Christi L. Baker
March 5, 2012
Castor Collins Health Plans, a regional health maintenance organization (HMO), in the state of Pantome provides HMO health insurance and health care services to enrollees through its statewide network of physicians and hospitals. E-Editors, a company with 1600 employees has asked Castor Collins to find an employee health insurance plan that accepts preexisting conditions at a maximum premium of $4,500 per person. Caster has two plans, which may fit the client’s demands. This paper converses the selection method including risk factors as compared to premiums that the company is willing to pay. In addition, the paper also considers the selection method of Cigna as a comparison to data available for Castor Collins.
Economic Issues Simulation Paper
Castor Collins Health Plans is a regional HMO founded in 1999 in the state of Pantome (University of Phoenix, 2011). Using a capitation model to pay its network of health providers, the HMO provides health insurance and health care services to enrollees statewide (University of Phoenix, 2011). Caster Collins currently has 100,000 enrollees throughout Pantome and is actively pursuing to increase this number. On January 2006, E-Editors, which comprises 1,600 people, approached Castor Collins with a need for employee health insurance plan. Currently E-Editors does not have health insurance, which means that the individuals will pay for their own insurance (University of Phoenix, 2011). The people at E-Editors are willing to pay a maximum annual premium of $4,500 per person (University of Phoenix, 2011). Caster Enhanced Minor covers preexisting conditions, but risks under this plan are lower than under Caster Enhanced, because this plan covers fewer services (University of Phoenix, 2011). For E-Editors, the premium charged for this plan is $4,491, and earnings are $7.19 million. Because a good decision made by excluding...