A Stop-Loss Contract May Provide That Claims Are Settled Using

question 76

Multiple Choice

A stop-loss contract may provide that claims are settled using a paid claims method or an incurred claims method. The Concord Company provides health coverage to its employees through a selffunded health plan. On March 17, a Concord employee who is enrolled in this plan underwent surgery, and the surgery was sufficiently expensive to trigger Concord's specific stop-loss coverage. On April 10, Concord paid the medical expenses associated with the surgery. The term of the stop-loss contract ended on April 1. This information indicates that the stop-loss carrier is responsible for paying a portion of the cost of the surgery under

• A) both the paid claims method and the incurred claims method
• B) the paid claims method but not the incurred claims method
• C) the incurred claims method but not the paid claims method
• D) neither the paid claims method nor the incurred claims method

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Definitions:

Reinforcers

Stimuli that increase the likelihood of a behavior being repeated through positive or negative reinforcement.

Successive Approximation

A process used in behavior therapy and conditioning that rewards closer and closer behaviors towards a desired goal.

Shaping Behavior

A process of reinforcing successive approximations to a desired behavior, gradually leading to the acquisition of the target behavior.

Self-actualization

The realization or fulfillment of one’s talents and potentialities, regarded as a drive or need present in everyone.