Don and Kasey Johnson are a married couple. They are both 30 years old and they have a 3-year-old girl. Don is a loan officer and earns $75,000 a year. Kasey works as a retail store manager and earns $45,000 a year. Don's life expectancy is 80 years and Kasey's 82. They plan on retiring when they are 65. There are three health insurance policies that they could choose from (see page 3-5). 1. Health Insurance: a. Help Don and Kasey to determine which of the three plans to choose. They want to know which plan would be best if they estimate their medical costs at approximately $2,500 per year and which plan to use if they estimate their medical costs closer to $25,000 per year. Help the Johnsons determine how much of their risk they should transfer and how much they should retain (for example a higher deductible means they are retaining more risk). High Medial Expenses (-$25,000/year) Low Medical Expenses (~$2,500/year) FirstCare FirstCare Blue Bronze Choice Gold Gold FirstCare Bronze FirstCare Gold Blue Choice Gold Estimated Medical Cost: Out of Pocket Expenses: Annual Premium: Total Cost: Which plan should they choose? And Why? b. Now suppose you are choosing the insurance for yourself. Based on your own situation, what is your annual medical cost and which insurance are you going to choose based on your family, history, lifestyle, etc.? Why? 2. Life Insurance: a. What type of life insurances the Johnsons get? Term Life Insurance Cash-Value Whole Life Insurance None b. Explain your reasoning: 3. Disability Insurance: a. What type of disability insurance should the Johnsons get? Disability Insurance Coverage for Don: Short Term Disability Insurance Coverage for Kasey: Short Term Long Term Long Term None None b. Explain your reasoning: 4. Long-Term Care Insurance: a. Should the Johnsons get long-term care insurance? Yes o No b. Explain your reasoning:/ FirstCare 7 HEALTH PLANS FirstCare Health Plans Bronze Firstcare Health Plans HMO Monthly Cost $209.97 FirstCare FirstCare Health Plans Gold Firstcare Health Plans 7 HEALTH PLANS HMO Monthly Cost $271.26 Deductible Deductible $4,500 30% Premium: $209.97 Subsidy: $0.00 Premium: $271.26 Subsidy: $0.00 Coinsurance Coinsurance 20% $6,350 Out of Pocket Maximum $6,350 Out of Pocket Maximum More Details Find a Provider More Details Find a Provider Out of Network Out of Network In Network $0 20% $6,350 $12,700 In Network + Out of Network Out of Network $30 $50 $0 $0 $300 copay Deductibles and Cost Sharing Deductible (Individual) Deductible (Family) Coinsurance Out of Pocket Maximum (Individual) Out of Pocket Maximum (Family) Services Primary Care Visit Specialist Visit In Patient Hospital Services Emergency Room Services Mental / Behavioral Health Imaging (CT/PET Scans, MRI) Rehabilitative Speech Therapy Rehabilitative Occupational & Physical Therapy Preventative Care Laboratory Outpatient and Professional Services 20% $250 Deductibles and Cost Sharing In Network Deductible (Individual) $4,500 Deductible (Family) $10,000 Coinsurance 30% Out of Pocket Maximum (Individual) $6,350 Out of Pocket Maximum (Family) $12,700 Services In Network Primary Care Visit $60 Specialist Visit $70 Copay after deductible In Patient Hospital Services 30% Coinsurance after deductible Emergency Room Services $300 Copay after deductible Mental / Behavioral Health $70 copay Imaging (CT/PET Scans, MRI) 30% coinsurance Rehabilitative Speech Therapy $70 copay Rehabilitative Occupational & $70 copay Physical Therapy Preventative Care $0 Laboratory Outpatient and $0 Professional Services X-ray and Diagnostic Imaging 30% coinsurance Prescription Drugs In Network Generic Rx $20 Copay after deductible Preferred Brand Rx $50 Copay after deductible Non Preferred Brand Rx $70 Copay after deductible Specialty Drugs 30% Coinsurance after deductible $250 copay $50 copay 20% coinsurance $50 copay $50 copay $0 Out of Network Out of Network X-ray and Diagnostic Imaging Prescription Drugs Generic Rx Preferred Brand Rx Non Preferred Brand Rx Specialty Drugs In Network $20 $50 $70 20% Monthly Cost BlueCross Blue Choice Gold PPO 002 Blue Cross Blue Shield of Texas . V. BlueShield $333.69 PPO Deductible $1,500 20% Premium: $333.69 Subsidy: $0.00 Coinsurance Out of Pocket Maximum More Details Find a Provider $3,500 In Network Out of Network $3,000 $9,000 40% Deductibles and Cost Sharing Deductible (Individual) Deductible (Family) Coinsurance Out of Pocket Maximum (Individual) Out of Pocket Maximum (Family) Services Primary Care Visit Specialist Visit $1,500 $4,500 20% $3,500 $10,500 In Network $10 $60 $200 Copay per Stay and 20% Coinsurance $400 Copay and 20% Coinsurance a $7,000 $21,000 Out of Network 40% coinsurance 40% coinsurance In Patient Hospital Services 40% coinsurance Emergency Room Services $10 copay 20% coinsurance 20% coinsurance 20% coinsurance after $400 copay/visit 40% coinsurance 40% coinsurance 40% coinsurance 20% coinsurance 40% coinsurance $0 40% coinsurance Mental / Behavioral Health Imaging (CT/PET Scans, MRIS) Rehabilitative Speech Therapy Rehabilitative Occupational & Physical Therapy Preventative Care Laboratory Outpatient and Professional Services X-ray and Diagnostic Imaging Prescription Drugs Generic Rx Preferred Brand Rx Non Preferred Brand Rx Specialty Drugs 20% coinsurance 40% coinsurance 40% coinsurance Out of Network 20% coinsurance In Network No Charge $35 $75 $150 Don and Kasey Johnson are a married couple. They are both 30 years old and they have a 3-year-old girl. Don is a loan officer and earns $75,000 a year. Kasey works as a retail store manager and earns $45,000 a year. Don's life expectancy is 80 years and Kasey's 82. They plan on retiring when they are 65. There are three health insurance policies that they could choose from (see page 3-5). 1. Health Insurance: a. Help Don and Kasey to determine which of the three plans to choose. They want to know which plan would be best if they estimate their medical costs at approximately $2,500 per year and which plan to use if they estimate their medical costs closer to $25,000 per year. Help the Johnsons determine how much of their risk they should transfer and how much they should retain (for example a higher deductible means they are retaining more risk). High Medial Expenses (-$25,000/year) Low Medical Expenses (~$2,500/year) FirstCare FirstCare Blue Bronze Choice Gold Gold FirstCare Bronze FirstCare Gold Blue Choice Gold Estimated Medical Cost: Out of Pocket Expenses: Annual Premium: Total Cost: Which plan should they choose? And Why? b. Now suppose you are choosing the insurance for yourself. Based on your own situation, what is your annual medical cost and which insurance are you going to choose based on your family, history, lifestyle, etc.? Why? 2. Life Insurance: a. What type of life insurances the Johnsons get? Term Life Insurance Cash-Value Whole Life Insurance None b. Explain your reasoning: 3. Disability Insurance: a. What type of disability insurance should the Johnsons get? Disability Insurance Coverage for Don: Short Term Disability Insurance Coverage for Kasey: Short Term Long Term Long Term None None b. Explain your reasoning: 4. Long-Term Care Insurance: a. Should the Johnsons get long-term care insurance? Yes o No b. Explain your reasoning:/ FirstCare 7 HEALTH PLANS FirstCare Health Plans Bronze Firstcare Health Plans HMO Monthly Cost $209.97 FirstCare FirstCare Health Plans Gold Firstcare Health Plans 7 HEALTH PLANS HMO Monthly Cost $271.26 Deductible Deductible $4,500 30% Premium: $209.97 Subsidy: $0.00 Premium: $271.26 Subsidy: $0.00 Coinsurance Coinsurance 20% $6,350 Out of Pocket Maximum $6,350 Out of Pocket Maximum More Details Find a Provider More Details Find a Provider Out of Network Out of Network In Network $0 20% $6,350 $12,700 In Network + Out of Network Out of Network $30 $50 $0 $0 $300 copay Deductibles and Cost Sharing Deductible (Individual) Deductible (Family) Coinsurance Out of Pocket Maximum (Individual) Out of Pocket Maximum (Family) Services Primary Care Visit Specialist Visit In Patient Hospital Services Emergency Room Services Mental / Behavioral Health Imaging (CT/PET Scans, MRI) Rehabilitative Speech Therapy Rehabilitative Occupational & Physical Therapy Preventative Care Laboratory Outpatient and Professional Services 20% $250 Deductibles and Cost Sharing In Network Deductible (Individual) $4,500 Deductible (Family) $10,000 Coinsurance 30% Out of Pocket Maximum (Individual) $6,350 Out of Pocket Maximum (Family) $12,700 Services In Network Primary Care Visit $60 Specialist Visit $70 Copay after deductible In Patient Hospital Services 30% Coinsurance after deductible Emergency Room Services $300 Copay after deductible Mental / Behavioral Health $70 copay Imaging (CT/PET Scans, MRI) 30% coinsurance Rehabilitative Speech Therapy $70 copay Rehabilitative Occupational & $70 copay Physical Therapy Preventative Care $0 Laboratory Outpatient and $0 Professional Services X-ray and Diagnostic Imaging 30% coinsurance Prescription Drugs In Network Generic Rx $20 Copay after deductible Preferred Brand Rx $50 Copay after deductible Non Preferred Brand Rx $70 Copay after deductible Specialty Drugs 30% Coinsurance after deductible $250 copay $50 copay 20% coinsurance $50 copay $50 copay $0 Out of Network Out of Network X-ray and Diagnostic Imaging Prescription Drugs Generic Rx Preferred Brand Rx Non Preferred Brand Rx Specialty Drugs In Network $20 $50 $70 20% Monthly Cost BlueCross Blue Choice Gold PPO 002 Blue Cross Blue Shield of Texas . V. BlueShield $333.69 PPO Deductible $1,500 20% Premium: $333.69 Subsidy: $0.00 Coinsurance Out of Pocket Maximum More Details Find a Provider $3,500 In Network Out of Network $3,000 $9,000 40% Deductibles and Cost Sharing Deductible (Individual) Deductible (Family) Coinsurance Out of Pocket Maximum (Individual) Out of Pocket Maximum (Family) Services Primary Care Visit Specialist Visit $1,500 $4,500 20% $3,500 $10,500 In Network $10 $60 $200 Copay per Stay and 20% Coinsurance $400 Copay and 20% Coinsurance a $7,000 $21,000 Out of Network 40% coinsurance 40% coinsurance In Patient Hospital Services 40% coinsurance Emergency Room Services $10 copay 20% coinsurance 20% coinsurance 20% coinsurance after $400 copay/visit 40% coinsurance 40% coinsurance 40% coinsurance 20% coinsurance 40% coinsurance $0 40% coinsurance Mental / Behavioral Health Imaging (CT/PET Scans, MRIS) Rehabilitative Speech Therapy Rehabilitative Occupational & Physical Therapy Preventative Care Laboratory Outpatient and Professional Services X-ray and Diagnostic Imaging Prescription Drugs Generic Rx Preferred Brand Rx Non Preferred Brand Rx Specialty Drugs 20% coinsurance 40% coinsurance 40% coinsurance Out of Network 20% coinsurance In Network No Charge $35 $75 $150