9. Health Insurance Market The Affordable Care Act established Health Insurance Marketplaces (HIM) for individual market and small group market. Let us focus on the one specific provision in the individual market. For individuals whose household income is under 250% of Federal Poverty Line (FPL), when they enroll in a silver plan from HIM, they will be automatically enrolled into a same-benefit but lower cost-sharing plan, compared to individuals above 250%. For simplicity, these cost-sharing reductions lower the coinsurance rate for individuals below 250% FPL in a silver plan from 25% to 10%. Suppose that we have two nearly identical individuals Jill and Anne (single, no other household members). Based on their employment contract, Jill's projected household income is 250% FPL, whereas Anne's projected household income is 251% FPL. They both enrolled in the same silver plan via DC Health Link. Now answer the following questions 1-2. A. The graph below contains two ("nominal") demand curves for physician visits (D1 and D2). Please label which is for Jill? Anne? Briefly explain. 100 D₂ 10 Physician Visits (Q) Price (P) 40 20 16 D₂ an

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9. Health Insurance Market
The Affordable Care Act established Health Insurance Marketplaces (HIM) for
individual market and small group market. Let us focus on the one specific provision
in the individual market. For individuals whose household income is under 250% of
Federal Poverty Line (FPL), when they enroll in a silver plan from HIM, they will be
automatically enrolled into a same-benefit but lower cost-sharing plan, compared to
individuals above 250%. For simplicity, these cost-sharing reductions lower the
coinsurance rate for individuals below 250% FPL in a silver plan from 25% to 10%.
Suppose that we have two nearly identical individuals Jill and Anne (single, no other
household members). Based on their employment contract, Jill's projected
household income is 250% FPL, whereas Anne's projected household income is
251% FPL. They both enrolled in the same silver plan via DC Health Link. Now
answer the following questions 1-2.
A. The graph below contains two ("nominal") demand curves for physician visits (D1
and D2). Please label which is for Jill? Anne? Briefly explain.
100
D₂
8
10 Physician
Visits (Q)
Price (P)
40
20
16
D₂
5
10
00
Transcribed Image Text:9. Health Insurance Market The Affordable Care Act established Health Insurance Marketplaces (HIM) for individual market and small group market. Let us focus on the one specific provision in the individual market. For individuals whose household income is under 250% of Federal Poverty Line (FPL), when they enroll in a silver plan from HIM, they will be automatically enrolled into a same-benefit but lower cost-sharing plan, compared to individuals above 250%. For simplicity, these cost-sharing reductions lower the coinsurance rate for individuals below 250% FPL in a silver plan from 25% to 10%. Suppose that we have two nearly identical individuals Jill and Anne (single, no other household members). Based on their employment contract, Jill's projected household income is 250% FPL, whereas Anne's projected household income is 251% FPL. They both enrolled in the same silver plan via DC Health Link. Now answer the following questions 1-2. A. The graph below contains two ("nominal") demand curves for physician visits (D1 and D2). Please label which is for Jill? Anne? Briefly explain. 100 D₂ 8 10 Physician Visits (Q) Price (P) 40 20 16 D₂ 5 10 00
B. If the nominal price per physician visit changes from $40 to $20 per physician
visit, what are the coinsurance for Jill and Anne, at $40 per visit and $20
respectively? And explain.
Transcribed Image Text:B. If the nominal price per physician visit changes from $40 to $20 per physician visit, what are the coinsurance for Jill and Anne, at $40 per visit and $20 respectively? And explain.
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