Question 1

Of the 1,750 students expected to graduate with an M.D. from U.S. medical schools this year, the average debt per student will exceed $100,000.

Accepted Answer

17,500 students are expected to graduate this year with an average debt of $110,000.

Question 2

The federal government, through its control over the American Medical Association, held the physician supply constant for most of the 20^th century.

Accepted Answer

Flexner Report spurred state level requirements on medical schools and physicians. This resulted in a decline in the physician supply from 1.73 to 1.33 MDs per 1,000 population from 1910- 1930. From 1930 -1965, the supply held constant at that level, and kept rising steadily afterwards. The rate of physicians per 1,000 population was about 3.12 in 2010.

Question 3

The level of international medical school graduates entering the U.S. for residency training programs has been trending upward for the past 20 years.

Accepted Answer

The number has been growing in the 1960s through 1990s, but has remained steady since 1995 at about 6,000 per year.

Question 4

Economies of scale mean that a group physician practice is likely to return more income to physicians than an individual practice.

Accepted Answer

Economies of scale allow a group physician practice to spread out costs, negotiate better rates, and leverage shared resources, often resulting in higher income per physician compared to an individual practice.

Question 5

Strict rules about the conduct of physicians are rooted in the agency relationship between doctor and patient.

Accepted Answer

The agency relationship between doctor and patient establishes a fiduciary duty, where the physician acts on behalf of the patient's best interests, necessitating strict rules about conduct to ensure trust and ethical treatment.

Question 6

If the amount billed to a patient increases because the surgeon encountered difficulties during surgery which required additional medical interventions, this is an example of price discrimination.

Accepted Answer

Price discrimination involves charging different prices to different consumers for the same product or service, based on their willingness to pay, not on the cost of providing the service. The scenario described involves additional charges due to unforeseen medical complications, which is related to the cost of providing additional services, not price discrimination.

Question 7

For physicians in an individual practice, foregoing average higher earnings of physicians in group practice represents a rational economic decision.

Accepted Answer

Economists assume that individuals make rational choices.

Question 8

A local dentist provides a deep discount for dental care to his elderly patients; a 10% discount to the uninsured patients; but is able to charge substantially more than "usual, customary and reasonable charges" to all other patients. It is an example of price discrimination and is an informal way for patients in wealthier circumstances to subsidize patients with less financial resources.

Accepted Answer

This scenario is an example of price discrimination because the dentist charges different prices to different groups of patients based on their financial situation, allowing wealthier patients to indirectly subsidize the care of those with less financial means.

Question 9

Charging higher premiums to women of child bearing age than to men of the same age is an example of price discrimination.

Accepted Answer

This is probably due to a difference in the pricing of risk.

Question 10

The idea of comparative advantage and the rule that marginal productivity of physician office inputs per dollar spent should be equal over inputs are good in theory, but in practice may conflict with patient preferences.

Accepted Answer

Patients often want the doctor to spend more time with them, listening to their concerns and answering their questions. For doctors, however, it is not the most efficient means of spending of their time, and they often prefer to delegate this task to nurses or physician assistants.

Question 11

One of the advantages of belonging to a group practice is that it allows physicians to use their time more efficiently, compared to a solo practice.

Accepted Answer

In a group practice, physicians can share responsibilities and delegate tasks, allowing for more efficient use of time compared to managing all aspects of practice alone in a solo practice.

Question 12

One of the key provisions in the Patient Protection and Affordable care Act offers incentives to physician offices to implement electronic medical records (EMR). The idea behind EMR is to increase physicians' efficiency, as well as quality of patient care. It is an expensive technology, requiring a significant investment of time and financial resources, especially at startup. It is safe to predict that group practices will be less likely to adopt EMR, compared to physicians in solo practices.

Accepted Answer

It is easier for a group, rather than a solo practitioner, to take up a high-cost investment, where costs can be spread across several physicians. Larger-scale operations of a group practice will also allow faster return on investment.

Question 13

The total cost of attending medical school is covered by payments from all of the following sources except

Accepted Answer

The Stark Law, also known as the physician self-referral law, does not cover the cost of attending medical school. It is a federal law designed to limit the financial relationships between physicians and entities to which they refer patients for health services, to prevent conflicts of interest. It does not provide funding or payments for medical school costs.

Question 14

It is common for many fertility physicians to run their own individual offices where they see patients. It is also common for many of the same fertility physicians not to set up their own surgical and lab facilities, necessary for performing in-vitro fertilization (IVF), and other infertility treatments and procedures. Rather, many of them choose to share one well equipped facility. Which of the following must be true about the business organization in this particular sector?

Accepted Answer

The choice to share one well-equipped IVF lab/surgical facility among many fertility physicians suggests that doing so allows them to benefit from economies of scale, which means reducing costs by increasing the volume of services or procedures performed in a single facility.

Question 15

One of the best ways to learn how the complicated healthcare system in the U.S. works is to

Accepted Answer

Following the trail of money and understanding the self-interests of all parties involved provide a practical insight into the operations and motivations within the U.S. healthcare system, which is known for its complexity and the significant role of private interests.

Question 16

Two events that were most effective in bringing about licensure of physicians were

Accepted Answer

The development of effective anesthesia and antiseptics were pivotal in advancing medical practices, demonstrating the need for skilled, licensed physicians to properly utilize these innovations and ensure patient safety.

Question 17

Increasing the physician supply can be achieved through all the following ways except

Accepted Answer

Increasing the physician supply involves strategies that add more doctors to the workforce, such as increasing the number of medical schools (A), allowing more foreign graduates to train in the U.S. (B), changing immigration laws to allow more foreign physicians to practice (C), and providing more funding to medical schools to increase enrollment (E). Early retirement of practicing physicians (D) would decrease, not increase, the physician supply.

Question 18

When assessing the market demand and supply of physicians, economists look at all of the following except

Accepted Answer

Academic publication records of practicing physicians are not directly related to assessing the market demand and supply of physicians. This factor does not influence the overall availability of medical services or the need for physicians in the healthcare market.

Question 19

The Stark laws (1989 and 1993) ban physicians from referring patients to facilities in which the physician has a financial interest, such as a specialty hospital, radiation lab, or clinical lab. The Stark laws address

Accepted Answer

The answer of The Stark laws (1989 and 1993) ban...

Question 20

If a physician receives a bonus for referring a patient for cardiac surgery to a specialty hospital nearby his office,

Accepted Answer

The Stark Law prohibits physician referrals where the physician (or an immediate family member) has a financial relationship with the entity to which they are referring the patient, particularly for designated health services paid for by Medicare or Medicaid. Receiving a bonus for referring a patient to a specific hospital falls under this prohibition.

Quiz 7: Medical Education, Organization, and Business Practices