Question

Roger Strader works for a small manufacturing company and is married to Amy, who were high school sweethearts and are both currently 64 years old. He receives an annual salary of $80,000 and Amy works as an administrative assistant at a law firm and makes $30,000 annually. Amy has medical coverage through her employer and Roger’s company purchased health insurance for each of their employees. The plan is a PPO with a $2,000 deductible, 80% co-insurance, $25 office copays, pharmacy benefits and a maximum out of pocket limit of $7,000. It is an ACA plan and provides free preventive health services that Roger routinely utilizes.

One day as Roger was cutting a tree limb from a tree in his yard, he slipped and the chain saw fell on his leg. Roger was rushed to the local hospital where he underwent surgery, and then spent 15 days in the hospital. The ride in the ambulance cost $1,000. Surgery and anesthesia were $45,000; hospital room and board cost $800 per day. Drugs and rehabilitative care came to $15,000. How much of Roger's medical bills will be paid under his insurance policy and how much must he pay personally?

Summary:

PPO Insurance Plan Benefits:

Deductible- $2,000

Coinsurance- 80%

Room & Board- $800 per day

Out of Pocket Max- $7,000

Lifetime Max- Unlimited

Expenses:

Ambulance- $1,000

S & A- $45,000

Room & Board- $800 per day x 15 = $12,000

Drugs & Rehab- $7,000

Total: $73,000

If Roger’s plan was an HSA with the following benefits, how much would he have to pay and what would the insurance company pay?

HSA Insurance Plan Benefits:

Deductible- $4,000

Coinsurance- 100%

Lifetime Max- Unlimited

Answer 1

	Actual Expenses	covered by (PPO)	paid by Roger
		80%	20%
Ambulance- $1,000	1000	800	200
S & A- $45,000	45000	36000	9000
Room & Board- $800 per day x 15 = $12,000	12000	12000	0
Drugs & Rehab- $7,000	15000	12000	3000
TOTAL	73000	60800	12200
Deductibles		-2000	2000
Payable by each party		58,800	14,200

With HSA plan with deductibles of $ 4000 and 100% co insurance , Roger would have paid only $ 4000 from his pocket and balance $ 69,000 would have been paid by the Insurer.Of course this would depend on the fine print of exclusions ....which is not clear in the question