Question
Suppose you have a health insurance policy with an annual premium of \( \$ 4800 \), an annual deductible of \( \$ 1000 \), and copayments of \( \$ 25 \) for visits to the doctor's offices. Suppose you go through the year with no medical bills at all. What is your total cost for the year? Your total cost for the year is
Ask by Huff Graham. in the United States
Feb 26,2025
Upstudy AI Solution
Tutor-Verified Answer
Answer
Your total cost for the year is \$4800.
Solution
The premium is the fixed cost you pay for having the health insurance policy, regardless of whether you use any medical services. Since you didn’t incur any medical bills, you didn’t have to pay any deductible or copayments during the year. Therefore, your only cost is the annual premium of $4800.
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If you go through the year with no medical bills at all, your only expense would be the annual premium. In this case, you would pay \( \$ 4800 \) for the premium, and since you have no medical services, you won't hit the deductible or incur any copayments. Therefore, your total cost for the year is simply \( \$ 4800 \).
