LTC policy are triggered when the insured cannot perform at least two of the six activities of daily living (ADLs) or suffers a severe cognitive impairment. The six ADLs are bathing, dressing, eating, toileting, transferring, and continence.

Question 12

An applicant purchasing long-term care insurance at age 55 is concerned that a fixed daily benefit will not keep pace with rising care costs over the next 20 years. Which policy feature directly addresses this concern?

Accepted Answer

Inflation protection increases the policy's daily or monthly benefit amount over time to help the coverage keep pace with the rising cost of care. This is especially important for younger buyers who may not use benefits for many years.

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