Bundle: Principles of Economics, Loose-leaf Version, 8th + LMS Integrated MindTap Economics, 2 terms (12 months) Printed Access Card
8th Edition
ISBN: 9781337607735
Author: N. Gregory Mankiw
Publisher: Cengage Learning
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Question
Chapter 7, Problem 11PA
Subpart (a):
To determine
The demand and supply of medical care.
Subpart (b):
To determine
The demand and supply of medical care.
Subpart (c):
To determine
The demand and supply of medical care.
Subpart (d):
To determine
The demand and supply of medical care.
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Students have asked these similar questions
Ralph will consume any health care service just as long as its MB exceeds the money he must pay out of pocket. His insurance policy has a zero deductible and a 10 percent copay, so Ralph only has to pay 10 percent of the price charged for any medical procedure. Which of the following procedures will Ralph choose to consume?
a. An $800 eye exam that has an MB of $100 to Ralph.
b. A $90 hearing test that has an MB of $5 to Ralph.
c. A $35,000 knee surgery that has an MB of $3,000 to Ralph.
d. A $10,000 baldness treatment that has an MB of $16,000 to Ralph.
Page 11 of 11
1707 words
KX Zix Accessibility: Investigate
10. Cost Shifting
The following figure represents a hospital facing both private and Medicare
patients. Please use the graph to answer the following questions.
Hospital
Payment
($)
0
B
Patients
(Hospital Admissions)
A. If Medicare decides to cut the DRG price, what will be the effect on
the number of private and Medicare patients served by the hospital.
Please draw the new demand curves and label the new number of
patients in the graph above and discuss the effect briefly.
B. What is the concept of cost-shifting? What does the above analysis
tell you about cost-shifting?
Display Settings Focus
+ 1009
Below is an example of supply and demand for healthcare services in the U.S.
(Third-Party Payer Market)
1) In the U.S. patients pay an average of 20% of total healthcare expenditures.
Using the table below, if patient's pay an average copay is $647 per visit, what
would be the average total cost per visit? At that price, what quantity will be
exchanged in this market? What is the total amount spent on Healthcare?
(Remember, this is a Third-Party Payer Market)
2) Healthcare costs continue to rise faster than GDP, taking up an increasing
share of total U.S. expenditures. What is one way that we might reduce total
healthcare expenditures? Use the values on the table (estimates are totally fine)
to illustrate how your proposal would reduce the total cost of healthcare. Feel
free to attach an image of a graph to help explain your point.
Average Total cost per
visit (Insurance Cost plus
Co-Pay)
Demand for office visits Supply of office visits
(Millions/yr)
(Millions/yr)
Chapter 7 Solutions
Bundle: Principles of Economics, Loose-leaf Version, 8th + LMS Integrated MindTap Economics, 2 terms (12 months) Printed Access Card
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