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Chapter 30: Q.c - For Critical Thinking (page 684)
Who provides the more than $100 billion that Medicare spends on prescription drugs each year?
The taxpayers provide the money.
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The area labelled A is one-fourth of the area denoted B. What is the value of the Gini coefficient?
Suppose that a group of physicians establishes a joint practice in a remote area. This group provides the only health care available to people in the local community, and its objective is to maximize total economic profits for the group's members. Explain how the price and quantity of health care will be determined in this community. (Hint: How does a single producer of any service determine its output and price?)
Some economists have argued that if the government wishes to subsidize health care, it should instead provide predetermined amounts of payments (based on the type of health care problems experienced) directly to patients, who then would be free to choose their health care providers. Whether or not you agree, can you give an economic rationale for this approach to governmental health care funding?
Estimates indicate that in recent years, the poorest 40 percent of the population earned about 15 percent of total income in Argentina. In Brazil, the poorest 40 percent earned about 10 percent of total income. The next-highest 30 percent of income earners in Argentina received roughly 25 percent of total income. In Brazil, the next-highest 30 percent of income earners received approximately 20 percent of total income. Can you determine, without drawing a diagram (though you can if you wish), which country's Lorenz curve was bowed out farther to the right?
Take a look at both Figure 30-8 and Figure 30-9. When health care programs such as Medicare, Medicaid, and the Affordable Care Act's health exchange system were created, Congress based projected costs on quantities of health care consumed at the time the programs were implemented. Was this a reasonable assumption given that the programs all cut out-of-pocket payments for beneficiaries? Explain.
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