QUESTION 1: If a physician receives a bonus for referring a patient for cardiac surgery to a specialty hospital nearby his office:

The patient has violated the Stark law.
The physician has violated the Stark law.
The patient will probably receive better care than if he had gone to another hospital.
The patient's insurance company will always refuse to pay this bill.
The patient's insurance company will probably investigate for price discrimination.

QUESTION 2: Charging higher premiums to women of child-bearing age than to men of the same age is an example of price discrimination. True or false?

True ?False

QUESTION 3: Two events that were most effective in bringing about licensure of physicians were:

• Increases in the number of hospitals and development of effective anesthesia.
• Influx of foreign physicians and increase in medical school enrollees.
• Development of effective anesthesia and sepsis.
• Increases in demand for physicians and increases in the number of nurses.
• Increases in sepsis and increases in the number of physician assistants.

QUESTION 4: The variation in salary and total compensation for hospital administrators is much greater than that of hospital emergency room physicians. The president of a large teaching hospital may earn multiples of the salary of the president of a smaller community hospital. Physicians employed by hospital emergency rooms will have a much smaller variation in salary. One reason for this is:

• Physicians work more hours than administrators.
• Variability in skill levels between the best and worst in the field.
• Similarity in certification requirements.
• Similarity in licensure requirements.
• Variability in educational backgrounds.

QUESTION 5: One would expect that price elasticity will be greater for __________ than for ___________.

• medical school tuition; medical school entrance exam preparation tuition
• appendectomies; dental exams
• tonsillectomies; flu shots
• medical school entrance examination preparation course tuition; medical school tuition
• emergency room care; an annual mammogram

QUESTION 6: When assessing the market demand and supply of physicians, economists look at all of the following, except:

• Trends in the number of non-MD physicians, chiropractors, and physician substitutes.
• Trends in the retirement rates of physicians.
• Population growth.
• Academic publication records of practicing physicians.
• The number of students applying to medical schools.

QUESTION 7: In the short run, the supply curve for physicians is essentially downward sloping due to the licensure requirements. True or false?

True ?False

QUESTION 8: An HMO may monitor the diagnoses and treatments of participating physicians to determine how closely physicians follow observed norms of care or designated clinical pathways. This is a means for measuring:

• Quality
• Fraud
• Billing errors
• Accounting compliance
• Effficacy of treatments

QUESTION 9: Economies of scale means that a group physician practice is likely to return more income to physicians than would an individual practice. True or false?

True ?False

QUESTION 10: The federal government, through its control over the American Medical Association, held the physician supply constant for most of the 20th century. True or false?

True ?False