Which of the following would encourage consumers to economize on their use of healthcare and producers to provide it more efficiently?
A) a reduction in out-of-pocket healthcare expenditures
B) government subsidies that encourage people to purchase health insurance policies with first-dollar coverage and small co-payments
C) Medicare reform that at least partially substituted defined benefits (funds that could be used to pay for healthcare or the purchase of insurance) for the present cost reimbursement system
D) all of the above

Question

Quizplus · Accepted Answer

Medicare reform that substitutes defined benefits for the present cost reimbursement system provides consumers with incentives to choose cost-effective healthcare options, and producers with incentives to operate more efficiently. A reduction in out-of-pocket expenditures might encourage more healthcare utilization, while government subsidies can discourage consumers from seeking the most cost-effective options.

Which of the Following Would Encourage Consumers to Economize on Their