Question

What is the argument for risk adjustment in sickness funds (SF)?

a) To increase competition among insurers
b) To reward insurers for selecting low-risk clients
c) To reduce risk selection and ensure fair pricing
d) To decrease government control over the market

Answer 1

The argument for risk adjustment in sickness funds is to reduce risk selection and ensure fair pricing.

Step-by-step explanation:

The argument for risk adjustment in sickness funds (SF) is c) To reduce risk selection and ensure fair pricing. Risk adjustment is a method used to account for differences in the health status of individuals when determining insurance premiums. It helps to reduce the incentive for insurance companies to only attract low-risk clients and ensures that everyone pays a fair price based on their expected healthcare needs.