Economic Issues Simulation
November 14, 2011
University of Phoenix
Richard Harley Smith
Economic Issues Simulation
I am Mary Mulanax I am the Vice President, Strategy and Financial Planning at Castor Collins. My duties include pricing plans and setting insurance premiums for our potential clients. Castor Collins was approached by two companies looking for employer insurance and both companies have a set rate their employees are able to pay for premiums since both groups will have to pay for his or her own insurance (Axia College, 2006). The first company is Constructit that consist of 1,000 people and E-Editors that consist of 1,600 people. It is up to my team ...view middle of the document...
The majority of the workforce misses work due to injuries, respiratory system diseases, digestive disorders, migraine, and allergic conditions (Axia College, 2006).
In our investigation of the health demographics in Constructit we discovered the following health concerns. Almost half of the employees are obese, 198 men and 192 women which adds up to 39% of the workforce which in itself is a major concern. Obesity can cause High Cholesterol the second highest medical condition within this group meaning 19%, 101 men and 95 women. As well as high blood pressure is another cause of health concern with 88 men and 105 women, 19% of the workforce (Axia College, 2006).
We also discovered many suffer from an allergy which affects 92 men and 85 women 17% overall. Many of the employees suffer from migraines 16%, 75 men and 93 women. Although only 13% of the employees 78 men and 57 women Respiratory Diseases is still a cause of concern. The Last medical condition we discover was digestive disorders at 8% 52 men and 32 women. Now our task was to develop a plan and stay within our $4000 premium limit (Axia College, 2006).
Here at Castor Collins we have two plans that could possibly fit the needs of Constructit. One is Castor Standard which does not cover preexisting medical conditions and the other is Castor Enhanced which does cover preexisting medical conditions. Helen one of my team members suggests we offer Constructit Castor Enhanced and eliminates a few services that have high utilization. Adam says or we could choose not to insure either group if our risk outweighs the profits. In our evaluation the risk, anticipated cost, and cost-effectiveness are different for both plans. We did not choose Castor Standard because for one it did not cover preexisting condition. The premium is within payment range enrollees can pay and our profits would be higher.
The cost associated with Castor Collins providing services to Constructit does not include any copayment the enrollee has to pay. For example for inpatient hospital services for Standard the enrollee pays $114 where in Enhance they pay $144. For emergency physician or hospital care Standard is $310 where Enhances is $388. For outpatient services like physician visits the in Standard the enrollee would pay $56 and in the Enhanced he or she would pay $70. If the enrollee was to need outpatient surgery for standard he or she would pay $305 where with enhanced the cost is $381.
Here is the expected utilization of services when Castor...