What is the total out-of-pocket expense for M on a $2,200 claim under the described policy?

What is the total out-of-pocket expense for M on a $2,200 claim under the described policy?

• A. $1,600
• B. $600
• C. $2,200
• D. $200

Answer: (B)

Out-of-pocket costs in this plan come from two parts: the deductible and the coinsurance on the remaining charges after the deductible is met. You first pay the $200 deductible. The remaining covered charges amount to $2,000. With a 20% coinsurance, you owe 20% of $2,000, which is $400. Adding the deductible gives $200 + $400 = $600. So the total out-of-pocket expense is $600. The insurer would cover the rest, typically $1,600, up to any limits that may apply.

Out-of-pocket costs in this plan come from two parts: the deductible and the coinsurance on the remaining charges after the deductible is met. You first pay the $200 deductible. The remaining covered charges amount to $2,000. With a 20% coinsurance, you owe 20% of $2,000, which is $400. Adding the deductible gives $200 + $400 = $600. So the total out-of-pocket expense is $600. The insurer would cover the rest, typically $1,600, up to any limits that may apply.