CPB (Certified Professional Biller) Certification Practice Exam

Which act is referred to by the acronym ERISA?

1. Electronic Remittance Advice

2. Employee Retirements Income and Security Advisory

3. Employee Retirements income security Act of 1974

4. Extensive Regulation for Insurance and Securities Acts

The correct answer is: Employee Retirements income security Act of 1974

The acronym ERISA stands for the Employee Retirement Income Security Act of 1974. This federal law was established to set minimum standards for pension plans in private industry, ensuring that employees receive the retirement benefits they are promised. It provides a framework that protects the interests of employee benefit plan participants and their beneficiaries by regulating the disclosure of financial information, fiduciary responsibilities, and reporting requirements. Understanding ERISA is essential for those in the billing and coding fields, as it influences how retirement plans and related benefits are managed and reported. The other choices provided do not accurately define ERISA or are entirely fabricated, which solidifies that the correct answer is indeed the Employee Retirement Income Security Act of 1974.