Explain why patients in hospitals are generally insensitive to price, but buyers of health insurance are sensitive to price differences in health insurance policies.

Explain why patients in hospitals are generally insensitive to price, but buyers of health insurance are sensitive to price differences in health insurance policies.

SECTION II. SHORT ANSWERS (10 points each) Place your cursor after the arrows → and type the requested information or your answer. Expect that the text will move to accommodate the length of your answer.
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4. Explain why patients in hospitals are generally insensitive to price, but buyers of health insurance are sensitive to price differences in health insurance policies. Be sure to include an explanation of why insurance companies are very price competitive.

5. The number of large US employers offering wellness programs to their employees has been steadily increasing over the years. Weight management, nutrition, fitness, and/or other wellness initiatives are now being offered by more than half of such employers. Use the concept of determinants of health to discuss the reasoning behind this trend. What do the employers expect to gain from this additional expense? Compare short-run versus long-run gains, private versus societal gains.

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