Long Term Care Certification Practice Test

Regarding model plans established by the NAIC, which of the following statements is NOT accurate?

1. Once a model is accepted, individual member states are compelled to use it

2. Model plans aim to standardize long-term care policies

3. States can adapt models to fit their specific needs

4. Model plans help in consumer protection

The correct answer is: Once a model is accepted, individual member states are compelled to use it

The statement that individual member states are compelled to use an accepted model plan from the NAIC is not accurate because, while the NAIC (National Association of Insurance Commissioners) provides model laws and regulations, each state has the authority to decide whether to adopt these models. The NAIC develops these models to serve as guidelines for states to enhance consistency and standardization. However, states operate independently and can choose to modify or reject the models based on their unique regulatory environments and specific needs. In contrast, model plans are indeed designed to standardize long-term care policies, which contributes to consistency in offerings across states and can help consumers compare options more easily. Additionally, states utilizing these models can adapt them to better align with their local requirements, allowing flexibility while still adhering broadly to established standards. Finally, model plans are specifically intended to enhance consumer protection by ensuring that policies meet certain minimum standards and thus help safeguard consumers against insufficient coverage or misleading practices.