In order to make premiums more affordable for their customers, Leroux Health Insurance is considering some changes to one of the plans they offer. Both the current options and proposed changes are outlined in the charts below.

Question

Leroux Health Insurance
Plan A
Proposed Changes
Cost:

Monthly Premium:
$248.00
$203.00
Annual Deductible:
$ 5,500.00
$8,500.00

Co-pays:

Brand-name Prescriptions
$35.00
$30.00
Generic Prescriptions
$15.00
$10.00

Visits:

Primary Care Physician:
$40.00
$30.00
Specialist:
$60.00
$45.00
Urgent Care:
$125.00
$90.00
Emergency Room:
$325.00
$250.00

If Kevin is currently insured under Leroux for his medical insurance under Plan A, how will the proposed changes affect his health care costs?
a.
Costs for regularly scheduled health care will go down, but Kevin may end up paying more if he finds himself seriously ill or injured.
b.
Costs for regularly scheduled health care will go up, but Kevin will probably pay less than he would have if he finds himself seriously ill or injured.
c.
Both the cost for regularly scheduled health care and the cost for emergency health care will go down, making the changes very good for Kevin.
d.
Both the cost for regularly scheduled health care and the cost for emergency health care would go up, contradicting the intentions of Leroux Insurance.

Answer 1

To evaluate how the proposed changes will affect Kevin's healthcare costs under Leroux Health Insurance's Plan A, let's analyze both the current plan and the proposed modifications.

1. Monthly Premium Change:

   • Current: $248.00
   • Proposed: $203.00
   • Analysis: The monthly premium decreases, which is a cost-saving change.

2. Annual Deductible Change:

   • Current: $5,500.00
   • Proposed: $8,500.00
   • Analysis: The deductible increases significantly. This means Kevin will have to pay more out-of-pocket before the insurance starts covering costs.

3. Co-pays for Regular Medical Visits:

   • Primary Care Physician: Decreases from $40.00 to $30.00
   • Specialist: Decreases from $60.00 to $45.00
   • Urgent Care: Decreases from $125.00 to $90.00
   • Analysis: Co-pays for regularly scheduled healthcare visits decrease, which means lower out-of-pocket costs for these visits.

4. Co-pays for Prescription Medications:

   • Brand-name Prescriptions: Decreases from $35.00 to $30.00
   • Generic Prescriptions: Decreases from $15.00 to $10.00
   • Analysis: Co-pays for prescriptions also decrease, leading to further cost reductions.

5. Emergency Room Co-pay:

   • Current: $325.00
   • Proposed: $250.00
   • Analysis: The emergency room visit cost decreases, which is better for Kevin in case he needs emergency care.

Summary:

• The proposed changes lead to lower monthly premiums, lower co-pays for regular medical care and prescription drugs, and lower emergency room costs.
• However, the increase in the annual deductible means that if Kevin faces serious illness or injury, he will need to pay more out-of-pocket before insurance coverage kicks in.

Given this analysis, the correct option would be:

a. Costs for regularly scheduled health care will go down, but Kevin may end up paying more if he finds himself seriously ill or injured.