Asked by Jeannie Howell on Jun 12, 2024
Verified
How does the federal government avoid the asymmetric information problem associated with providing health care to people over 65 years of age?
A) Health care is standardized and is the same for all people over 65 years of age.
B) Health insurers rely on the reputation of the covered individuals.
C) Participation in the Medicare program is mandatory for all people over 65 years of age.
D) Health information about people enrolled in the Medicare program is publically available.
Asymmetric Information
A situation where one party in a transaction has more or superior information compared to another, leading to imbalances in transactions.
Federal Government
The national government of a federal country, which holds the authoritative power to govern the nation as a whole, distinct from regional or state governments.
Medicare Program
A federal health insurance program in the United States for people who are 65 or older, certain younger people with disabilities, and people with End-Stage Renal Disease.
- Recognize the role of government interventions in reducing information asymmetry.
Verified Answer
Learning Objectives
- Recognize the role of government interventions in reducing information asymmetry.
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