Transactions Costs. Humana, Inc., offers managed health care products which integrate management with the delivery of health care services through a network of providers, who in their delivery of quality medical services, may share financial risk or who have incentives to deliver cost-effective medical services. It also offers administrative services products including group life, dental, disability income, workers' compensation, and pharmacy management services.
A. Use transactions costs to explain the existence of HMOs like Humana.
B. When will less formal contracting arrangements supplant the need for a formal corporate structure?

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The Answer of Transactions Costs. Humana, Inc., offers managed health care products which integrate management with the delivery of health care services through a network of providers, who in their delivery of quality medical services, may share financial risk or who have incentives to deliver cost-effective medical services. It also offers administrative services products including group life, dental, disability income, workers' compensation, and pharmacy management services.
A. Use transactions costs to explain the existence of HMOs like Humana.
B. When will less formal contracting arrangements supplant the need for a formal corporate structure?