Health Insurance - What do They Pay? Learning Objective: To be able to calculate the out of pocket cost using several basic insurance plans For the purpose of this assignment, we will be using the three plans shown below. We will also assume that a doctors visit only costs the co-pay. The plans shown below are gross simplifications of actual insurance plans so be careful when it comes to calculating your own medical expenses.

Plan A: Everything has a $20 co-pay. The plan has a $1,000 deductible but pays 100% of expenses after that. This plan also has a yearly limit on total deductible expenses of $2,500. Plan B: Most things have a $10 co-pay. There is a $200 deductible with 80% coinsurance after that. There is no limit on yearly out-of-pocket expenses. There is a co-pay limit of $100 for the year. Plan C: This is a health savings account. There is a $50 co-pay for everything and the account has $40,000 in it.

Left Column below is used to keep track of the yearly limits given above: total deductible limit, co-pay limit, and the amount left in the HAS, respectively.

1. Kip sprains his ankle badly sliding into first base. This involves a doctors visit along with an MRI which costs $3,000. What was paid, and what is left? Show your work.

	Paid by the Plan	Paid Individual	Left
Plan A
Plan B
Plan C

2. Assume each the plans have the following left; Plan A $0, Plan B$0 and Plan C $6,450 prior to the following activity. Lee ends up getting a rare but treatable form of leukemia. He is hospitalized for several months and makes a full recovery. He total medical bills end up being $130,000 and one co-pay.

	Paid by the Plan	Paid Individual	Left
Plan A
Plan B
Plan C

3. Based on your calculations discuss as a group which plan you would expect to be most and least expensive. Explain your reasoning.