L22: Health Insurance

Question 1

deductibles

Answer 1

limit to cost individual pays

Question 2

copayment

Answer 2

fixed payment individual pays

Question 3

coinsurance

Answer 3

% of each bill individual pays

Question 4

why employers provide private insurance in the US

Answer 4

fringe benefit for workers accelerated by wage and price controls during WWII

historical accident starting in California with Kaiser Permanente

Question 5

advantages of employer-provided insurance

Answer 5

risk pooling
- insurance markets function more effectively with large groups (greater certainty about average costs) and less adverse selection (since all employees are enrolled)

tax incentive
- employer provided health insurance is a non-taxable frm of compensation

Question 6

disadvantage of employer provision

Answer 6

discourages individuals from switching jobs if other employers don’t offer coverage, workers have preexisting conditions or job searches require a period of unemployment

job lock: unwillingness to move to a better job for fear of losing health insurance

Question 7

nongroup direct insurance market

Answer 7

market through which individuals or families buy insurance directly rather than through a group

doesn’t really exist after ACA

Question 8

issue with nongroup insurance

Answer 8

adverse selection

insurers assume everyone who wants to buy healthcare is high risk since there’s no other purpose to buying insurance