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Private health plans have three general tools they can use to reduce inefficient over-utilization among their policyholders: demand-side cost sharing supply-side cost sharing managerial controls

Private health plans have threegeneraltools they can use to reduce inefficient over-utilization among their policyholders:

  • demand-side cost sharing
  • supply-side cost sharing
  • managerial controls (a.k.a. utilization review)

a)Discuss how health plans deploy each of these tools, and explain how they can reduce utilization.

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