Question

Why does the use of for-profit health insurance increase the price of health care?

a. It encourages cost-saving measures
b. It leads to competition and lower prices
c. It requires high administrative costs and generates profits
d. It promotes government control over healthcare

Answer 1

For-profit health insurance increases the price of healthcare due to high administrative costs, profits, and a higher demand for healthcare services.

Step-by-step explanation:

The use of for-profit health insurance increases the price of healthcare because it requires high administrative costs and generates profits. Private healthcare insurance tends to encourage a higher demand for healthcare services, which leads to increased costs for insurance companies and society. Additionally, the focus on profits in for-profit health insurance may incentivize prioritizing long-term treatments over curing chronic illnesses, contributing to higher costs.