Question

Barry has a medical plan with a $1,200 deductible, 20% coinsurance, and a $5,000 coinsurance cap. His allowable medical expenses during the past year are $18,000. How much of this amount will he have to pay out of pocket

Answer 1

Based on his deductible and coinsurance cap, the amount that Barry will pay is $4,560.

Amount Barry will pay

Barry will have to pay the entire deductible of $1,200. The expenses that are left will then be shared between him and the insurer in a 20% - 80% ratio but he will not pay more than $5,000.

Total he will pay out of pocket is therefore:

= Deductible + ( 20% x (Medical expenses - deductible))

Solving gives:

= 1,200 + ( 20% x (18,000 - 1,200))

= $4,560

In conclusion, he will pay $4,560.

Find out more on insurance payments at brainly.com/question/25973180.