Final answer:
Ronald's annual medical costs under the Blue Cross/Blue Shield plan, considering the premium, deductible, and coinsurance, would amount to $1161.84. This is calculated by adding his annual premium of $507.84 to the full cost of his medical expenses, as they do not exceed the $500 annual deductible.
Step-by-step explanation:
To calculate Ronald's annual medical costs under the Blue Cross/Blue Shield plan, we need to take into account the monthly premium, deductible, and coinsurance rate of 20%.
- Calculate the annual premium: $42.32 monthly premium × 12 months = $507.84.
- Calculate the total cost for doctor's visits: 4 visits × $125 per visit = $500.
- Since Ronald's total cost for visits does not exceed the deductible, he will pay the full $500 for the doctor's visits.
- Calculate the total cost for prescriptions: $65 + $89 = $154.
- Ronald pays 20% of the prescription cost after the deductible has been met: $154 × 20% = $30.80.
- However, since the deductible for Ronald's visits has covered the full cost, he needs to first meet the deductible with his prescription expenses. Therefore, Ronald pays the full prescription cost of $154, as it does not exceed the deductible.
- Combine the costs to determine total annual medical expenses.
Annual premium: $507.84
Doctor's visits: $500
Prescriptions: $154
Total annual medical costs = $507.84 + $500 + $154 = $1161.84