Question

Please look at Figure 20.6 on page 530 of The Economics of Health and Health Care...

Please look at Figure 20.6 on page 530 of The Economics of Health and Health Care (8th edition) by Folland.   Subject: Take-up and crowd-out

Consider a population of 1,000 families: 200 had Medicaid insurance, 700 had someother type of insurance, and 100 were unisured. Suppose now that Medicaid increase eligibility rules that would allow an additional 100 families to get coverage. After one year, 250 families now have Medicais, 675 now have some other type of insurance, and 75 are uninsured.

a) Calculate the average take-up and crowd-out both in numbers of families and rates.

b) Calculate the marginal take-up rates occurring due to eligiblity change.

c) Has insurance coverage for the population increased? Why or why not?

d) Has insurance coverage for all families increased? Why or why not?

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