Use the following to answer question(s): Third-Party Payers

-(Exhibit: Third-party payers) At a price of $60 with a third party payer, the total cost of health-care services compared to the price that would prevail if there were no third-party payers has:
A) decreased from $180 million to $80 million.
B) increased from $80 million to $180 million.
C) decreased from $180 million to $80 million, and consumers pay $60 million
D) increased to $180 million, and insurance pays $60 million.

Question

Use the following to answer question(s): Third-Party Payers
 
-(Exhibit: Third-party payers) At a price of $60 with a third party payer, the total cost of health-care services compared to the price that would prevail if there were no third-party payers has:
A) decreased from $180 million to $80 million. 
B) increased from $80 million to $180 million. 
C) decreased from $180 million to $80 million, and consumers pay $60 million 
D) increased to $180 million, and insurance pays $60 million.

Quizplus · Accepted Answer

The presence of third-party payers in healthcare often leads to an increase in the total cost of health-care services due to reduced price sensitivity among consumers, who are less concerned about costs when a third party covers a significant portion of the bill. This can lead to higher demand and increased prices, thus increasing the total cost from a lower figure (e.g., $80 million) to a higher one (e.g., $180 million).

Use the Following to Answer Question(s): Third-Party Payers