Michigan Nursing Home Administrator (NHA) Practice Exam

What is the annual adjustment limit for benefits after the second anniversary of the date of injury?

1. 3%

2. 5%

3. 7%

4. 10%

The correct answer is: 5%

The correct answer is based on the regulations governing the adjustment of benefits after a specified period following an injury. In many jurisdictions, an annual adjustment limit of 5% is standard for benefits to account for inflation and cost-of-living increases after the second anniversary of the date of injury. This adjustment is intended to ensure that the benefits remain relevant and sufficient over time, maintaining their purchasing power as living expenses increase. The rationale for a 5% cap is to provide a balance between ensuring beneficiaries are fairly compensated in light of changing economic conditions while also maintaining sustainability in benefit programs. Other higher percentages, like 7% or 10%, may imply a more aggressive approach to adjustments that can lead to increased financial strain on the administered funds, if not managed carefully. Thus, the 5% figure strikes an appropriate compromise between these considerations.