Deck 16: Health Insurance Ii- Medicare, medicaid, and Health Care Reform

Question 1

Which of the following provides coverage for prescription drug expenditure for the elderly?

A) Medicare Part A
B) Medicare Part B
C) Medicare Part D
D) Medicaid

Answer 1

Medicare Part D

Question 2

The Children's Health Insurance Program introduced in 1997:

A) expanded Medicaid's medical coverage of children to include prescription drugs.
B) expanded eligibility of children for public health insurance.
C) mandated that the states ensure that every child is covered by health insurance.
D) replaced Medicaid with private insurance for all eligible individuals.

Answer 2

expanded eligibility of children for public health insurance.

Question 3

Medicare provides health insurance only to:

A) poor families.
B) all elderly over age 65.
C) poor individuals over the age of 65.
D) those who lost their health insurance coverage prior to retirement.

Answer 3

all elderly over age 65.

Question 4

What is the effect of adverse selection in a premium support system for Medicare?

A) It raises the costs to the sickest individuals.
B) It raises the costs to the healthiest individuals.
C) More individuals choose the higher level of insurance coverage.
D) Premiums are reduced for everyone.

Question 5

Which statement is TRUE?

A) Medicaid rules require states to cover prescription drugs for Medicaid recipients.
B) Medicaid recipients receive dental benefits in fewer than half of the states.
C) There are significant copayments associated with the prescription drug benefits under Medicaid.
D) Medicaid only covers services provided in a hospital emergency room.

Question 6

As a result of the move to a Prospective Payment System:

A) the treatment intensity of the elderly was significantly increased.
B) the rate of growth of hospital costs fell significantly immediately after the PPS was implemented.
C) mortality rates increased.
D) there were no major changes in coverage or costs.

Question 7

Which of the following is TRUE regarding the cost-effectiveness of the Medicaid expansions?

A) It costs Medicaid more to save an infant life than the estimates of the value of a life found by compensating differential studies.
B) It costs Medicaid less to save an infant life than it does to save a life through seat-belt safety.
C) It is not possible to save an infant life simply by spending more on Medicaid.
D) The cost of saving an infant life far exceeds the benefit of saving this life.

Question 8

Which statement is TRUE with respect to Medicare?

A) The part of Medicare that covers inpatient hospital costs and some costs of long-term care is financed largely through a payroll tax.
B) The part of Medicare that covers physician expenditures and outpatient hospital expenditures is financed largely through a payroll tax.
C) Medicare recipients must pay a premium to receive coverage of inpatient hospital costs.
D) Medicare recipients are not able to purchase additional coverage beyond the basic plan provided by the program.

Question 9

Medicaid provides health insurance to:

A) some low-income individuals.
B) all elderly over age 65.
C) disabled persons under age 65.
D) disabled persons over age 65.

Question 10

Medicare is administered by ___________ and is financed by ____________.

A) states; general revenues
B) states; a payroll tax
C) federal government; general revenues
D) federal government; a payroll tax

Question 11

Which statement reflects the findings of empirical studies of Medicaid?

A) Infant mortality was not affected by the expansion of Medicaid coverage to pregnant women.
B) The crowd-out effect of Medicaid on private insurance exceeds 50%.
C) The crowd-out effect of Medicaid on private insurance is below 50%.
D) Low-income families have the same health outcomes whether or not they apply for and receive Medicaid.

Question 12

Which of the following describes the prescription drug benefit that Medicare began offering in 2006?

A) The benefit to seniors increases steadily as annual prescription spending is increased.
B) The benefit decreases steadily as annual prescription spending is increased.
C) The benefit to the 1% of seniors with the highest prescription drug costs is greater than the benefit to the 1% of seniors with the lowest prescription drug costs.
D) The benefit to the 1% of seniors with the highest prescription drug costs is less than the benefit to the 1% of seniors with the lowest prescription drug costs.

Question 13

The Patient Protection and Affordable Care Act:

A) requires each state to expand Medicaid coverage to anyone who is uninsured.
B) bans insurers from denying coverage for pre-existing conditions.
C) forces health care providers to reduce fees in order to control rising costs.
D) protects doctors and hospitals from malpractice lawsuits.

Question 14

Which of the following implies that public insurance programs may not improve health insurance coverage?

A) Many of those eligible for the public insurance already had private insurance.
B) Few of those eligible for the public insurance already had private insurance.
C) Some but not all of the people who did not have insurance and are eligible for public insurance will enroll in the program.
D) Those who have health insurance are more likely to seek medical treatment.

Question 15

Which of the following best explains the structure of the recently passed prescription drug benefit?

A) The government chose the optimal insurance design structure.
B) The government maximized the benefit to low-income seniors.
C) The government chose the cost-minimizing design.
D) The government chose to deliver benefits to as many seniors as possible.

Question 16

Which of the following is an advantage of a premium support system for Medicare enrollees?

A) It would impose government's preferences on individuals.
B) It would promote efficiency by introducing competition.
C) It would lower overall costs by reducing adverse selection.
D) It would lower moral hazard by allowing only the healthiest individuals to enroll for Medicare.

Question 17

Medicaid is administered by the ___________ and is financed by ____________.

A) states; general state and federal revenues
B) states; a payroll tax levied on employees and employers
C) federal government; general state and federal revenues
D) federal government; a payroll tax levied on employers

Question 18

Which statement is TRUE with respect to the expansions of Medicaid in the 1980s and 1990s?

A) More than half of those made eligible as a result of those expansions enrolled in the program.
B) More than half of those made eligible as a result of those expansions already had private health insurance coverage.
C) The percentage of individuals under age 18 who were eligible for Medicaid more than doubled as a result of the Medicaid expansions.
D) None of those made eligible as a result of those expansions had private health insurance coverage.

Question 19

Which of the following is TRUE of the prospective payment system?

A) It was established in 1996.
B) Hospitals that treated many fewer poor patients received higher reimbursements for the same services relative to other hospitals.
C) All diagnoses for hospital admissions were grouped into one of several hundred groups on which reimbursement was based.
D) Reimbursements were based on services provided rather than the patient's diagnosis.

Question 20

Suppose that to estimate the effect of Medicaid on health status,a researcher compares those who choose to enroll in the program to those who are not enrolled.Which of the following would cause the resulting estimate to be biased?

A) Eligibility for Medicaid is established by factors that might also affect health.
B) Eligibility for Medicaid is established by factors that do not affect health.
C) Those who enroll in Medicaid are likely to receive more access to medical care than those who do not enroll.
D) Access to health care is likely to have a significant impact on an individual's overall health.

Question 21

Suppose that individuals have private information about the likely risk of going into a nursing home.This will directly cause:

A) moral hazard in the market for long-term care insurance.
B) adverse selection in the market for long-term care insurance.
C) a reduction in the average cost of long-term care insurance.
D) increased demand for long-term care insurance by those who are least likely to go into a nursing home.

Question 22

Which of the following is a likely consequence of the current system of financing long-term care?

A) Individuals are more likely to opt for long-term care
B) Individuals have an incentive to hide their wealth
C) Individuals have less incentive to donate to charity
D) The current system does not affect individual incentives

Question 23

Most private health insurance plans have out-of-pocket limits,which limit the total amount an insured individual must pay in any given year.For example,a plan may have a 10% copayment on all medical services and a $5,000 out-of-pocket limit.If an individual insured under that plan incurs $60,000 of medical expenses in one year,the individual will pay 10% of the first $50,000 ($5,000),after which the insurer will pay 100% of expenses.Medicare does not have an out-of-pocket limit.Suppose the government is considering adding an out-of-pocket limit.What are the advantages of doing so? What are the disadvantages of doing so?

Question 24

A public national health insurance system would:

A) solve the problem of the uninsured.
B) worsen the problem of the uninsured.
C) have no effect on the problem of the uninsured.
D) raise per-person administrative costs of health insurance.

Question 25

Individuals who enter nursing homes are expected to pay first using:

A) personal savings.
B) private long-term care insurance.
C) Medicaid coverage.
D) Medicare coverage.

Question 26

Since 1980,long-term care has shifted toward ____________,which makes up __________ of overall long-term care costs.

A) home health care; 31%
B) home health care; 73%
C) institutional care; 30%
D) institutional care; 50%

Question 27

A public national health insurance system likely will:

A) not resolve the problem of job lock.
B) not reduce the administrative costs associated with the health insurance system.
C) require massive new government expenditures.
D) put a stop to rising health care costs.

Question 28

Which of the following techniques is NOT used to control cost?

A) a cap on the tax exclusion to employer-provided insurance for the highest-cost health insurance plans
B) introduction of competitive health insurance exchanges
C) pilot programs of alternative structures for organizing and reimbursing health care providers
D) exclusion of certain elderly individuals,especially those who are in the last six months of their life

Question 29

Approximately what percentage of total health-care spending was spent on long-term care in 2007?

A) 2%
B) 8.5%
C) 17%
D) 31%

Question 30

The textbook identifies three reasons why the prospective payment system (PPS)did not solve the long-run cost growth problems of Medicare.Describe two of those problems.

Question 31

When an individual in a nursing home can no longer afford the care,what typically happens?

A) The individual is removed from the nursing home.
B) The individual pays for it using a recently purchased long-term care insurance policy.
C) The individual's nursing home costs are covered under Medicaid.
D) The individual's nursing home costs are covered under Medicare.

Question 32

Which of the following is NOT primarily intended to address the problem of insuring people who don't have health insurance?

A) mandates that employers offer insurance or individuals buy insurance
B) subsidies to the poor
C) increased pooling of small business employees across states
D) reducing deductibles and copays for all insurance policies

Question 33

Suppose that an elderly person can no longer take care of herself and therefore receives care through nurses and aides that visit the person at home.This is:

A) institutional care.
B) acute care.
C) home health care.
D) the most expensive type of long-term care.

Question 34

Which of the following is NOT a provision of the Patient Protection and Affordable Care Act of 2010?

A) elimination of price discrimination against the sick by banning denial of coverage because of preexisting conditions
B) mandates that employers offer insurance or individuals buy insurance
C) health insurance coverage subsidies for the poor
D) insurance prices to vary by age and health history

Question 35

Which of the following has been found to be the primary cause of the rapid rise in health care costs?

A) moral hazard
B) corruption and mismanagement
C) obesity
D) technological change in the delivery of health care

Question 36

Institutional care is provided in __________ and accounts for __________ of long-term care costs.

A) the patient's home; 25%
B) the patient's home; 75%
C) nursing homes; 25%
D) nursing homes; 69%

Question 37

Which of the following is an effect of the current system of financing long-term care?

A) Assets are implicitly taxed.
B) Individuals have an incentive to save more as they get older.
C) Individuals give larger bequests when they die than they would otherwise.
D) There is an incentive for individuals to seek more long-term care.

Question 38

Compare and contrast the differences between Medicaid and Medicare with respect to eligibility,premiums,deductibles,copayments,and services excluded from each program.

Question 39

How are the providers of health care services to Medicaid recipients paid? Has this affected the health care experiences of Medicaid recipients? Explain.

Question 40

Practicing medicine on the flat of the curve implies that the _________ value of medical treatment is exceeded by the __________ cost of treatment.

A) average; average
B) median; median
C) marginal; marginal
D) average; marginal

Question 41

Discuss the three-legged-stool approach of Massachusetts' experiment with incremental universalism.What were the consequences of the three-legged-stool implementation? How does this experience compare to the ACA?

Question 42

Suppose that in response to learning that some sick individuals were denied health insurance,the government mandates that insurance companies offer insurance to everyone at unregulated rates.
(a)Do you think that this would help reduce the number of uninsured? Explain.
(b)An alternative strategy for reducing the number of uninsured might be to mandate that insurance companies charge individuals with health problems no more than individuals without health problems.Would this help reduce the number of uninsured? Explain.