Question

True or False: Insurance does not reduce the cost of medical care but redistributes costs so that different people end of paying the costs for medical care.

True or false: Insurers usually take 15-20% of the premiums they receive for administration, marketing, and profit, with the bulk of the funds used to pay medical expenses.

Answer 1

True..

(Every dollar spent on the medical care is paid directly or indirectly by you or by someone. Insurer never pay for this for the most cases, we paid for this by either paying more taxes or taking low wages)..

True..

(In insurance there is 80/20 rule called as Medical Loss Ratio which says insurance companies has to spend at least 80% of the received premiums on health care claims and medical expenses while the remaining 20% for administration, marketing, and profit)..

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