(This case study can be used for
quantitative reasoning ability for healthcare managers. It is based on price
decision of a health insurance product.)
Background situation
‘Health4all’ a health insurance
company, discovered a town in sub-urban area with a population of 1 lac people. They found that no health
insurance company has so far tapped this area and a significant number of
people are desirous of buying a health insurance product. Buoyed by the
business opportunity, the CEO asked the operations head to start working on selling
your insurance plan here, with a clear stated objective of maximizing profit.
As an operations head you made
all arrangement to launch your flagship health insurance policy in the town,
which gives the customer a cover of 1 lac rupees for a premium of Rs. 1000/-. Customer have to undergo a
health check-up (paid by the company) to determine any pre-existing diseases.
Company doesn’t pay for the treatment of pre-existing diseases found in health
check-up.