Indicate whether each statement is true or false, and justify your answer.Price controls decrease the innovation rate for drugs but make existing drugs more affordable.
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Indicate whether each statement is true or false, and justify your answer.
Price controls decrease the innovation rate for drugs but make existing drugs more affordable.
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- Based on the data presented in the table below estimate elasticity of demand for two price changes: a) price increase from $3 to $9 per hour; and b) price decrease from $9 to $3 per hour. Make sure to use the midpoint formula. Price Per Hour of Therapy Demand for Therapy 0 16 1 15 2 14 3 13 4 12 5 11 6 10 7 9 8 8 9 7 10 6 11 5 12 4 13 3 14 2 15 1 16 0Private plans were able to reduce overall drug expenditures to an extent due to: the ability of private plans to drive the use of less expensive therapeutic substitutes a decrease in prices by pharmaceutical companies an increase in prices by pharmaceutical companies the ability of Medicare Part D plans to drive the use of drugs toward less expensive therapeutic substitutesThe Tucker family has health insurance coverage that pays 80 percent of out-of-hospital expenses after a deductible of $1,000 per person. If one family member has doctor and prescription medication expenses of $2,200, what amount would the insurance company pay?
- Identify the initial equilibrium price and quantity of the drug per day. Suppose the government imposes a price control at $1.50 a dose. How many doses are purchased after the price control is imposed?Assume throughout that an individual's demand curve for doctors visits is represented by Q = 50 – P. - The market price of a doctor's visit is $30 per visit. Assume the individual has an insurance plan with a deductible of $3,000 and a coinsurance rate of 20%. How many doctor's visits would the individual need have to reach the deductible limit?Indicate whether the statement is true or false, and justify your answer.Disproportionate spending on end-of-life care is never clinically justifiable.
- Indicate whether the statement is true or false, and justify your answer.People who drop out of high school are able to produce more health than college graduates because they have more free time to invest in health production.Indicate whether the statement is true or false, and justify your answer.An hour spent exercising always pays for itself by decreasing the time spent sick by more than an hour.Suppose that there are two countries, Beta and Gamma. Suppose further that everyone in country Beta is on Insurance B and everyone in country Gamma is on Insurance G. Suppose further that both governments use government-set price controls. In 2005, country Beta decided to change the reimbursement rate for pharmaceuticals, but country Gamma did not make this change. You, a researcher, want to study the effect of offering coverage for this drug had an impact on health expenditures. You have average health expenditures for State Beta and Gamma prior to 2005 and post-2005. Using your finding from the question above, you can infer that country Beta likely _____ reimbursement rates for pharmaceutical drugs. State Time Periods Pre-2005 Post-2005 State Beta $1000 $1400 State Gamma $1500 $1700 a. lower b. did not change c. raised
- Demand studies in health care have provided estimates of both income and price elasticity. Estimates of income elasticity are usually above +1.0 and estimates of price elasticity typically range between −0.1 and −0.75 (with hospital services at the lower end and elective services at the upper end). What is the significance of these estimates to policy makers?Indicate whether each statement is true or false, and justify your answer.Both ICERs and ACERs compare two drugs on the basis of both cost and medical efficacy.Indicate whether the statement is true or false, and justify your answer.Compared with doctors who are paid on a fee-for-service basis by health insurers, doctors who are paid on a capitated (per-patient) basis have incentives to provide too much care.
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