Exam 5: The Economics of Health Care

Under current U.S.tax laws,individuals do not pay taxes on health insurance benefits they receive from their employers.

In the United States,health care spending on people over age 65 is ________ on people aged 18 to 24.

What is the principal-agent problem?

Adverse selection occurs in the market for used cars because used car buyers

Which of the following is an example of adverse selection?

The largest government-run health care system in the world,with 1.4 million employees,is the National Health Service (NHS)in the United Kingdom.The NHS receives its funding primarily from

The overall mortality rate in the United States has declined for the past 35 years.

The health care system in ________ is referred to as a single-payer health care system,and is a system in which the government provides national health insurance to all residents.

Figure 5-4 Figure 5-4 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 5-4.If consumers paid the full price of medical services,the equilibrium quantity would be

Changes in the health of the average person are relatively unimportant as an indicator of changes in the standard of living.

The overall decline in death rates in the United States since 1981 was due to all of the following except

An Organisation for Economic Co-operation and Development (OECD) report states that administration costs for health care in the United States are the highest in the developed world, accounting for over 8 percent of spending in the health care sector, compared to a global average of about 3 percent. According to the report, expensive surgeries, high pharmaceutical costs, and corrupt practices increased global health care costs, and poor coordination between health care providers, duplication of tasks, and excessive time spent on paperwork all contributed to higher administrative costs. The report also noted that administrative costs are generally lower under government-managed health care systems than with private insurance, but governments could still significantly cut spending and improve patients' health. Source: Alanna Petroff, "U.S. health care admin costs are double the average," money.cnn.com, January 11 2017. -Refer to the Article Summary.The article discusses the high administrative costs of health care in the United States.Even if private insurance companies were more efficient and brought administrative costs down,consumers would ________ the full cost of medical treatment.This would result in the market equilibrium price and quantity of medical services being ________ than the efficient equilibrium price and quantity.

On average,people in low-income countries ________ than people in high-income countries.

Which of the following did not contribute to the overall decline in death rates in the United States since 1981?

Those who favor changes in the market for health care that would make it more like the markets for other goods and services favor what are generally known as market-based reforms.

In the United States in 2016,a majority of people received health care through

If a state requires all drivers to buy auto insurance,the problem of adverse selection is eliminated.

________ tended to increase spending on health care in the United States.

In the United States in 2016,the percentage of people who received health insurance through their employer was about

In the United States,total health care spending per person has been ________,and out-of-pocket spending on health care per person has been ________.