79. Many major medical policies include a provision whereby when expenses reach a certain dollar amount, the insured no longer shares in the cost of expenses; the insurer pays 100% of remaining covered charges. This is referred to as the
Answer: D
Stop-loss limit
A stop-loss limit is a provision in many major medical policies that specifies when the insured will no longer share in the cost of expenses. Once the insured's out-of-pocket expenses reach a predetermined dollar amount, the insurer takes over and pays 100% of the remaining covered charges.
A) maximum benefit.
The maximum benefit refers to the highest amount an insurer will pay for a covered service or benefit over a specified period. This option is incorrect in this context as it does not relate to the cost-sharing structure between the insured and the insurer after a certain expense threshold is met.
B) benefit restoration.
Benefit restoration typically involves reinstating benefits that may have been exhausted or depleted. This term does not apply to the scenario described, where the focus is on the cessation of cost-sharing after reaching a certain expense level.
C) coinsurance percentage.
Coinsurance percentage is the portion of costs that the insured is responsible for paying after the deductible has been met. Although related to cost-sharing, this option does not accurately describe the provision where the insurer pays 100% after expenses reach a specified limit.
D) stop-loss limit.
The stop-loss limit is defined as the threshold at which the insured's financial responsibility ends, and the insurer covers all remaining expenses. This term directly corresponds to the provision mentioned in the question, making it the correct choice.
Conclusion
The stop-loss limit is the correct answer as it specifically addresses the provision in medical policies that eliminates the insured's cost-sharing obligations after reaching a certain expense threshold. Other options do not accurately capture this concept, as they refer to different aspects of insurance coverage and cost-sharing arrangements. Thus, understanding the stop-loss limit is crucial for comprehending how financial protection works in major medical policies.