The mental capacity to understand the consequences of entering a contract. This is required to enter a contract with an insurer.
Insurance Encyclopedia
Competency
This is one of the elements that must be present in order to have a legal contract. It relates to the fitness or ability of either of the parties to the contract. An example of incompetency would be an alcoholic or a mental incompetent.
Competent
Individual able to understand and act sanely and reasonably.
Competitive benchmarking
See: benchmarking.
Competitive bidding
A situation in which an insured requests premium quotations on its insurance program from a number of agents/brokers. In some instances, insureds provide agents/brokers with detailed specifications upon which to base their quotations. Under other circumstances, the agents/brokers present proposals for coverage reflecting their own ideas for structuring the insured’s program.
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A situation in which an insured requests premium quotations on its insurance program from a number of agents/brokers. In some instances, insureds provide agents/brokers with detailed specifications upon which to base their quotations. Under other circumstances, the agents/brokers present proposals for coverage reflecting their own ideas for structuring the insured’s program.
Competitive medical plan (CMP)
1. Established by the Tax Equity and Fiscal Responsibility Act (TEFRA). This is a state-licensed health plan similar to a health maintenance organization (HMO) that delivers comprehensive, coordinated services to voluntary enrolled members on a prepaid, capitated basis. 2. CMP status may be granted by the federal government for the enrollment of Medicare beneficiaries into managed care plans, without having to qualify as an HMO. CMPs with Medicare contracts offer Medicare beneficiaries all services covered by fee-for-service Medicare. Medicare pays these plans on a monthly basis for each Medicare beneficiary. Medicare beneficiaries get all Medicare-covered hospital and medical insurance benefits through the plan. The CMP may also collect a premium from each Medicare member enrolled in the plan.
Competitive pricing
Method that uses market information for establishing payment rates that reflect the costs of an efficient managed care plan or health care provider (e.g., competitive bidding that obtains information on costs through the process of bidding).
Competitive state fund
A facility established by a state to sell workers compensation in competition with private insurers.
Complaint
Expression of dissatisfaction about a certain problem encountered by the member of a managed care plan, or about a decision by the insurance company. A complaint must include a request for action to resolve the problem or change the decision. Also see grievance.
Complaint (of fraud or abuse)
Statement, oral or written, alleging that a provider or beneficiary received a Medicare benefit of monetary value, directly or indirectly, overtly or covertly, in cash or in kind, to which he or she is not entitled under current Medicare law, regulations, or policy. Included are allegations of misrepresentation and violations of Medicare requirements applicable to persons or entities that bill for covered items and services.