Question

Select the correct answer. Laura is looking for a way to save money this year on her medical expenses. Insurance is starting to get expensive, and her budget is tight. She figures that she has a 75

1) Keep her health insurance because it is important to have coverage in case of unexpected medical expenses.
2) Drop her health insurance because she has a high chance of staying healthy and it will save her money.
3) Reduce her health insurance coverage to a lower level to save money.
4) Look for alternative health insurance plans that offer lower premiums.

Answer 1

Laura is considering how to save on medical expenses by evaluating her health insurance options, which include keeping, dropping, or reducing her current coverage, or finding an alternative plan. She must balance potential savings against the risk of unexpected health costs and personal health care needs.

Step-by-step explanation:

Laura is examining options to save on her medical expenses given the rising cost of health insurance. Health insurance is complex, often requiring the policyholder to pay various out-of-pocket expenses such as deductibles, co-payments, and co-insurance. A deductible is the amount not covered by insurance before it starts paying; for example, the first $1,000 of medical expenses. A co-payment is a fixed amount for visits, and co-insurance is a percentage of the cost shared between the insurer and the insured. Considering these factors, Laura's choices include:

1. Keeping her health insurance for coverage against unexpected medical expenses.
2. Dropping her insurance and risking high expenses from unforeseen medical issues, banking on her current good health.
3. Reducing her coverage to a lower level which may save money but increase risk.
4. Searching for alternative health insurance plans with lower premiums.

Each option carries different levels of financial risk and potential savings. Hence, Laura should carefully assess her health care needs, financial situation, and risk tolerance before making a decision.