COMPREHENSIVE STUDY GUIDE 2026
FULL QUESTIONS AND SOLUTIONS
GRADED A+
◍ Which of the following characteristics is true of the pharmaceutical
industry?.
Answer: Exclusive rights to market & sell patented products.
◍ The tax fully dedicated to provide support for Medicare Part A is:.
Answer: A 2.9 percent payroll tax paid by all workers, regardless of their
age.
◍ Several reform options have been discussed by Congress to solve some of
the structural problems that plague the program. Which of the following
options has received little support?.
Answer: Limit the coverage for end-of-life care, the most expensive single
item in Medicare, to include only essential palliative care.
◍ Part B pays what percentage of the allowable fee set by Medicare?.
Answer: 80 percent.
◍ Which of the following statements is true concerning the trend in
community hospital care between inpatient & outpatient services since the
mid-1980s?.
Answer: Outpatient services have been growing, while inpatient services
have been declining.
◍ On average, biopharmaceutical companies spend approximately what
percentage of their sales revenue on research & development?.
Answer: 5-10 percent.
, ◍ In 2019, Medicare covered approximately how many Americans?.
Answer: 60 milllion.
◍ What was the main effect of the agreement on Trade-Related Aspects of
Intellectual Property Rights (TRIPS) on United States' domestic policy?.
Answer: It extended the life of patents from 17 years from the date of grant
to 20 years from the date of application.
◍ Suppose the market for nursing services in a local community is so
dominated by a single community hospital that, for all practical purposes, it
is considered a monopsony. Using the diagram below, answer the
question.If the market were perfectly competitive instead of dominated by a
monopsonist, what would the equilibrium wage & level of employment be?.
Answer: W1 & E1.
◍ In order to be a successful price discriminator, a provider must have a
degree of market power (depicted by a downward-sloping demand curve) &
meet what other condition(s)?.
Answer: Markets must be segmentable, identifying differences in ability to
pay.
◍ The merger of 2 community hospitals located in the same geographic market
is called:.
Answer: Horizontal integration.
◍ One of the primary reasons that costly technology is being introduced into
the health care system is:.
Answer: Third-party insurance finances most of the cost of care.
◍ Physicians who own their own diagnostic testing facilities tend to order
more tests, charge higher fees for them, & have higher total bills to patients.
This practice of self-referral is an example of:.
Answer: Physician-induced demand.
◍ Approximately what percentage of Medicare enrollees received inpatient
hospital care in 2018?.