Question

What has a larger effect on reducing moral hazard, a deductible or coinsurance?

What has a larger effect on reducing moral hazard, a deductible or coinsurance?

Homework Answers

Answer #1

Deductible is a method in which a large portion of the bills are paid by the insurance after deducting the obligatory payment.

Coinsurance refers to a percentage of the bill paid by your insurance plan and a smaller perfectage of it being paid by you.

Deductible has a larger effect on reducing moral hazard as when it comes to a larger bill, there is a fixed amount that you have to pay rest covered by the insurance. And it also resets yearly. Therefore this has a larger effect when compared to coinsurance.

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Which of the following types of deductibles is most effective at mitigating moral hazard? Straight deductible...
Which of the following types of deductibles is most effective at mitigating moral hazard? Straight deductible Aggregate deductible Franchise deductible They are all equally effective
The deductible feature of an insurance policy can affect the impact of moral hazard. Explain this...
The deductible feature of an insurance policy can affect the impact of moral hazard. Explain this context either of probability of treatment and/or amount of treatment demanded
What is moral hazard? Identify 2 regulations in the Frank-Dodd Act that affects moral hazard behavior...
What is moral hazard? Identify 2 regulations in the Frank-Dodd Act that affects moral hazard behavior of banks. Explain how each one increases or decreases the moral hazard problem. Be specific. Vague answers get less points.
larry has a health insurance policy that includes a deductible of $1,000 and a coinsurance of...
larry has a health insurance policy that includes a deductible of $1,000 and a coinsurance of 20%. If his total bill is $7,000, how much will his insurance pay?
Peter has a health insurance policy that includes a deductible of $1,500, a coinsurance of 20%,...
Peter has a health insurance policy that includes a deductible of $1,500, a coinsurance of 20%, and a stop-loss of $5,000. If his total bill is $20,000, how much will he pay? Show all calculations and explain your answer.
1. Suppose Steve has an insurance policy with a $1,000 deductible, 20% coinsurance, and a $7,500...
1. Suppose Steve has an insurance policy with a $1,000 deductible, 20% coinsurance, and a $7,500 out-of-pocket maximum. A) How much is Steve responsible for a hospital bill of $2,000? B) Now suppose he has another bill for $25,000 because of a surgery in the same year. How much is he responsible for this second bill?
Name 2 examples of moral hazard that has been found by researchers with the Unemployment Insurance...
Name 2 examples of moral hazard that has been found by researchers with the Unemployment Insurance social insurance program.
Discuss Health Care and Moral Hazard and what can be done to improve waiting times in...
Discuss Health Care and Moral Hazard and what can be done to improve waiting times in the public health sector express this in a graph
What is moral hazard? Do you think it is reasonable to utilize co-payments and deductibles to...
What is moral hazard? Do you think it is reasonable to utilize co-payments and deductibles to deter over-utilization of healthcare? Please explain why/why not.
Joy’s health insurance includes a 20-80 coinsurance provision, after a $250 deductible is satisfied. Joy needed...
Joy’s health insurance includes a 20-80 coinsurance provision, after a $250 deductible is satisfied. Joy needed medical attention and the covered medical expenses totaled $25,250. How will this claim be settled? What if there is also a stop-loss limit of $5,000?