Suppose a Large Firm Allows Its Employees to Choose Whether

question 147

Multiple Choice

Suppose a large firm allows its employees to choose whether to participate in its health insurance plan.The firm is trying to decide between two plans: Plan I has a low monthly premium but a high deductible, and Plan II has a high monthly premium but a low deductible.Under which plan is adverse selection likely to be a bigger problem?

• A)Plan I because it is likely to draw participants who expect high medical costs. This group expects to consume much health care services and therefore prefer low deductibles.
• B)Plan II because it is likely to draw participants who expect high medical costs. Healthy individuals who do not expect to consume much health care services will not be willing to pay the high premiums.
• C)Plan I because it is likely to draw the relatively healthy employees who do not expect to spend much on health care. Because the monthly premiums are low, the insurance company has to bear a bigger financial burden in the event of serious illnesses.
• D)Plan II because it is likely to draw employees who tend to over-consume health care services because of the low deductible. Insurance companies are likely to end up paying out more claims than the premiums they collect.

Differentiate between various psychotherapeutic approaches based on their foundational theories.

Apprehend the role of cognitive restructuring in treating psychological disorders.

Learn about the effectiveness of contingency management in treating substance abuse and other behavioral issues.

Understand the concept of temporary insurance coverage through binders.

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Definitions:

Emigrants

Individuals who leave their country of origin to live permanently in another country, often in search of better living conditions, job opportunities, or to join family.

Refugees

Individuals who are forced to leave their country in order to escape war, persecution, or natural disaster.

Blessing From God

A favor or gift bestowed by God, resulting in happiness, wellbeing, or a condition of being protected or sanctified.

Recovering From Illness

The process of regaining health and strength after being sick, involving treatment, rest, and sometimes rehabilitation.