Correct Response: C. A health insurance plan that requires an annual deductible of $1,200 means that this sum must be paid by the employee before the insurance company begins to make payments. Some preventive care benefits do not require a deductible. When care is not preventive, diagnosis care for example, the patient is responsible for paying for the care until the value of $1,200 has been reached. When the $1,200 deductible is met, the insurance plan will pay the additional medical bills.
The premium, not the deductible, is the amount the employee must pay for insurance (A). The maximum yearly amount that an insurance company will pay for routine health care is called a cap, and is distinct from a deductible (B). Response D is essentially another form of a cap, except it applies to all bills, not just routine bills. This is also distinct from a deductible.
