One of the Major Employer Advantages in Contracting with Health

question 59

Multiple Choice

One of the major employer advantages in contracting with health maintenance organizations (HMO's) to deliver employee health care is:

• A)employees have greater choice in selecting a physician.
• B)the employer receives copies of all employee medical records.
• C)premiums remain stable for a five-year period.
• D)reduced costs.

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Definitions:

Product Costs

The total costs directly involved in manufacturing a product, including material, labor, and overhead expenses.

Period Costs

Expenses that are not directly tied to the production process and are typically accounted for as expenses in the period they are incurred.

Contribution Margin

The amount by which sales revenue exceeds variable costs, contributing to the coverage of fixed costs and profit generation.

Direct Manufacturing Cost

The total cost directly involved in the manufacturing of a product, including direct materials and direct labor but excluding overhead.