One Reason Why Adverse Selection Problems Arise in Health Insurance

question 63

Multiple Choice

One reason why adverse selection problems arise in health insurance markets is that

• A)sick people are more likely to want health insurance than healthy people.
• B)because of advances in medical technology, people are living longer. These medical advances are costly and drive up the price of insurance for everyone.
• C)the average age of citizens of the United States has increased in recent years, and will continue to increase over the next 20 to 30 years. As older citizens retire, more and more of their medical bills will have to be paid by younger workers.
• D)fewer men and women are choosing medical careers because of the increase in the cost of malpractice insurance.

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Definitions:

Social Connections

The relationships and bonds between individuals that provide support, facilitate communication, and contribute to social cohesion.

Loneliness

The subjective feeling of lacking desired social connection, interaction, and intimacy.

Psychological Need

A mechanism for regulating behavior to acquire the tangible or intangible resources necessary forsurvival and well-being.

Self-regulation

The process by which individuals control or adjust their emotions, thoughts, and behaviors in accordance with their goals.