Which statement about private health insurance is accurate?

• A. Stock companies are owned by policyholders.
• B. Mutual companies operate nationally and are owned by stockholders.
• C. Non-profit plans operate in a specific region and are subject to specific state regulations.
• D. All private plans require pre-authorization for PT visits.

Answer: (C)

Understanding how private health insurance plans are organized and regulated helps explain why that statement is accurate. For-profit stock companies are owned by investors who hold stock, and profits go to the stockholders. Mutual companies are owned by policyholders, not stockholders, and they can operate in various scopes, but they aren’t owned by investors. Non-profit plans are typically organized to serve a defined geographic region and are regulated by state insurance departments, with licenses, rate approvals, and mandated benefits tied to state rules. That regional focus and state oversight are what make the non-profit option described as operating in a specific region and being subject to state regulations. Pre-authorization requirements for physical therapy visits vary by plan, so saying all private plans require it isn’t accurate.