Exam 1 Prep: MHA 710 MHA710

Exam 1 Prep: MHA 710 / MHA710

(Latest 2025 / 2026) Healthcare Economics | Questions and Verified Answers | 100% Correct | Grade A - LSU

Question:

Medicare

Answer:

An insurance program for the elderly and disabled, run by the Centers for Medicare & Medicaid Services.

Question:

Medicaid

Answer:

A collection of state-run insurance programs that meet standards set by the Centers for Medicare & Medicaid Services and serve those with incomes low enough to qualify for their state's program. Medicaid enrollment has increased by more than 20 percent as a result of state expansions under the Affordable Care Act.

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Question:

Moral Hazard

Answer:

The incentive to use additional care that having insurance creates.

Question:

Adverse Selection

Answer:

A situation that occurs when buyers have better information than sellers. For example, high-risk consumers are willing to pay more for insurance than low- risk consumers are. (Organizations that have difficulty distinguishing high- risk from low-risk consumers are unlikely to be profitable.)

Question:

Underwriting

Answer:

The process of assessing the risks associated with an insurance policy and setting the premium accordingly.

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Question:

Medicare Part A

Answer:

Coverage for inpatient hospital, skilled nursing, hospice, and home health services.

Question:

Medicare Part B

Answer:

Coverage for outpatient services and medical equipment.

Question:

Fee for Service (FFS)

Answer:

An insurance plan that pays providers on the basis of their charges for services.

Question:

Managed Care

Answer:

A loosely defined term that includes all plans except open-ended fee-for- service. It is sometimes used to describe the techniques insurance companies use. 3 / 4

Question:

PPO (Preferred Provider Organization)

Answer:

Plan that contracts with a network of providers. (Network providers may be chosen for a variety of reasons, but a willingness to discount fees is usually required.)

Question:

HMO (Health Maintenance Organization)

Answer:

Plan that provides comprehensive benefits to enrollees in exchange for a premium. (Originally, HMOs were distinct from other insurance plans because providers were not paid on a fee-for-service basis and because enrollees faced no cost-sharing requirements.)

Question:

Point of Service (POS) Plan

Answer:

Plan that allows members to see any physician but increases cost sharing for physicians outside the plan's network. (This arrangement has become so common that POS plans may not be labeled as such.)

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