Dan has a major medical expense policy with a $200 deductible and an 80/20 coinsurance provision. If he incurs covered medical expenses of $100 in November and $400 in January, how much will the insurer pay?

To understand how much the insurer will pay in this scenario, we need to calculate the covered medical expenses for both months, considering the deductible and the coinsurance arrangement.

In November, Dan's covered medical expenses amount to $100. However, since he has a $200 deductible, he must first cover that amount out of pocket before his insurance begins providing any reimbursement. Because the total expenses in November do not exceed the deductible of $200, the insurer will not make any payments for the November expenses.

In January, Dan incurs $400 in covered medical expenses. At this point, he has already paid his deductible from November, so the insurer will begin to share the costs based on the 80/20 coinsurance provision. First, we need to apply the deductible to the January expenses. The deductible applies once per policy period, so Dan does not have to pay another deductible amount this time.

Since there is no deductible left to pay for January, the insurer will cover 80% of the January expenses. The calculation goes as follows:

• Dan’s total expenses in January: $400
• Insurer’s share: 80% of $400 = $320

Thus, the insurer will pay $320 for the expenses incurred in January.