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CEBS GBA Exam 2/305 Answered Questions & Answers
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CEBS GBA Exam 2/305 AnsweredQuestions & Answers 2023-2024
What is the basic assumption underlying concept of a free market and how is
it challenged by the theory of "bounded rationality?" (Mod 1.1) - -
Assumption that rational customers will make informed decisions about
value, quality and price, while producers who meet consumer's demands will
be rewarded with market share and profit. However this is challenged by the
consumer's "bounded rationality" - rational consumer is only functional up to
a certain point because choices are constrained or bound by limited
knowledge and understanding of their choices.
-What are economic benefits of a free market? (Mod 1.1) - -If an individual
does not like their provider or health plan, the should be able to "vote with
their feet" and select other options. This choice empowers customers,
regulates producers and drives efficiency.
-Describe several ways the US Healthcare market does not function like a
normal market. (Mod 1.1) - -Healthcare market has significant asymmetry in
information between consumers, providers and insurers. Moral hazard is a
problem because the marginal cost of covered care is zero, causing some to
overconsume medical care. Many consumers choose doctors initially by
convenience, accessibility or recommendation. Cost has also been shown to
be lower on priority scale for choosing a provider.
-List several recent initiatives in the US that purport (to claim, often falsely)
to use market forces to increase efficiency in the healthcare system. (Mod
1.1) - -1) Employers are offering more HDHPs with some as high as $10,000.
These plans, often paired with HSAs, are coupled with the idea of
transparency, or making more info available to consumer on cost and
quality. Idea is that consumers will have more skin in game and be prudent
purchasers of care with their own money.
2) ACA is creating marketplaces that employ a form of managed competition
where standardized health plans compete on cost and quality.
3) Public Medicaid and Medicare programs are moving towards requiring or
making choices available for managed care products that structure care
within provider networks.
-Indicate the approximate percentages of the population covered by major
health programs. (Mod 1.2) - -Largest portion of Americans (48%) receive
health insurance through an Employer, 16% through Medicaid, 15% through
Medicare, 6% purchase insurance on their own
, -How did ACA change Medicare? (Mod 1.2) - -ACA expanded Medicare's
wellness and prevention benefits, improved prescription drug coverage and
financed experiments to control health care costs by testing alternative
payment methods and delivery systems.
-How did ACA change eligibility for Medicaid benefits and how is this change
affecting the number of people who are enrolled? (Mod 1.2) - -ACA shifted
program eligibility from category based (ex: single parents with dependents
or people w/disabilities) to an income-based standard. Medicaid once
covered fewer than half of low-income Americans, but now ACA Medcaid
expansion has been steadily increasing enrollment, with largest increase in
the states who are participating.
-Explain significance of US Supreme Court case National Federation of
Independent Business v Sebelius in 2012 (Mod 1.2) - -ACA sought to expand
Medicaid coverage to all individuals and families with incomes below 138%
of the poverty level. US (first time) would have had a solid safety net of
insurance coverage for all lower income citizens. In the case, the court rules
states could choose not to expand (and Medicaid funding would not be
withheld). By Jan 2015, 25 states chose not to expand.
-How has ACA affected number of uninsured Americans? (Mod 1.2) - -Prior
to ACA, 16.3% or 49.9 million Americans were uninsured. By 2014, this
number reduced to 13% and by the first quarter of 2016 to 8.6%.
-Describe private health insurance coverage with regard to a) size of firm
b) HDHPs with Medical Savings Accounts
c) variability of coverage by states (Mod 1.2) - -a) 98% of employers with
200+ EE's offer health insurance but fewer than 45% of firms with 3-9 EE's
do so. Larger employers offer more choice of health plans than smaller
employers; small employers tend to offer POS plans that require higher EE
cost sharing to go outside network.
b) In 2006, HDHPs with medical savings accounts accounted for 4% of ER-
sponsored market, but by 2012, accounted for over 20%. In 2016, this rose
to almost 30%.
c) Range of ER-based options and quality of options available vary widely by
state. The percentage of the population covered by private insurance varies
as well as the options for different types of coverage.
-What are the basic differences between the four medal categories of ACA
health plans? (Mod 1.3) - -Bronze, Silver, Gold and Platinum plans all have
same actuarial value. However, they differ in regard to amount of
deductibles, coinsurance, other out of pocket costs and premiums. Bronze
plan has lowest premium but most out of pocket costs. Platinum plan has
lowest out of pocket cost, but highest premium.
, -Why is the Silver Plan the most popular choice among ACA plans? (Mod 1.3)
- -Majority who enroll are eligible for federal tax credit subsidies tied to a
Silver level plan. People may still select a higher cost Gold or Platinum plan,
but will have to pay higher premiums. Cost-sharing subsidies to lower out of
pocket costs are only available to Silver plans.
-Do users of ACA marketplace exchanges have many choices and does
evidence indicate they choose the most cost-effective plans? (Mod 1.3) - -
Ton of choices and options (ex: in TX, 15 carriers offered an average of 31
plans per county). A consumer comparing plans may see different premiums,
coinsurance and deductibles, but plans also may differ on every measure of
out of pocket costs including physician copays, ER payments, hospital stay
payments. Studies have found despite wide range of benefits, people are not
choosing most cost-effective plans....people on average choose plan 10%
more expensive than what would be optimal. Other studies suggest limiting
variation in plan designs would be choices more comprehensible (able to
understand).
-What is the provision in Part D Medicare law that gives a significant benefit
to pharmaceutical companies? (Mod 1.4) - -Part D Medicare Law prohibits
the government from using its purchasing power to negotiate widespread
discounts with drug plans.
-Do Medicare Part D beneficiaries have many choices and does the evidence
suggest they choose the most cost-effective plans? (Mod 1.4) - -Provide
numerous choices (ex MA has 27 standalone, TX has 32). Most people do not
select the optimal plan or take advantage of open enrollment periods to
obtain a more cost-effective plan. Few people switch plans even when it
would be in their advantage to do so.
-Define each part of Medicare (A,B,C,D) and the services provided under
each (Mod 1.4 - Reading) - -Part A = Hospital Services
Part B = Physician & Diagnostic Services
Part C = Medicare Advantage - Alternative Managed Care Option
Part D = Prescription Drugs
-Greatest choices in Part D and the Medicare Advantage Plan, which is where
most of analysis is focused on.
-C and D are paid out of pocket by recipients; A & B are funded by payroll
deductions (taxes)
-What is Medicare Part C and why do some people select it? (Mod 1.4) - -
AKA Medicare Advantage:
-Recipients have the option to enroll in a health plan with a narrowed
network of hospitals and providers that covers Part A and B but with lower
out of pocket costs. These plans often include their own prescription drug
coverage. Unlike Part D, this is a voluntary choice and beneficiaries always
, have the option of going back to the traditional plan. It is a choice to restrict
options and consolidate the different elements of Medicare, including cost
sharing.
People select these plans because of lower costs and greater care
coordination. Like Part D, Part C has significant state variation.
-What have researchers found with regard to consumer benefits and
efficiency of Medicare Part C? (Mod 1.4) - -45 studies - in general that Part
C's HMO and PPO programs have a better record than traditional fee for
service plans in the provision of preventive services and the more efficient
use of resources. Despite high performance, a sub-group of sick beneficiaries
in traditional Medicare tends to rate their care more favorably than
beneficiaries in Part C - due to easier access to specialists. Compared to Part
D (which provides a separate, uncoordinated prescription drug benefit),
choice here is less complex and could lead to greater consumer benefits and
efficiency.
-Discuss consumer choices for Physicians and Hospitals in the Medicaid
Program (Mod 1.4) - -Federal government mandates open choice to both
Phys & Hospitals; however, in the 90s, states could obtain waivers for this
provision and require Medicaid recipients to enroll in a limited-network
managed care plan (most states did).
Continued movement to Medicaid Managed Care Organizations (MMCOs) -
with comprehensive coverage paid on a risk basis.
MMCOs receive a per-member, per-person payment to provide defined set of
benefits for all. Traditionally, Medicaid pays physicians much less than
private insurance or Medicare - this limits the number of physicians who may
take Medicaid, which will limit choice.
-What is the difference between Medicare and Medicaid? (Mod 1.4 -
Reading) - -Medicare: Medicare is a federal program attached to Social
Security. It is available to all U.S. citizens 65 years of age or older and it also
covers people with certain disabilities. It is available regardless of income.
Medicaid: Medicaid is a joint federal and state program that helps low-
income individuals and families pay for the costs associated with medical
and long-term custodial care. The federal government funds up to 50% of the
cost of each state's Medicaid program, with more affluent states receiving
less funding than less affluent states. Because of this federal/state
partnership, there are actually 50 different Medicaid programs, one for each
state.
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