Question 1

Employer-provided private health insurance began in the United States because

Accepted Answer

A)   the rising threat of socialism prompted U.S. companies to provide insurance to dampen enthusiasm for socialist reform.
B)   during World War II, wage and price controls forced employers to use nonwage forms of compensation to attract workers.
C)   poor health conditions at the beginning of the 20th century prompted the U.S. government to require new companies to offer health insurance to employees.
D)   the American Medical Association successfully lobbied the U.S. government to provide subsidies to companies offering private health insurance to employees.E) All of the above
F) A) and B)

Question 2

(Consider This)  Subsidies to encourage hospitals and physicians to adopt electronic medical records have resulted in which of the following?

Accepted Answer

A)   improved care for a greater number of patients because of the efficiency gains
B)   reduced health care costs because of the efficiency gains in record keeping
C)   more patients seen but at a higher cost because of the high fixed cost of the recording devices
D)   less care at higher costs, as the extensive record-keeping process reduces efficiencyE) A) and D)
F) None of the above

Question 3

Medicare and Medicaid set their payment rates for medical services above marginal cost, but below average total cost. The rationale for doing this includes the following, except

Accepted Answer

A)   saving taxpayers money.
B)   inducing health care providers to serve Medicare and Medicaid patients.
C)   making hospitals and other providers become more profitable.
D)   putting downward pressure on health care costs.E) A) and B)
F) A) and D)

Question 4

Employer-provided private health insurance in the United States has resulted in

Accepted Answer

A)   incentives that encourage the overuse of health care.
B)   incentives that discourage the use of health care, and overall poorer health.
C)   lower costs of health care as providers better achieve economies of scale.
D)   comprehensive coverage of the U.S. population, with few lacking access to adequate health care.E) A) and B)
F) None of the above

Question 5

(Consider This)  Which of the following best explains why hospital charges of $25 per aspirin are not unusual?

Accepted Answer

A)   Government payments for Medicare and Medicaid patients do not cover hospitals' fixed costs, so these costs must be distributed to other patients and their private insurance providers.
B)   Government exercises no cost control for Medicare and Medicaid, so hospitals get away with charging those patients $25 for an aspirin.
C)   Pharmaceutical companies have monopoly power over hospitals, allowing them to charge high prices for medications.
D)   Hospitals distribute a medically advanced form of aspirin that costs more to produce.E) B) and D)
F) C) and D)

Question 6

Health maintenance organizations (HMOs) are like health clubs that operate facilities where people can exercise and get physical training.

Accepted Answer

A) True 
 B)False

Question 7

The health care industry encompasses the following sectors, except

Accepted Answer

A)   medical laboratories.
B)   nursing homes.
C)   nonprescription drugs.
D)   health clubs.E) A) and B)
F) A) and D)

Question 8

The prominence of employer-provided health insurance in the U.S. has had the following major consequences, except

Accepted Answer

A)   overuse of health care services.
B)   rapidly rising prices of health care.
C)   reform efforts have mostly focused on regulation of health insurance.
D)   heightened awareness of employees about the true costs of their health care.E) C) and D)
F) B) and D)

Question 9

Which of the following nations has the highest percentage of its GDP spent on health care?

Accepted Answer

A)   Singapore
B)   Canada
C)   France
D)   United StatesE) C) and D)
F) All of the above

Question 10

The Patient Protection and Affordable Care Act (PPACA)  of 2010 is more commonly known as

Accepted Answer

A)   Dodd Frank.
B)   Obamacare.
C)   stimulus spending.
D)   quantitative easing (Q
E)  .E) A) and D)
F) B) and C)

Question 11

Suppose you go to a doctor, but your health insurance plan reimburses you for only 80 percent of the bill. This is an example of

Accepted Answer

A)   a copayment.
B)   a deductible.
C)   monopsony power.
D)   a deferred benefit plan.E) B) and D)
F) A) and B)

Question 12

Factors that have hampered the increase in the supply of physicians in the U.S. include the following, except

Accepted Answer

A)   actions by doctors' unions, like the AMA.
B)   rising direct expenses for a medical degree.
C)   higher opportunity cost of medical education and training.
D)   rising incomes of physicians.E) A) and B)
F) A) and C)

Question 13

Out-of-pocket costs of health care to consumers are mostly in the form of

Accepted Answer

A)   premiums and copayments.
B)   health taxes and premiums.
C)   premiums and deductibles.
D)   copayments and deductibles.E) A) and B)
F) A) and C)

Question 14

Approximately what portion of health care spending in the U.S. in 2014 was paid by the patients (out-of-pocket) ?

Accepted Answer

A)   21 percent
B)   44 percent
C)   60 percent
D)   75 percentE) All of the above
F) A) and B)

Question 15

(Consider This)  The PPACA created incentives for firms to

Accepted Answer

A)   expand their workforces.
B)   provide on-site medical care for their workers.
C)   reduce workers to part-time status.
D)   fire workers with medical problems.E) All of the above
F) A) and B)

Question 16

Which of the following is a demand-increasing factor in the health care market?

Accepted Answer

A)   rising incomes
B)   the aging of the population
C)   asymmetric information
D)   all of theseE) A) and C)
F) A) and D)

Question 17

The federal government in 2006 enacted limits on "pain and suffering" awards on medical malpractice lawsuits against physicians.

Accepted Answer

A) True 
 B)False

Question 18

Other things equal, and given that the elasticity of demand for health care is 0.2, a 10 percent increase in the price of health care in the United States will reduce the quantity of health care demanded by about

Accepted Answer

A)   1 percent.
B)   2 percent.
C)   5 percent.
D)   20 percent.E) B) and D)
F) B) and C)

Question 19

When the United States is described as having a dual system of health care, this means that

Accepted Answer

A)   government provides basic health insurance for all Americans and private insurance covers services beyond the basic level.
B)   high-quality care is provided in urban areas, but care in rural areas is of poor quality.
C)   those Americans with good insurance or substantial wealth receive world-class health care, while those without insurance receive no or low-quality health care.
D)   the high-risk segment of the population is required to have health insurance, while the low-risk sector is not.E) All of the above
F) B) and C)

Question 20

In recent decades, health care expenditures in the U.S. have been rising in absolute terms, but falling as a percentage of GDP.

Accepted Answer

A) True 
 B)False

Exam 24: Health Care

Employer-provided private health insurance began in the United States because

Correct AnswerverifiedShow Answer

Employer-provided private health insurance in the United States has resulted in

Correct AnswerverifiedShow Answer

(Consider This) Which of the following best explains why hospital charges of $25 per aspirin are not unusual?

Correct AnswerverifiedShow Answer

The federal government in 2006 enacted limits on "pain and suffering" awards on medical malpractice lawsuits against physicians.

Correct AnswerverifiedShow Answer

Which of the following nations has the highest percentage of its GDP spent on health care?

Correct AnswerverifiedShow Answer

The prominence of employer-provided health insurance in the U.S. has had the following major consequences, except

Correct AnswerverifiedShow Answer

When the United States is described as having a dual system of health care, this means that

Correct AnswerverifiedShow Answer

Health maintenance organizations (HMOs) are like health clubs that operate facilities where people can exercise and get physical training.

Correct AnswerverifiedShow Answer

(Consider This) Subsidies to encourage hospitals and physicians to adopt electronic medical records have resulted in which of the following?

Correct AnswerverifiedShow Answer

Other things equal, and given that the elasticity of demand for health care is 0.2, a 10 percent increase in the price of health care in the United States will reduce the quantity of health care demanded by about

Correct AnswerverifiedShow Answer

Out-of-pocket costs of health care to consumers are mostly in the form of

Correct AnswerverifiedShow Answer

(Consider This) The PPACA created incentives for firms to

Correct AnswerverifiedShow Answer

Suppose you go to a doctor, but your health insurance plan reimburses you for only 80 percent of the bill. This is an example of

Correct AnswerverifiedShow Answer

Which of the following is a demand-increasing factor in the health care market?

Correct AnswerverifiedShow Answer

In recent decades, health care expenditures in the U.S. have been rising in absolute terms, but falling as a percentage of GDP.

Correct AnswerverifiedShow Answer

Medicare and Medicaid set their payment rates for medical services above marginal cost, but below average total cost. The rationale for doing this includes the following, except

Correct AnswerverifiedShow Answer

Approximately what portion of health care spending in the U.S. in 2014 was paid by the patients (out-of-pocket) ?

Correct AnswerverifiedShow Answer

The Patient Protection and Affordable Care Act (PPACA) of 2010 is more commonly known as

Correct AnswerverifiedShow Answer

Factors that have hampered the increase in the supply of physicians in the U.S. include the following, except

Correct AnswerverifiedShow Answer

The health care industry encompasses the following sectors, except

Correct AnswerverifiedShow Answer

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