11.1: Health Insurance Premiums - HITCHENS
[Pages:3]11.1: Health Insurance Premiums
Objective: SWBAT compute health insurance premiums.
An accident or illness could cut off your income, wipe out your savings, and leave you in debt. Just as important as vehicle insurance is health insurance. It protects you against overwhelming medical expenses.
Many types of health care coverage plans exist. Let's focus on just three group health insurance plans--a traditional plan, a preferred provider organization (PPO), and a health maintenance organization (HMO). Under a traditional plan, the health care provider receives a specific dollar amount for the service given. When on a traditional plan, you may use any health care provider. A PPO is a group of selected health care providers who offer comprehensive services at preset reimbursement levels. You are required to use these "network" providers (that is, a selected group of doctors) unless you are willing to pay additional costs to nonnetwork providers. An HMO is a prepaid health plan in which the care providers either contract with or are employees of the HMO to provide you with services (ex. A nurse at PRMC). You may select a "primary care" physician and agree to receive all non-emergency services from the physician. This physician may refer you to a specialist (such as an allergist, a psychiatrist, a cardiologist, and so on.)
Often times the selected employer's health insurance group pays for 75 to 80 percent of the costs and you, the policyholder, pay for the remaining 20 or 25 percent. Given this, how do you budget for health insurance? That is what we are going to be looking into today.
Important Questions To Ask yourself How do I calculate the percent that you'll be paying? How do you calculate how much you'll contribute each paycheck to health insurance?
What Formula do I use? Employee's Percent = 100% - Employer's Percent Employee's Contribution = Total Premium X Employee's Percent
Warm Up:
When you move out of your parent's home, you will need health insurance. Anything can happen that could result in racking up extreme bills that would take years to pay for. When you get health insurance, you have to pay a premium. What is the purpose in paying the premium for health insurance? Why do you have to pay this?
Adapted for Education purposes from Glencoe Mathematics with Business Applications. 2015
Example 1: The Steins have a family membership under the Salisbury University group medical insurance program. The annual premium is $6,180. Salisbury University pays 80 percent of the total cost. Their contribution is deducted monthly from Mr. Stein's paycheck. What is his annual contribution? What is his monthly contribution?
Step 1: Find the employee's percent. 100% - 80% = 20% Employee's Percent
Step 2: Find the employee's annual contribution.
Total Premium X Employee's Percent
$6,180.00 X
20%
= $1,236.00 Employee's annual contribution
Step 3: Find the employee's monthly deduction.
Employee's Contribution / 12
$1,236.00
/ 12 = $103.00 Employee's monthly deduction
Example 2: Linda Wilson works at Bayhealth Medical Center and pays into an HMO. The total cost is $12,234.00 and the employer pays 90% of the total cost. She also pays 40% of the optional annual dental premium of $893 and 50% of the optional annual vision premium of $382. How much is deducted each week from her paycheck?
Step 1: Find the weekly deduction for total cost. 100% - 90% = 10% Employee's Percent
$12,234.00 X 10% = $1,234.00 Employee's annual contribution
$1,234.00 / 52 = $102.83 Weekly Deduction for total cost
Step 2: Find the weekly deduction for dental premium. $893 X 40% = $357.20 Employee's Premium
$357.20 / 52 = $6.87 Weekly Deduction for dental premium
Step 3: Find the weekly deduction for vision premium. $382 X 50% = $191.00 Employee's Premium
1. $1,513.75 2. $126.15 3. $3,097.71 4. $258.14
$191.00 / 52 = $3.67 Weekly Deduction for vision premium Step 4: Find the total weekly deduction.
$102.83 + 6.87 + 3.67 = $113.37 Total Weekly Deduction Self Check Answers:
1. $1,513.75 2. $126.15 3. $3,097.71 4. $258.14
................
................
In order to avoid copyright disputes, this page is only a partial summary.
To fulfill the demand for quickly locating and searching documents.
It is intelligent file search solution for home and business.
Related download
- section 11 2 section 11 3 section 11 4
- mathematics of personal finance apex learning virtual school
- scott foresman addison wesley mathematics pearson education
- lesson plan health insurance missouri
- 11 2 health insurance benefits hitchens
- lesson plan auto insurance missouri
- consumers math chapter 11 1st notes lesson 11 1 11 ms sommerman s
- how health insurance works rutgers university
- different types of insurance quia
- lesson 1 health care systems and health insurance minnesota dept of
Related searches
- term life insurance premiums by age
- fha mortgage insurance premiums 2019
- 11 1 biology study guide answers
- 11 1 wh to mah
- vmware tools 11 1 1
- fha mortgage insurance premiums 2020
- 11 1 distance and displacement answers
- 11 1 the work of gregor mendel answers
- health insurance innovation health coverage
- adobe acrobat 11 1 free download
- 11 1 gregor mendel answer key
- 11 1 gregor mendel worksheet answers