Exam 7: The Economics of Health Care

Which of the following is not an advantage to an insurance company of insuring a large group of people for health insurance?

For many small firms,providing health insurance for their workers

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

One reason why adverse selection problems arise in health insurance markets is that

Figure 7-5 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 7-5.The efficient price of medical services is

Substantial co-payments are typically not required as a part of the health care system in

Figure 7-6 represents the supply and demand for medical services with and without a third-party payer. -Refer to Figure 7-6.Answer the following questions: 1.What would be the equilibrium price and quantity if consumers had to pay the full price of medical services? 2.With insurance acting as a third-party payer,what price will consumers pay for medical service? 3.With insurance acting as a third-party payer,what price will doctors receive for medical service? 4.With insurance acting as a third-party payer,what will be the equilibrium quantity of medical services? 5.With insurance acting as a third-party payer,what will be the value of the deadweight loss?

The largest government-run health care system in the world,with 1.7 million employees,is the National Health Service (NHS)in the United Kingdom.The NHS receives its funding primarily from

Figure 7-1 represents the market for vaccinations.Vaccinations are considered a benefit to society,and the figure shows both the marginal private benefit and the marginal social benefit from vaccinations. -Refer to Figure 7-1.The efficient equilibrium price is

In a market with positive externalities,the market equilibrium quantity will be less than the efficient equilibrium quantity.

Figure 7-5 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 7-5.With insurance and a third-party payer system,what price do consumers pay for medical services?

Which of the following is not part of the "state health insurance marketplaces" provision of the Patient Protection and Affordable Care Act (ACA)?

Which of the following is not an advantage of risk pooling?

One effect of adverse selection in a market is that the equilibrium quantity of the product may be smaller than it would have been if there were no asymmetric information problems.

Basic supply and demand analysis indicates that having firms rather than the government provide health insurance to workers

Article Summary The Center for Medicare and Medicaid Services (CMS)projects that between 2014 and 2022,over $2.7 trillion will be spent for private insurance overhead and administering government health programs,including more than $270 billion in new administrative costs for the Affordable Care Act,which averages to $1,375 per newly insured person every year,or almost one-quarter of the total federal government expenditures for the program.Government programs account for over $100 billion of the increase in overhead,and most of that will go to private Medicaid HMOs,which will account for 59 percent of total Medicaid administrative costs in 2022. -Refer to the Article Summary.The article discusses the rising administrative costs of health care.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.

In the United States,private health insurance companies

In a market with positive externalities,the market equilibrium price will be greater than the efficient equilibrium price.

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.

Figure 7-1 represents the market for vaccinations.Vaccinations are considered a benefit to society,and the figure shows both the marginal private benefit and the marginal social benefit from vaccinations. -Refer to Figure 7-1.The market equilibrium price is