New York Health Insurance Practice Exam Free 2026

• A. What starts premium payments
• B. The criteria that must be met before benefits are paid
• C. What cancels the policy
• D. A device for dispensing medication

Correct answer: B. The criteria that must be met before benefits are paid

Explanation: A benefit trigger is the condition that must be met before long-term care insurance benefits begin. Common triggers include inability to perform a certain number of ADLs or cognitive impairment.

• A. Mental health screening for insurance
• B. Equal premium rates for all members
• C. Equivalent mental and physical fitness
• D. Requiring equal coverage for mental health as for medical/surgical conditions

Correct answer: D. Requiring equal coverage for mental health as for medical/surgical conditions

Explanation: Mental health parity requires health insurers to provide the same level of benefits for mental health and substance use disorder treatment as they do for medical and surgical treatments.

• A. Insurance for community organizations
• B. Rating doctors in the community
• C. Rating insurance companies by community members
• D. Setting premiums based on the entire community rather than individual health status

Correct answer: D. Setting premiums based on the entire community rather than individual health status

Explanation: Community rating is a method of setting premiums where everyone in a geographic area pays the same base rate, regardless of individual health status. The ACA requires modified community rating.

• A. Rating insurance agents' experience
• B. Rating based on customer experience
• C. Rating medical providers' experience
• D. Setting premiums based on a group's actual claims history

Correct answer: D. Setting premiums based on a group's actual claims history

Explanation: Experience rating bases premium rates on the actual claims history and experience of a specific group. Groups with fewer claims may receive lower rates, while those with more claims pay higher rates.

• A. A primary care physician who coordinates and authorizes specialist care
• B. An insurance claims reviewer
• C. A hospital administrator
• D. A security guard at hospitals

Correct answer: A. A primary care physician who coordinates and authorizes specialist care

Explanation: In managed care plans, particularly HMOs, the gatekeeper is the primary care physician who coordinates all patient care and must authorize referrals to specialists to ensure medical necessity and cost control.

• A. Taking medication in steps
• B. Requiring use of less expensive drugs before covering more expensive alternatives
• C. A physical therapy technique
• D. Increasing dosages gradually

Correct answer: B. Requiring use of less expensive drugs before covering more expensive alternatives

Explanation: Step therapy is a cost-control strategy requiring patients to try less expensive, often generic medications first before the plan will cover more expensive brand-name or specialty drugs.

• A. A mathematical calculation for premiums
• B. A list of prescription drugs covered by the plan, often organized by tier
• C. A medical formula for treatment
• D. The policy application form

Correct answer: B. A list of prescription drugs covered by the plan, often organized by tier

Explanation: A formulary is a list of prescription drugs covered by a health insurance plan, typically organized into tiers based on cost. Drugs on the formulary are covered; those off-formulary may not be or have higher costs.

• A. Prior health insurance coverage that reduces or eliminates pre-existing condition exclusions
• B. Coverage with a credit card
• C. Insurance from a credible company
• D. Coverage that earns credit

Correct answer: A. Prior health insurance coverage that reduces or eliminates pre-existing condition exclusions

Explanation: Creditable coverage is prior health insurance coverage that can reduce or eliminate pre-existing condition exclusion periods when switching to new coverage. HIPAA established rules for crediting prior coverage.

• A. A group of risky investments
• B. State programs providing health insurance to individuals unable to obtain coverage elsewhere
• C. A dangerous medical procedure
• D. A swimming pool for athletes

Correct answer: B. State programs providing health insurance to individuals unable to obtain coverage elsewhere

Explanation: High-risk pools are state-sponsored health insurance programs designed to cover individuals who cannot obtain coverage in the private market due to pre-existing conditions. The ACA reduced their need.

• A. Children's Health Insurance Program providing coverage for uninsured children
• B. A claims processing system
• C. A hospital identification system
• D. A computer health program

Correct answer: A. Children's Health Insurance Program providing coverage for uninsured children

Explanation: CHIP (Children's Health Insurance Program) is a federal-state program providing health coverage to uninsured children in families with incomes too high for Medicaid but too low for private insurance.

• A. Selecting adverse weather conditions
• B. Choosing the wrong plan
• C. The tendency for higher-risk individuals to seek more insurance coverage
• D. Negative policy selection by insurers

Correct answer: C. The tendency for higher-risk individuals to seek more insurance coverage

Explanation: Adverse selection occurs when individuals with higher health risks are more likely to purchase insurance, while healthier people may decline coverage, leading to a disproportionate number of claims.

• A. Unethical behavior by insurers
• B. A hazardous moral situation
• C. Insurance fraud
• D. The tendency to use more services because insurance covers them

Correct answer: D. The tendency to use more services because insurance covers them

Explanation: Moral hazard in health insurance is the tendency for insured individuals to use more medical services or take less care of their health because they don't bear the full cost of their decisions.