Healthcare Policy Test Bank
Course Introduction
Healthcare Policy examines the formulation, implementation, and impact of policies that shape healthcare systems at local, national, and global levels. The course explores the roles of government agencies, private organizations, and advocacy groups in setting healthcare priorities, financing care, regulating access and quality, and addressing disparities. Students analyze the political, economic, and social factors influencing policy decisions and evaluate key legislation affecting healthcare delivery. Through case studies and policy analysis, learners develop skills to critically assess current trends, propose innovative solutions, and understand the consequences of policy choices on patient care and public health outcomes.
Recommended Textbook
Health Economics 6th Edition by
Rexford E. Santerre
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16 Chapters
240 Verified Questions
240 Flashcards
Source URL: https://quizplus.com/study-set/3933
Page 2
Chapter 1: Introduction
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15 Verified Questions
15 Flashcards
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Sample Questions
Q1) Which of the following accounts for the greatest amount of health care spending?
A) Public health
B) Physician services
C) Prescription drugs
D) Nursing home care
E) Hospital services
Answer: E
Q2) Which of the following best describes productive efficiency?
A) Producing a medical service at the lowest possible cost.
B) Constructing a new medical facility to exactly offset a market shortage of such services.
C) Increasing the amount of hospital beds available such that each person in the population served has a bed allocated to him/her.
D) None of the above.
E) More than one of the above statements is true.
Answer: A
Q3) All points along the production possibilities frontier maximize equity.
A)True
B)False
Answer: False
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Chapter 2: Health and Medical Care: an Economic Perspective
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15 Verified Questions
15 Flashcards
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Sample Questions
Q1) The _______ states that distribution of income directly impacts health.
A) absolute income hypothesis
B) relative income hypothesis
C) relative position hypothesis
D) income inequality hypothesis
E) absolute position hypothesis
Answer: D
Q2) The concept of _______ helps explain why some people choose not to visit their primary care physician every day.
A) inseparability
B) human capital
C) diminishing marginal utility
D) process quality
E) absolute income hypothesis
Answer: C
Q3) Process quality refers to the physical and human resources of the medical care organization.
A)True
B)False
Answer: False
Page 4
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Chapter 3: Cost and Benefit Analysis
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15 Flashcards
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Sample Questions
Q1) Which of the following is not a method used in constructing a health-utility index?
A) rating scale
B) standard gamble
C) time trade-off
D) discounting
E) both b and d
Answer: D
Q2) Cost-utility analysis assumes that life-years added due to a medical intervention are homogeneous.
A)True
B)False
Answer: False
Q3) Rationality implies that people will always make the correct choice.
A)True
B)False
Answer: False
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Page 5
Chapter 4: Health Care Systems and Institutions
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Sample Questions
Q1) Which of the following refers to a situation where the health insurer reimburses 100% of the amount spent on medical services?
A) Patient Protection and Affordable Care Act of 2010
B) Managed care
C) Coinsurance
D) First dollar coverage
E) both c and d
Q2) A variable payment reimbursement system with low out-of-pocket expenses carries a _______ of large amounts of medical services.
A) High likelihood
B) Moderate likelihood
C) Low likelihood
D) Very low likelihood
E) None of the above.
Q3) Fee-for-service reimbursement systems help reduce health care expenditures.
A)True
B)False
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Chapter 5: The Demand for Medical Care
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Sample Questions
Q1) A negative income elasticity of demand for out-patient services would imply that it is an inferior good.
A)True
B)False
Q2) Larger deductible requirements decrease the risk of moral hazard.
A)True
B)False
Q3) The _______ refers to how many more or fewer people buy a product when its price changes.
A) intensive margin
B) extensive margin
C) nominal demand
D) effective demand
E) fuzzy demand
Q4) Time costs of acquiring medical care are considered _______.
A) direct non-medical costs
B) direct medical costs
C) opportunity costs
D) both a and b
E) both a and c
Page 7
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Chapter 6: The Demand for Medical Insurance: Traditional and Managed Care Coverage
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Sample Questions
Q1) Elimination of the tax-exempt status of employer-sponsored health insurance would most likely lead to a decrease in the purchase of health insurance.
A)True
B)False
Q2) An individual who is _______ would be indifferent to purchasing health insurance.
A) risk-averse
B) self-employed
C) unemployed
D) risk-neutral
E) risk-loving
Q3) Reduced coinsurance rates are likely to _______ moral hazard costs and _______ the risk exposure of the consumer.
A) increases; decreases
B) decreases; decreases
C) increases; increases
D) decreases; increases
E) None of the above
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Page 8
Chapter 7: Medical Care Production and Costs
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Sample Questions
Q1) Previously paid sunk costs do not factor into most decisions since they can't be recouped.
A)True
B)False
Q2) The _______ of nurses is represented as the change in medical services provided by an additional unit of nurse-labor.
A) marginal product
B) marginal cost
C) average product
D) opportunity cost
E) none of the above
Q3) _______ reflect the alternatives given up by using resources to produce medical services.
A) Marginal costs
B) Fixed costs
C) Explicit costs
D) Implicit costs
E) Variable costs
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9
Chapter 8: Structure, Conduct, Performance, and Market Analysis
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Sample Questions
Q1) Suppose that the inverse market demand for a new vaccine is P = 21,000 - 5Q, and the marginal cost is $10 per vaccine. Assuming that the manufacturer is profit-maximizing, what will be the market price of this new vaccine?
A) 15,000
B) 17,250
C) 15,750
D) 14,000
E) 13,500
Q2) An increase in consumer income will lead to an increase in the quantity of medical care supplied.
A)True
B)False
Q3) Collusion among firms is most likely to take place within which type of industry?
A) Perfect Competition
B) Monopolistic Competition
C) Oligopolies
D) Monopolies
E) None of the above
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Chapter 9: Government, Health, and Medical Care
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Sample Questions
Q1) A price ceiling will increase the quantity of medical care produced in a monopoly market.
A)True
B)False
Q2) If a price ceiling on physician services is going to be effective, it must be set ______ the competitive market equilibrium price to prevent the market from driving the price _______.
A) below; up B) below; down C) equal to; up D) above; down E) above; up
Q3) Penalties levied on consumers for the purchase of "Cadillac" health insurance plans are meant to correct for the positive externalities associated with these plans.
A)True
B)False
Q4) Medical care is a public good, as it is both non-rival and non-excludable.
A)True B)False
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Chapter 10: Government As Health Insurer
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Sample Questions
Q1) "Crowding out" due to an expansion of Medicaid requirements is best described by which of the following?
A) A family chooses to remain covered under employer-sponsored private health insurance.
B) An uninsured family chooses to enroll in Medicaid due to a low household income.
C) A family newly eligible withdraws from an employer-sponsored private health insurance and enrolls in Medicaid.
D) both b and c
E) none of the above
Q2) _______ is the principal catalyst for the provision of government intervention in the market for health insurance.
A) Uncertainty
B) Population growth
C) Disease prevalence
D) Imperfect information
E) Health expenditure growth
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Chapter 11: The Private Health Insurance Industry
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Sample Questions
Q1) Third-party payments provide incentives for the adoption of new technologies that may carry low benefits with high costs.
A)True
B)False
Q2) _______ is the situation where insured individuals alter their behavior because they are no longer financially responsible for the full cost of their behavior.
A) Moral Hazard
B) Asymmetric Information
C) Rationality
D) Scale Economies
E) Adverse Selection
Q3) _______ occurs when high-risk individuals subscribe to an insured group of low-risk individuals.
A) Moral Hazard
B) Asymmetric Information
C) Rationality
D) Scale Economies
E) Adverse Selection
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Chapter 12: The Physician Services Industry
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Sample Questions
Q1) The _______ suggests that per capita variations in the use of medical care are due to variations in physician preference for particular medical procedures.
A) physician practice hypothesis
B) supplier-induced demand hypothesis
C) enthusiasm hypothesis
D) principal-agent hypothesis
E) small area variation hypothesis
Q2) There is very little recent support for the existence of supplier-induced demand.
A)True
B)False
Q3) What are the two primary goals of the malpractice system?
A) Reduce the number of claims and deter negligence
B) Compensate victims and deter negligence
C) Reduce the number of claims and limit the size of awards
D) Increase the number of claims and compensate victims
E) none of the above
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Chapter 13: The Hospital Services Industry
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Sample Questions
Q1) _______ occurs when changes to prices charged to payers changes as a compensating response to changes in administered prices of a different payer.
A) Scale economies
B) Sunk cost
C) Cost-shifting
D) Moral hazard
E) Hospital services price inflation
Q2) Certificates of need promote price competition amongst hospitals.
A)True
B)False
Q3) Third-party payers representing a _______ market share have _______ negotiation power to obtain lower prices for hospital services.
A) small; greater
B) small; reduced
C) large; reduced
D) large; greater
E) both b and d
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Chapter 14: The Pharmaceutical Industry
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Sample Questions
Q1) _______ advertising is supported by evidence showing that _______ detailed advertising of older products tends to be targeted at younger physicians.
A) Informative; more
B) Persuasive; less
C) Informative; less
D) Persuasive; more
E) both a and d
Q2) Which of the following accounts for the largest share of expenditures on prescription drugs?
A) Private insurance
B) Medicare
C) Medicaid
D) Medigap
E) Out-of-pocket
Q3) High profits in the pharmaceutical industry may be a reflection of the greater risk incurred due to large research and development costs.
A)True
B)False
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Chapter 15: The Long-Term Care Industry
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Sample Questions
Q1) Which of the following is a provider of long-term care?
A) For-profit hospitals
B) Assisted living facilities
C) Senior centers
D) Non-profit hospitals
E) Both b and c
Q2) Which of the following might cause an increase in the demand for long-term care?
A) Aging population
B) Increased prevalence of HIV
C) Advances in medical technology
D) Increased utilization of primary care
E) Increased health
Q3) Scale economies allow long-term care facilities to substantially decrease costs with only slight quality reductions.
A)True
B)False
Q4) The market demand for long-term care represents a derived demand.
A)True
B)False
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Chapter 16: Health Insurance Reform
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Sample Questions
Q1) Which of the generic health plans would best eliminate the problem of moral hazard?
A) Managed competition
B) National health insurance
C) Medical savings accounts
D) Individual mandates
E) Both a and c
Q2) Which of the following is a generic health plan proposed for health reform?
A) Medical savings accounts
B) Third-party payers
C) Resource-based relative value system
D) Diagnosis-related groups
E) Fee-for-service
Q3) A national health insurance plan would provide significant cost advantages through scale economies.
A)True
B)False
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