Kristen has an individual medical expense policy with a $1,000 calendar-year deductible,a $5,000 out-of-pocket limit,and a 20 percent coinsurance requirement.Kristen was hospitalized for a surgical procedure in March,her first health care treatment received during the year.The total bill was $20,000.Considering the deductible and coinsurance,how much of this amount must Kristen pay?

Question

Quizplus · Accepted Answer

First, Kristen needs to pay her $1,000 calendar-year deductible. This leaves a balance of $19,000. 
Next, the coinsurance requirement is 20 percent, so Kristen is responsible for paying 20 percent of the remaining balance ($19,000 - $1,000 = $18,000). 
20 percent of $18,000 is $3,600. 
Adding the deductible ($1,000) and the coinsurance ($3,600) together, Kristen must pay a total of $4,600. However, her out-of-pocket limit is $5,000, so she will only need to pay $4,800. Therefore, the correct answer is B.

Kristen Has an Individual Medical Expense Policy with a $1,000