Brad Rowe was a self-employed window washer earning approximately $700 per week. One day, while cleaning windows on the eighth floor of the First National Bank Building, he tripped and fell from the scaffolding to the pavement below. He sustained severe multiple injuries but miraculously survived the accident. He was immediately rushed to the local hospital for surgery. He remained there for 60 days of treatment, after which he was allowed to go home for further recuperation. During his hospital stay, he incurred the following expenses: surgeon, $2,500; physician, $1,000; hospital bill for room and board, $250 per day; nursing services, $1,200; anesthetics, $600; wheelchair rental, $100; ambulance, $150; and drugs, $350. Rick has a major medical policy with LIC Corporation that has a $3,000 deductible clause, an 80% co-insurance clause, internal limits of $180 per day on hospital room and board, and $1,500 as a maximum surgical fee. The policy provides no disability income benefits.
1. Explain the policy provisions as they relate to deductibles, co-insurance, and internal limits.
2. How much should Brad recover from the insurance company? How much must he pay out of his own pocket?
3. Would any other policies have offered Brad additional protection? What about his inability to work while recovering from his injury?
4. Based on the information presented, how would you assess Brad's health care insurance cover-age? Explain.