A 25-year-old client with no medical problems is seeking new insurance coverage. They make minimum wage and don't want to spend too much money on coverage. Which type of health insurance is the client looking for?

• A. PPO
• B. HMO
• C. Medicare
• D. Medicaid

Answer: (B)

When cost is the main concern and you’re generally healthy, a managed care plan that emphasizes lower costs and predictable out-of-pocket spending is usually the best fit. An HMO typically offers the lowest premiums and copays because it relies on a network of in-network providers and focuses on preventive care. You select a primary care physician who coordinates your care, and you’ll need referrals to see specialists, which helps keep overall spending down and avoids unnecessary services. For someone who doesn’t anticipate frequent medical needs, this organized, budget-friendly structure makes HMOs a practical choice.

PPOs, while offering more flexibility and the option to see out-of-network providers, generally come with higher premiums and out-of-pocket costs. Medicare isn’t designed for a healthy 25-year-old unless there are specific qualifying disabilities, so it’s not applicable here. Medicaid is a government program for low-income individuals, and eligibility depends on income and other factors; while it can be very low-cost or free, qualification isn’t guaranteed and isn’t a guaranteed option for every minimum-wage earner.