Danielle DiMartino is a 32-year-old single mother with one child. Her 8-year-old daughter has a history of ear infec- tions that require doctors office visits four or five times per year. Danielles 70-year-old mother lives with the family for financial reasons; she has hereditary high blood pressure and high cholesterol as well as diabetes. Danielles mother is enrolled in Medicare Parts A and B. Danielles employer pays all or a portion of the cost for a health care plan to cover the companys workers, their spouses, and their dependents. Danielle has four options: (1) the basic HMO managed by a local university medical school/hospital with no additional cost for Danielle, but with an additional cost of $290 per month to cover her children, (2) a health insurance plan with a PPO at that same medical center for a total cost of $380 per month, (3) a traditional health insurance plan that provides access to virtually all health care providers in her community for $490 per month, and (4) a health plan with a $5,000 deductible at no additional cost. Danielles employer offers no disability income or long-term care group plan. She does receive ten sick days per year, which can accumulate if not taken. Danielle has accumulated 30 days.

What do you recommend to Danielle DiMartino on the subject of managing health expenses regarding:

1. Choosing among the four alternatives available to her?

2. Danielles concerns about providing for her mothers health care needs?

3. Danielles need for disability income insurance?

4. How Danielle can cover her long-term care risk?