Question 1

Stark I prohibited physician referrals to entities in which they held financial interest.

Accepted Answer

The Stark Law, also known as the Physician Self-Referral Law, prohibits physicians from referring patients to entities with which they have a financial relationship for certain designated health services.

Question 2

Stark II regulations of 2007 allows medical groups to impose practice restrictions of a limited nature on recruited physicians

Accepted Answer

The Stark II regulations, specifically the 2007 amendments, allow medical groups to impose certain limited practice restrictions on recruited physicians, such as non-compete clauses, as long as they comply with specific conditions outlined in the regulations.

Question 3

Stark II limited the geographically area in which a rural hospital could recruit a physician.

Accepted Answer

Stark II, also known as the Physician Self-Referral Law, primarily addresses financial relationships and referrals, not geographic limitations for physician recruitment by rural hospitals.

Question 4

The Federal Trade Commission does not generally challenge the merger of acute care hospitals if one of the hospitals has fewer than two hundred licensed beds and an average daily census of 40 patients per day.

Accepted Answer

The Federal Trade Commission (FTC) evaluates hospital mergers on a case-by-case basis, considering factors like market concentration and potential anti-competitive effects, regardless of the size of the hospitals involved.

Question 5

The Federal Trade Commission has a safety zone whereby it will not challenge the merger of acute care hospitals of a certain size and average daily census, but it does not apply if the hospital is less than five years old.

Accepted Answer

The safety zone does not apply to hospitals less than five years old.

Question 6

Older consumers have recently been found to be as adept at using patient portals as younger consumers.

Accepted Answer

Research generally indicates that older consumers may face more challenges with technology, including patient portals, compared to younger consumers, due to factors like less familiarity with digital tools and potential physical limitations.

Question 7

The adoption of EHRs among smaller rural hospitals in the U.S. still lags at a level below 50%.

Accepted Answer

As of recent years, the adoption of Electronic Health Records (EHRs) among smaller rural hospitals in the U.S. has increased significantly, surpassing 50%.

Question 8

Merger activity in the health care industry has begun to drop since the cost of capital increased in 2015.

Accepted Answer

The statement is incorrect as it suggests a continuous decline in merger activity since 2015, but merger activity can fluctuate due to various factors, not solely due to the cost of capital.

Question 9

Patients going overseas for healthcare are people who tend to be underinsured or uninsured as well as those with high deductibles.

Accepted Answer

Medical tourism often attracts individuals who seek more affordable healthcare options, including those who are underinsured, uninsured, or facing high out-of-pocket costs.

Question 10

Domestic medical tourism is a trend that means attracting people from overseas into the domestic U.S. market for healthcare.

Accepted Answer

Domestic medical tourism refers to U.S. residents traveling within the country to receive medical care, not attracting international patients.

Question 11

Consumers are now able to get outcome data on hospitals from both federal and state regulators.

Accepted Answer

Federal and state regulators have made hospital outcome data more accessible to consumers, allowing them to make informed decisions about healthcare providers.

Question 12

Transparency in health care has led to third party rating agencies that are certified by government regulators publish price and quality data on health care providers.

Accepted Answer

The answer of Transparency in health care has led to...

Question 13

Certificate of need requirements was a state regulation that required regulatory approval before capital expenditures could be made by a health care organization for programs of a certain dollar size.

Accepted Answer

Certificate of need (CON) laws are state-level regulations that require health care providers to obtain approval before making significant capital investments, such as expanding facilities or adding new services, to ensure that the proposed projects meet a community need and to control health care costs.

Question 14

Brand identify is a strong marketing concern but can never be an effective barrier to entry as it is easy for a competitor to counter.

Accepted Answer

Brand identity can be a significant barrier to entry as it creates customer loyalty and recognition, making it difficult for new competitors to attract the same customer base.

Question 15

Wal-Mart has brand identity as its significant barrier to entry for competitors.

Accepted Answer

The answer of Wal-Mart has brand identity as its significant...

Question 16

As health care systems began to acquire physician practices and form large integrated group practices within their ownership, the health systems were attempting to develop a distribution access barrier to entry.

Accepted Answer

Health systems acquiring physician practices aim to create integrated networks that can limit competition by controlling patient referrals and access to healthcare services, thus creating barriers to entry for other providers.

Question 17

Service that is expensive or requires significant capital outlay is in and of themselves a barrier to entry.

Accepted Answer

High costs or significant capital requirements can deter new competitors from entering a market, thus acting as a barrier to entry.

Question 18

Patient portals that are developed for patients and referral physicians are trying to create a barrier to entry around switching costs.

Accepted Answer

Patient portals are designed to make it easier for patients to access their medical records and communicate with their doctors. By creating a barrier to entry around switching costs, patient portals can discourage patients from switching to a different provider.

Question 19

The premium dollar to cover employees is growing at a higher rate for large firms than for smaller firms under 200 employees per annum, leading these larger firms to move to high deductible health care plans to cover employees.

Accepted Answer

The statement is not universally true as the growth rate of premium dollars can vary based on multiple factors, and larger firms often have more negotiating power and resources to manage healthcare costs, potentially leading to different trends in premium growth compared to smaller firms.

Question 20

Although consumers may be in a high deductible health care plan, there is still a tendency for them to not talk to their physician about the cost of treatment when it is needed.

Accepted Answer

Many consumers avoid discussing costs with their physicians due to discomfort, lack of awareness, or the assumption that physicians may not have the information or ability to alter costs.

Quiz 3: The Challenge of a Competitive Marketplace