The State of Massachusetts Requires All Citizens to Purchase Medical

question 384

Multiple Choice

The state of Massachusetts requires all citizens to purchase medical insurance or face a monetary penalty when filing their taxes. The penalty is significantly less than the average annual insurance premium. Moreover, the state requires insurance companies to issue policies to anyone who applies, regardless of their health at the time of application. Which of the following examples describes the inherent adverse selection problem?

• A)Tricia purchases an insurance policy through her employer and visits her doctor for annual check-ups.
• B)Sue purchases insurance only after learning that she has cancer.
• C)Mike pays the penalty rather than purchasing insurance because it is cheaper for him than paying insurance premiums and he is generally in good health.
• D)Both b and c are correct.

---

Definitions:

Anorexia Nervosa

A psychiatric disorder characterized by an intense fear of gaining weight and a distorted body image, leading to self-starvation and excessive weight loss.

Amenorrhea

The absence of menstruation in women of reproductive age, which can be a symptom of health issues or physical exertion and stress.

DSM-5

The 5th edition of the Diagnostic and Statistical Manual of Mental Disorders, a standardized classification and diagnostic tool used by mental health professionals.

Binge/Purge Type

A subtype of certain eating disorders, where individuals engage in recurrent episodes of binge eating followed by purging to prevent weight gain.