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Max Age 28 Is Insured Under An Individual Medical Expense

Max, age 28, has a PPO medical insurance plan with a $1,000 deductible, 75% coinsurance, and $2,000 out-of-pocket maximum. He had knee surgery and incurred $16,400 in expenses. The insurance company will pay 75% of costs after the deductible is met. Max will have to pay $1,000 deductible plus 25% of remaining costs up to $2,000 out-of-pocket maximum. Surgeon fees from an out-of-network provider would not be covered.

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Amit Pandey
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155 views

Max Age 28 Is Insured Under An Individual Medical Expense

Max, age 28, has a PPO medical insurance plan with a $1,000 deductible, 75% coinsurance, and $2,000 out-of-pocket maximum. He had knee surgery and incurred $16,400 in expenses. The insurance company will pay 75% of costs after the deductible is met. Max will have to pay $1,000 deductible plus 25% of remaining costs up to $2,000 out-of-pocket maximum. Surgeon fees from an out-of-network provider would not be covered.

Uploaded by

Amit Pandey
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Solved: Max age 28 is insured under an individual medical

expense

Max, age 28, is insured under an individual medical expense policy that is part of a preferred
provider organization (PPO) network. The policy has a calendar- year deductible of $1,000,
75/25 percent coinsurance, and an annual out-of-pocket limit of $2,000. Max recently had
outpatient arthroscopic surgery on his knee, which he injured in a skiing accident. The surgery
was performed in an outpatient surgical center. Max incurred the following medical expenses.
(Assume that the charges shown are the charges approved by Max's insurer and that all
providers are in the PPO network.)

Outpatient X-rays and diagnostic tests................................................ $800

Covered charges in the surgical center ................................................ $12,000

Surgeon's fee.............................................................................. $3,000

Outpatient prescription drugs............................................................ $400

Physical therapy expenses ............................................................... $1,200

In addition, Max could not work for 2 weeks and lost $2,000 in earnings.

a. Based on the given information, how much of the expenses will be paid by the insurance
company?

b. How much of the expenses will Max have to pay? Explain your answer.

c. Assume that a surgeon who is not in the PPO network actually performed the surgery. Will
Mark's policy cover this fee? Explain your answer.

Max age 28 is insured under an individual medical expense

ANSWER
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