Question

Joanne has a health insurance plan with a $1000 calendar-year deductible, 80% coinsurance, and a $5,000 out-of-pocket cap Joanne incurs $1,000 in covered medical expenses in March, $3,000 in covered expenses in July, and $30,000 in covered expenses in December. How much does Joanne's plan pay for her July losses?

(Careful: The facts on this Concept Check are the same as in the previous one, but the question asked is different) Joanne has a health insurance plan with a $1000 calendar year deductible, 80% coinsurance, and a $5,000 out-of-pocket cap. Joanne incurs $1,000 in covered medical expenses in March, $3,000 in covered expenses in July, and $30,000 in covered expenses in December How much does Joanne's plan pay for her December losses?

Answer 1

Solution-1
		Amount in $
Step-1	Losses incurred in July	3000
	(Joanne has met her deductible of $ 1000 in March)
	Remaining Coinsurance coverage	3000
Step-2	Losses covered by Joanne (20% of 3000)	600
	Losses covered by Insurer (80% of 3000)	2400
	Hence, Joanne's plan pay for her July losses are	2400
Solution-2
		Amount in $
Step-1	Losses incurred in dec	30000
	(Joanne has met her deductible of $ 1000 in March)
	Remaining Coinsurance coverage	30000
step-2	Losses covered by Joanne [(5000-1000-600) or [(20% of 33000)]-whichever is lower	3400
	Losses covered by Insurer (80% of 30000)	24000
	Hence, Joanne's plan pay for her Dec losses are	24000