Out-of-pocket plan costs

Oscar Wang was seriously injured in a snowboarding accident that broke both his legs and an arm. His medical expenses included four days of hospitalization at $800 a day, $4,700 in surgical fees, $6,400 in physician's fees (including time in the hospital and six follow-up office visits), $360 in prescription medications, and $1,500 for physical therapy treatments. All of these charges fall within customary and reasonable payment amounts.

1. If Oscar had an indemnity plan that pays 80 percent of his charges with a $1,000 deductible and a $5,000 stop-loss provision, how much would he have to pay out of pocket? Round the answer to the nearest dollar.

   $ _____

2. What would Oscar's out-of-pocket expenses be if he belonged to an HMO with a $30 co-pay for office visits? Assume there are no other out-of-pocket costs. Round the answer to the nearest dollar.

   $ _____

3. Monthly premiums are $255 for the indemnity plan and $375 for the HMO. If he has no other medical expenses this year, which plan provides more cost-effective coverage for Oscar?

   ___________ Select: (HMO/Indemnity Plan)