One true statement about a health plan's underwriting margin is that
A.
the only way that the health plan can effectively reduce its exposure to underwriting risk, and therefore adjust its underwriting margin, is to control anti selection
B.
a larger assumed underwriting margin will reduce the price of the health plan's product and will make the plan more competitive
C.
the health plan's purchase of stop-loss insurance has no effect on its underwriting margin because stop-loss insurance can help the health plan control its expenses but not its underwriting risk
D.
both the level of underwriting risk that the health plan assumes in providing benefits and the market competition it encounters most likely directly affect the size of its assumed underwriting margin
The Answer Is:
D
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