Jay Bhattacharya and M. Kate Bundorf of Stanford University have found evidence that people who are obese and work for firms that have employer-provided health insurance receive lower wages than people working at those firms who are not obese. At firms that do not provide health insurance, obese workers do not receive lower wages than workers who are not obese. Source: Jay Bhattacharya and M. Kate Bundorf, "The Incidence of the Health Care Costs of Obesity," Journal of HealthEconomics,Vol. 28, No. 3, May 2009, pp. 649-58.Firms that provide workers with health insurance may pay a lower wage to obese workers than to workers who are not obese because theformertend to beless healthyand consequently A.morecostly to insure and therefore employ due to theirhigherclaim submission rate. B.lessproductive at work. C.experiencehigherrates of absenteeism and early retirement. D.all of the above. E.A and B only.Regarding the question of whether health insurance provides people with an incentive to become obese, the finding of Bhattacharya and Bundorf seems A.irrelevant since a multitude of other factors besides the presence of health insurance can cause obesity. B."off the wall," because it's common knowledge that obesity is a disease, like cancer. C.irrelevant since correlation does not establish causation. D.relevant since the link between insurance and obesity was established while holding many other variables constant.

Obesity makes a person unhealthy and that person falls sick very frequently. Firms are usually…

Answered: Firms that provide workers with health…

EBK HEALTH ECONOMICS AND POLICY

7th Edition

ISBN:9781337668279

Author:Henderson

Publisher:Henderson

Chapter7: The Market For Health Insurance

Section: Chapter Questions

Problem 6QAP

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Jay Bhattacharya and M. Kate Bundorf of Stanford University have found evidence that people who are obese and work for firms that have employer-provided health insurance receive lower wages than people working at those firms who are not obese. At firms that do not provide health insurance, obese workers do not receive lower wages than workers who are not obese.

Source: Jay Bhattacharya and M. Kate Bundorf, "The Incidence of the Health Care Costs of Obesity," Journal of Health

Economics,

Vol. 28, No. 3, May 2009, pp. 649-58.

Firms that provide workers with health insurance may pay a lower wage to obese workers than to workers who are not obese because the

former

tend to be

less healthy

and consequently

costly to insure and therefore employ due to their

higher

claim submission rate.

less

productive at work.

experience

higher

rates of absenteeism and early retirement.

all of the above.

A and B only.

Regarding the question of whether health insurance provides people with an incentive to become obese, the finding of Bhattacharya and Bundorf seems

irrelevant since a multitude of other factors besides the presence of health insurance can cause obesity.

"off the wall," because it's common knowledge that obesity is a disease, like cancer.

irrelevant since correlation does not establish causation.

relevant since the link between insurance and obesity was established while holding many other variables constant.

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