A Client Has a Private Insurance Policy That Pays for Most

question 31

Multiple Choice

A client has a private insurance policy that pays for most health care costs and services. Why is this plan called a third-party payer?

• A) The insurance company pays all or most of the costs.
• B) The family of the client is required to pay costs.
• C) The client gets the bill and pays out-of-pocket costs.
• D) Medicare and Medicaid will pay most of the costs.

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Definitions:

Hard Capital Rationing

Hard capital rationing involves a situation where a company cannot access additional funds for investments at any cost due to external factors, such as market conditions or regulatory limits.

Discounted Payback

A capital budgeting method that calculates the time it takes to recoup an investment's initial costs, taking the time value of money into account.

Time Value of Money

The concept that money available at the present time is worth more than the same amount in the future due to its earning capacity.

Project's Liquidity

The ease with which a project's assets can be converted into cash without significant loss of value.