1. What does Medicare Part C do?

Chapter 1

• What does Medicare Part C do?

• Provides the aged with home health care
• Provides the aged with prescription drugs
• Enables low-income aged to participate in Medicaid

*d. Provides a voluntary managed care option for the aged

• How is Medicaid administered?

*a. By each state

• By the federal government
• Jointly by each state and the federal government
• By insurers under contract with the federal government

• How is Medicaid financed?

• It is financed entirely by t he federal government.
• It is financed entirely by the state.
• States receive the same percentage of federal support.

*d. States with lower per capita incomes receive a greater percentage of federal support.

• The Affordable Care Act

• did not make any changes to the Medicaid program.

*b. increased Medicaid eligibility.

• reduced funding for Medicaid.
• required adult Medicaid recipients to buy their insurance on

health insurance exchanges.

• Which of the following statements describe s how the financing of US

healthcare has changed over time?

• The federal government now finances 76 percent of total

healthcare expenditures.*b. Out-of-pocket payments represent less than 15 percent of total healthcare expenditures.

• Expenditures for prescription and over-the-counter drugs are

as great as hospital expenditures.

• None of the above

• In the past ten years, medical expenditures have risen more slowly

primarily because of

• the introduction of the Affordable Care Act.
• stringent Medicare price controls on hospitals and physicians.
• state regulation of health insurance premiums.

(Health Policy Issues An Economic Perspective, 7e Paul Feldstein) (Official Complete Test Bank) 1 / 4

*d. a severe recession, greater number of uninsured people, and fewer employees with employer -paid health insurance.

• In coming years, medi cal expenditures are expected to rise at a

faster rate because of

• the growing economy.
• increased demand as a result of the Affordable Care Act.
• the development of new technology and expensive specialty

drugs.*d. All of the above

• The growth in private health insurance was stimulated by

• federal and state subsidies.

*b. higher per capita income and tax -exempt employer-paid health insurance.

• the growth of private managed care organizations.
• federal and state regulatory policie s.

• An effect of government regulating physician -fee increases to reduce

rising Medicare physician expenditures was that

• physician participation rates in Medicare declined.
• physician participation rates in Medicare increased.
• access to care for Medicare patients declined.

*d. A and C

• Managed care relies on which of the following to reduce enrollees’

premiums?

• Dramatically increasing enrollees’ out -of-pocket expenses

*b. Having providers compete to join limited provider networ ks

• Increasing specialists’ fees to provide them with an incentive

to become more productive

• B and C
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Chapter 2

• Why is there a concern that this country is spending too much on

medical care?

• Insurers’ administrative costs are too high.
• Hospitals and physician prices are much higher than in other

countries.*c. The country is not receiving suf ficient value for what it spends on healthcare.

• The healthcare system is too regulated.

• Consumer sovereignty is based on the concept that

*a. consumers know best what they want.

• consumer out-of-pocket payments should be higher so that

consumers become more price sensitive.

• consumers should have greater representation on hospital and

insurer boards of directors.

• consumers should have more comprehensive insurance so that

they have more control over their choice of provider.

• The relationship between the benefits of an additional visit and the

number of visits is

• constant.
• increasing.

*c. decreasing.

• A and B

• What is the “right” or “optimal” amount of spending for a person?

• When the additional medical benefit provided to the patient is

worthwhile, as determined by a health professional *b. When the benefit of the last visit to the physician is equal to the cost to the consumer for that visit

• When the additional medical benefit of that visit is

worthwhile, as determined by the patient

• When the benefit of the last visit to the physician is

considered appropriate according to clinical guidelines

• Economic waste occurs when

*a. the expected benefits of an intervention are less than the expected costs.

• the expected benefits of an intervention have very little

perceived value to the health professional.

• the expected benefits of an intervention have very little

perceived value to the patient. 3 / 4

• the expected benefits of an intervention do not m eet

established clinical guidelines.

• Competitive markets in healthcare assume that

• government determines the appropriate training and number of

competitors.

• purchasers have information on the benefits of a treatment,

provider quality, and th e costs of care.

• purchasers have a price incentive when making their choices.

*d. B and C

• If a healthcare system is “free” to everyone, and the government

provides all the care demanded, then

• everyone receives the “appropriate” amount of ca re.

*b. the benefits of an additional visit are very low.

• the benefits of an additional visit are very high.
• the benefits of an additional visit in relation to the cost of

production are unknown.

• If a healthcare system is “free” to everyone, and the government

limits the amount of care provided, then

• those who can afford it go elsewhere —to another country—for

their care.

• a shortage occurs.
• “too few” visits result.

*d. All of the above

• State and federal governments typicall y try to limit medical

expenditure increases by

• encouraging insurers to use limited provider networks.
• incentivizing Medicare beneficiaries to enroll in managed care

plans.*c. instituting provider price controls.

• promoting high-deductible health plans.

• The government’s concern over rising healthcare costs is to ensure

that

• universal coverage occurs.

*b. the government doesn’t have to increase taxes or reduce politically popular programs.

• the voting public receives value for i ts money.
• appropriate new technologies are not overused.
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