D223 NURS 2650
Healthcare Policy & Economics
Final Assessment Prep
(With Solutions)
2025
1
,Multiple Choice
Which of the following best describes the primary goal of cost-
effectiveness analysis (CEA) in healthcare?
A) To maximize patient satisfaction regardless of cost
B) To compare the relative costs and outcomes of different interventions
C) To allocate unlimited resources efficiently
D) To evaluate only the clinical outcomes of treatment
Answer: B
Rationale: CEA compares costs and health outcomes to inform decision-
making on resource allocation.
Medicare Part D primarily covers which type of healthcare service?
A) Hospital inpatient care
B) Outpatient physician services
C) Prescription drugs
D) Long-term care
Answer: C
Rationale: Medicare Part D provides prescription drug coverage for
eligible seniors.
Which payment model incentivizes providers to reduce unnecessary
services while improving quality?
A) Fee-for-service
B) Capitation
C) Pay-for-performance
D) Global budgeting
Answer: C
Rationale: Pay-for-performance rewards providers for meeting quality
and efficiency benchmarks.
The concept of "moral hazard" in health insurance refers to:
A) Patients avoiding care due to cost
B) Insurers refusing to cover pre-existing conditions
C) Increased utilization when individuals are insulated from the cost
2
, D) Providers charging excessively for services
Answer: C
Rationale: Moral hazard occurs when having insurance leads to higher
consumption of healthcare than necessary.
Which of the following is a key principle of the Affordable Care Act
(ACA)?
A) Mandatory medical savings accounts
B) Expansion of Medicaid eligibility
C) Elimination of all private insurance
D) Single-payer health system
Answer: B
Rationale: The ACA expanded Medicaid to cover more low-income
individuals.
True/False
True or False: Capitation payment models pay providers a fixed amount
per patient regardless of how many services are provided.
Answer: True
Rationale: Capitation involves fixed payments per patient to encourage
cost control.
True or False: Value-based care focuses primarily on reducing costs
without regard to quality.
Answer: False
Rationale: Value-based care aims to improve outcomes while controlling
costs.
True or False: Health Maintenance Organizations (HMOs) typically have
more restricted provider networks than Preferred Provider Organizations
(PPOs).
Answer: True
Rationale: HMOs generally require members to use in-network providers
for coverage.
3
Healthcare Policy & Economics
Final Assessment Prep
(With Solutions)
2025
1
,Multiple Choice
Which of the following best describes the primary goal of cost-
effectiveness analysis (CEA) in healthcare?
A) To maximize patient satisfaction regardless of cost
B) To compare the relative costs and outcomes of different interventions
C) To allocate unlimited resources efficiently
D) To evaluate only the clinical outcomes of treatment
Answer: B
Rationale: CEA compares costs and health outcomes to inform decision-
making on resource allocation.
Medicare Part D primarily covers which type of healthcare service?
A) Hospital inpatient care
B) Outpatient physician services
C) Prescription drugs
D) Long-term care
Answer: C
Rationale: Medicare Part D provides prescription drug coverage for
eligible seniors.
Which payment model incentivizes providers to reduce unnecessary
services while improving quality?
A) Fee-for-service
B) Capitation
C) Pay-for-performance
D) Global budgeting
Answer: C
Rationale: Pay-for-performance rewards providers for meeting quality
and efficiency benchmarks.
The concept of "moral hazard" in health insurance refers to:
A) Patients avoiding care due to cost
B) Insurers refusing to cover pre-existing conditions
C) Increased utilization when individuals are insulated from the cost
2
, D) Providers charging excessively for services
Answer: C
Rationale: Moral hazard occurs when having insurance leads to higher
consumption of healthcare than necessary.
Which of the following is a key principle of the Affordable Care Act
(ACA)?
A) Mandatory medical savings accounts
B) Expansion of Medicaid eligibility
C) Elimination of all private insurance
D) Single-payer health system
Answer: B
Rationale: The ACA expanded Medicaid to cover more low-income
individuals.
True/False
True or False: Capitation payment models pay providers a fixed amount
per patient regardless of how many services are provided.
Answer: True
Rationale: Capitation involves fixed payments per patient to encourage
cost control.
True or False: Value-based care focuses primarily on reducing costs
without regard to quality.
Answer: False
Rationale: Value-based care aims to improve outcomes while controlling
costs.
True or False: Health Maintenance Organizations (HMOs) typically have
more restricted provider networks than Preferred Provider Organizations
(PPOs).
Answer: True
Rationale: HMOs generally require members to use in-network providers
for coverage.
3
