Explore BrainMass

Explore BrainMass

    Moral Hazard: Provider Payment Paradigm

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    Identify one moral hazard related to the provider payment paradigm. Propose a way to mitigate the hazard.

    © BrainMass Inc. brainmass.com June 4, 2020, 3:23 am ad1c9bdddf

    Solution Preview

    A moral hazard is one in which a person may have a tendency to take a risk because the costs of the risks will not be fully felt by the person involved. Since insurers are now involved in making healthcare decisions, you have the case of a third party (someone beside a physician or the patient) making medical decisions. This is particularly hazardous in that the insurer may be more willing to take a risk on reduction of services based upon statistics than a physician would who is entrusted with the ...

    Solution Summary

    This solution identifies moral hazards related to the provider payment paradigm and suggests a way to mitigate the hazard.