Third-party payments have led to an increase in the price and quantity of health care in the United States.

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Third-party payments refer to payments made by someone other than the patient and healthcare provider, such as insurance companies or government programs. With third-party payments, patients may not have as much incentive to moderate their healthcare spending, leading to increased utilization of health services. Additionally, healthcare providers may be incentivized to provide more services or charge higher prices when payment is coming from a third-party payer rather than directly from the patient. These factors have contributed to an increase in the price and quantity of healthcare in the United States.

Third-Party Payments Have Led to an Increase in the Price