Asked by Jayesh Reesaul on Jun 12, 2024
Verified
Medicare and Medicaid set their payment rates for medical services above marginal cost, but below average total cost. One major consequence of doing this is that hospitals and other providers are then
A) reducing the amount of health care services they provide.
B) passing the uncovered costs on to patients with private health insurance.
C) denying services to many Medicare and Medicaid patients.
D) filing for bankruptcy regularly.
Marginal Cost
The cost of producing one additional unit of a good or service, a crucial concept for understanding economic decision-making.
Average Total Cost
The total cost of production divided by the number of goods produced, indicating the cost per unit of output.
- Acquire knowledge about the techniques employed or advised to control healthcare costs.
Verified Answer
RM
Roxanne MojicaJun 18, 2024
Final Answer :
B
Explanation :
When Medicare and Medicaid reimburse hospitals and providers at rates that do not cover the average total cost of providing services, these providers often compensate for the shortfall by charging higher rates to patients with private insurance. This practice helps them balance their finances by offsetting the lower payments received from government programs.
Learning Objectives
- Acquire knowledge about the techniques employed or advised to control healthcare costs.
Related questions
In Addition to the Cost of Providing Care to Patients,which ...
One Cause of the Increase in Health Care Cost Is ...
Similar to the United States,which of the Following Nations Spends ...
Benefits of the Affordable Care Act (ACA)have Been Categorized in ...
American-Style Healthcare Is Expensive Because It Emphasizes ...