Exam 7: The Economics of Health Care

The difference between adverse selection and moral hazard is that

Which of the following Nobel laureates became known for the study of asymmetric information?

Because consumers who have insurance provided by their employers usually only pay a deductible for a visit to the doctor's office

Of the following,which has most likely contributed the most to the rapid rise in health care costs in the United States?

A typical consumer of health care in the United States

In the United States,consumers usually pay less than the true cost of medical treatment because of

The largest government-run health care system in the world,with 1.7 million employees,is in

In the market for insurance

Figure 7-2 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 7-2.At the efficient equilibrium

In 2015,infant mortality in the United States was ________ per 1,000 live births.

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

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.At the market equilibrium,the deadweight loss is equal to

The Patient Protection and Affordable Care Act (ACA)is scheduled ________,at which point more than 30 million additional individuals are expected to have health care coverage.

Because consumers who have insurance provided by their employers usually only pay a deductible for a visit to the doctor's office

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.

On average,people in the United States spend a smaller percentage of their income on health care than do people in most other countries.

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 still pay less than the full cost of medical treatment.This would result in the market equilibrium price of medical services being ________ than the efficient equilibrium price,and the market equilibrium quantity of medical services being ________ than the efficient equilibrium quantity.

What is adverse selection?

Figure 7-2 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 7-2.At the market equilibrium

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