Question

Identify an appropriate Medicare rate that you would use when setting your in-office fees and describe the reason why you would choose that rate?

Answer 1

Medicare rate answer: 1.44%

Answer 2

Medicare fees are set according to a relative value scale rather than a free market, payments are made by third parties rather than consumers, and the labor market for physicians is illiquid, so the pricing mechanisms that regulate markets in other parts of the economy are not effective in rationalizing prices.