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pt2 redo: A health insurance policy pays 85 percent of physical therapy costs af

ID: 2717289 • Letter: P

Question

pt2 redo:

A health insurance policy pays 85 percent of physical therapy costs after a $200 deductible. In contrast, an HMO charges $20 per visit for physical therapy. How much would a person save with the HMO if he or she had 10 physical therapy sessions costing $50 each? Assume the person has no other medical expenses. (Do not round intermediate calculations.)

Amount of savings:

(last WRONG answer: $75)

A health insurance policy pays 85 percent of physical therapy costs after a $200 deductible. In contrast, an HMO charges $20 per visit for physical therapy. How much would a person save with the HMO if he or she had 10 physical therapy sessions costing $50 each? Assume the person has no other medical expenses. (Do not round intermediate calculations.)

Amount of savings:

(last WRONG answer: $75)

Explanation / Answer

Total expense = 10*50 = 500

expenses through HMO = 10*20 = 200

Expenses through insurance policy = 200 + (500-200)*(1-0.85) = 245

Savings = 245 -200 = $45