A company switches from a medical plan that covered all medical costs to a medical plan with a high deductible, making employees responsible for the first $1,500 of health care costs. Other things the same, a higher deductible is expected to:
A) reduce both medical claims and hospital admissions.
B) increase both medical claims and hospital admissions.
C) reduce medical claims and increase hospital admissions.
D) increase medical claims and reduce hospital admissions.

Question

Quizplus · Accepted Answer

A higher deductible plan makes employees more cost-conscious, leading to reduced medical claims and hospital admissions as they may avoid or delay seeking medical care to avoid out-of-pocket expenses.

A Company Switches from a Medical Plan That Covered All