Question

Malinda is a participant in her employer's group comprehensive major medical insurance plan. The plan has a $500 deductible, a $2,500 out-of-pocket maximum, and has 80% coinsurance. If Malinda is injured in an accident, resulting in $2,000 in medical costs, how much will Malinda need to pay for the medical bills?

Answer 1

Malinda will need to pay a deductible of $500 and an additional amount for coinsurance of $300, resulting in a total of $800 for her medical bills.

Step-by-step explanation:

Malinda will need to pay the deductible of $500, which is the amount that she must pay out-of-pocket before her insurance coverage starts paying. After she meets the deductible, her coinsurance will apply. The coinsurance rate is 80%, which means that Malinda will be responsible for paying 20% of the remaining costs.

In this case, Malinda's total medical costs are $2,000. After paying the deductible of $500, she will have $1,500 left. Malinda will need to pay 20% of this amount, which is $300. Therefore, Malinda will need to pay a total of $500 (deductible) + $300 (coinsurance) = $800 for her medical bills.