Exam 7: The Economics of Health Care

All of the following are part of the "individual mandate" provision of the Patient Protection and Affordable Care Act (ACA) except

Figure 7-4 Figure 7-4 represents the market for medical services with and without insurance, and the effect of a third-party payer system on the demand for medical services. -Refer to Figure 7-4. If consumers paid the full price of medical services, the price they would pay is

In the United States, private health insurance companies

Suppose that in a market for used cars, there are good used cars and bad used cars (lemons). Consumers are willing to pay as much as $9,000 for a good used car but only $3,000 for a lemon. Sellers of good used cars value their cars at $7,500 each and sellers of lemons value their cars at $1,500 each. Buyers cannot tell if a used car is reliable or is a lemon. Based on this information, what is the likely outcome in the market for used cars?

The health care system in Japan is referred to as ________, under which every resident of Japan is required to enroll in either a private, or the government-provided, health insurance program.

A goal of ________ is to give patients an incentive to pay more attention to the prices of medical services. This would tend to increase economic efficiency by decreasing the costs of medical services

Of the following high-income countries, which has the highest female life expectancy at age 65?

Health insurance companies impose deductibles on policies and co-payments on claims

Due to adverse selection, very few lemons will be sold in the market for used cars.

The provision of the Patient Protection and Affordable Care Act (ACA) which states that insurance companies are required to participate in a high-risk pool that will insure individuals with pre-existing medical conditions who have been unable to buy health insurance for at least six months is the ________ provision.

When consumers pay only a fraction of the true cost of medical services, their demand increases. The marginal cost of producing these extra services

Typically, the lower the level of income per person in a country, the lower the level of spending per person on health care. This relationship between income and spending indicates that health care is a

Under the Patient Protection and Affordable Care Act (ACA), insurance companies are required to participate in a high-risk pool that will cover individuals with pre-existing medical conditions.

College education tends to result in a negative externality because the recipient does not receive the full benefit of the education.

What are two reasons why employees would prefer for their employer to pay for their health insurance rather than receiving increased wages and paying for their own health insurance?

Of the following high-income countries, which has the lowest life expectancy at birth?

What is an externality? Explain how someone receiving a meningitis vaccination is an example of an externality in the market for health care.

Which of the following reforms could potentially reduce spending on health care without reducing the effectiveness of health care received?

Suppose consumers pay less than the true cost of medical services because a third party, such as an insurance company, pays most of the bill. Draw a graph showing the supply and demand for medical services with and without a third-party payer. Identify the market equilibrium without insurance, the market equilibrium with insurance, and the area representing the deadweight loss. Be sure to label the efficient and the market prices and quantities.

As a percentage of all spending on health care, out-of-pocket spending has ________ in the United States.