In the United States, the bulk of health care spending is paid by health insurance companies. Such a system is also called a third-party payer system where consumers of health care pay a nominal fee and the rest are paid by the health insurance provider. Why might such a system lead to an inefficient outcome?

Question

Social Studies

Brittany Park

20 April, 12:51

In the United States, the bulk of health care spending is paid by health insurance companies. Such a system is also called a third-party payer system where consumers of health care pay a nominal fee and the rest are paid by the health insurance provider. Why might such a system lead to an inefficient outcome?

+2

Answers (1)

Know the Answer?

Camron Delacruz · Answer 1

The correct answer is because the over-consume

Explanation:

The over-consumption of the services provided by health insurance companies are athe main reason of the inefficency of the system because in the end the consumer is paying a price that is below the standards for these services provided because of the nominal fee so the unbalance in the system's market ends up affecting the whole system in a very negative way, leading to an inefficient outcome.