How did physicians accepting Medicare assignments cause price discrimination?

Question

Quizplus · Accepted Answer

The Answer is The introduction of different insurance reimbursement rates allowed physicians to practice third-degree price discrimination.For example,a physician accepting Medicare assignment was paid 80% of their approved fee by Medicare,and the patient was responsible for the remaining 20% co-payment,which had to be paid directly to the physician (in addition to a small annual deductible).A physician not accepting Medicare assignments billed the patient for the entire fee,which was greater than the Medicare-approved fee.The patient then paid the entire fee directly to the physician and was reimbursed by Medicare for only 80% of the approved fee.Thus,the patient was responsible not only for the 20% co-payment of the approved fee,but also for the difference between the approved fee and the physician's charge.This difference was referred to as "balance billing."

How Did Physicians Accepting Medicare Assignments Cause Price Discrimination