Exam 7: The Economics of Health Care

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.If consumers paid the full price of medical services,the equilibrium quantity would be

If a hospital knows that an insurance company will pay for most of a patient's bill,the hospital has more of an incentive to require additional medical procedures and tests,even if the patient may not require them.This is an example of

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

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

In the United States,the bulk of health care spending is paid by health insurance companies.Such a system is also called a ________ where consumers of health care pay a nominal fee and the rest is paid by the health insurance provider.

Consider a used car market in which half the cars are good and half are bad (lemons).A rational buyer in this market should

Figure 7-3 shows the effect of a positive externality on the market for vaccinations. -Refer to Figure 7-3.On the above graph,identify the market equilibrium price and quantity,the efficient equilibrium price and quantity,and the value of the deadweight loss resulting from too few people receiving vaccinations.

In 2014,employees covered by company-provided health insurance paid ________ percent of the cost of their own health insurance.

In the United States,out-of-pocket spending on health care per person

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.

Some economists have argued that certain characteristics of the delivery of health care justify government intervention.One of these characteristics is

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.With insurance and a third-party payer system,what price do doctors receive for medical services?

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

Most doctors are employed by the government and most hospitals are owned by the government in

Consumers usually pay less than the total cost of medical treatment because

A decrease in the availability of lower-cost drugs will tend to shift the ________ curve for medical services to the ________.

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

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

The health care system in the United Kingdom is referred to as ________,under which the government owns most of the hospitals and employs most of the doctors.

Because of the ________ of vaccinations,economic efficiency would be improved if more people were vaccinated.