EBK HEALTH ECONOMICS
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ISBN: 9781137029973
Author: TU
Publisher: YUZU
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Chapter 5, Problem 5E
To determine
Medical institutions and the practice of medicine.
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The fact that most medical care purchases are financed through insurance:
a. has no effect on health care consumption because aggregate costs are the same regardless of payment method.
b. reduces the amount of health care consumed by raising the price of additional units of care.
c.has decreased health care costs and therefore reduced aggregate health care expenditures.
d. increases the amount of health care consumed by reducing the price of additional units of care.
During the course of a pandemic, does a company that is considering outsourcing face any unique risks with regard to the industry or its service providers?
How can the New York sick leave law impact the use of emergency rooms? Reference the Grossman model for guidance.
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- Government Intervention in Medical Markets Include which of the following? Price controls, Entry Restrictions or Tax Policy?arrow_forwardWill insurance prices in 2024 erase the momentum of lower health costs despite the IRA prescription drug efforts?arrow_forwardWhich of the following is NOT true? Group of answer choices On average, most costs of medical school are covered by student tuition Most who get accepted into a medical school attend one. Most who attend medical school graduate Most who graduate medical school go into a residency programarrow_forward
- How do fee-for-service and capitation payment systems affect the amount of medical care the patient receives relative to the optimum amount that would be provided by the “perfect” agent? Under which system we expect to see more supplier-induced demand?arrow_forwardBuild and secure a market based economic intervention to address the social determinants of health.arrow_forwardSuppose an insurance company wants to charge a very healthy individual a premium of $1,200 a year for health coverage. It also wants to charge a less healthy individual a premium of $3,600 a year for health coverage. It is seeking to ascertain from any given customer information regarding his/her health by asking for several pieces of health-related information, such as doctor assessments of the person’s health, history of health-related problems, etc. The opportunity cost of a very healthy person securing a health report is $250 and the opportunity cost of a less healthy person securing a health report is $650. Of the choices below, how many reports should the company request to best ensure its paying the right premium to the right person? Reconsider the previous health insurance question. Of the choices below, which one is closest to the spread between the minimum possible number of reports and the maximum possible reports to achieve the company’s desired outcome? Reconsider again…arrow_forward
- Inability of one to determine marginal value of health care implies that the traditional approach to demand theory does not work very well for health-care services. True or false?arrow_forwardHospital has the following treatment options to reduce the incidence of Ventilator-Associated Pneumonia: For Treatment X (status quo), it would cost 50,000 with 40 percent effectiveness, For Treatment Y, it would cost 100,000 with 85 percent effectiveness, For Treatment Z, it would cost 75,000 with 65 percent effectiveness, and For Treatment V, it would cost 80,000 with 68 percent effectiveness. Is there any treatment option that is not economically rational? Explain. If the hospital’swilling to pay is $1000, which treatment optionwould it choose? Explain With technical innovation, suppose Treatment V increased its effectiveness to 75 percent, would your answer to question (a) above change?arrow_forwardMedical bills may be paid by any of the following methods except shifting consumption from one period to another. reducing your welfare loss. charity. family or friends. third party insurance companies.arrow_forward
- People make decisions by comparing marginal benefits with marginal costs. An optimaldecision requires that marginal benefits are above below or equal to marginal costs?arrow_forwardExplain what is meant by the following sentence: “All Whole Life policies involve prefunding of future mortality costs.”arrow_forward
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