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tardy payments

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by maihuna » Sun Jan 04, 2009 11:37 am
Experts estimate that insurance companies' tardiness in paying doctors for legitimate medical claims adds approximately 10 percent in overhead costs for physicians. Insurance companies counter that the tardiness sometimes results from billing errors made by the doctors themselves. Since dealing with these billing errors costs the insurance companies time and money, it is clear that insurance companies do not have a significant economic incentive to delay claim payments to doctors.

Which of the following pieces of information, if true, weakens the conclusion above?
Some doctors who submit accurate bills to insurance companies still receive tardy payments.
The cost to the insurance companies to process incorrect bills from doctors' offices is roughly equivalent to the increased costs that physicians accrue as a result of tardy payments from insurance companies.
A rising proportion of medical claims submitted by doctors to insurance companies are deemed illegitimate by those insurance companies.
The billing errors made by doctors' offices are typically very minor, such as the submission of a claim with an outdated patient home address.
The overhead costs incurred by doctors as a result of delayed insurance payments result in an increase in the premiums paid by consumers to health insurance companies that far exceeds any increase in the fees paid to doctors by insurance companies.
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Source: — Critical Reasoning |

by chetanojha » Sun Jan 04, 2009 1:03 pm
A seems to be the candidate answer here as it counters the Insurance companies argument that the tardiness sometimes results from billing errors made by the doctors themselves
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by maihuna » Sun Jan 04, 2009 1:38 pm
A is an incorrect option.
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by nitintahiliani » Sun Jan 04, 2009 2:20 pm
[spoiler]IMO E .[/spoiler] As that option states the "economic incentive " for insurance company. Hence they have reason to delay the payments to doctors.
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by pandeyvineet24 » Sun Jan 04, 2009 5:56 pm
C for me.

Insurance companies decide whether the claims submitted are illegitimate.
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by ronniecoleman » Sun Jan 04, 2009 9:42 pm
Experts estimate that insurance companies' tardiness in paying doctors for legitimate medical claims adds approximately 10 percent in overhead costs for physicians. Insurance companies counter that the tardiness sometimes results from billing errors made by the doctors themselves. Since dealing with these billing errors costs the insurance companies time and money, it is clear that insurance companies do not have a significant economic incentive to delay claim payments to doctors.


conclusion: insurance companies do not have a significant economic incentive to delay claim payments to doctors.


Which of the following pieces of information, if true, weakens the conclusion above?



The billing errors made by doctors' offices are typically very minor, such as the submission of a claim with an outdated patient home address.
The overhead costs incurred by doctors as a result of delayed insurance payments result in an increase in the premiums paid by consumers to health insurance companies that far exceeds any increase in the fees paid to doctors by insurance companies


Choose E

that is the only option that suggest that there is a economic gain for insurance companies in delaying the payments.
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by cramya » Sun Jan 04, 2009 10:04 pm
CONCLUSION:

it is clear that insurance companies do not have a significant economic incentive to delay claim payments to doctors

The one option that will clearly show that a different motive(a form of economic incentive ) exists for the insurance companies then that would weaken the argument.

Choice E does that by saying that they get more revenue from the consumers through premiums when a delay occurs.

Just my 2 cents:

Practice the basics(applies to all of us) -> Identify the premises (paraphrased assumptions in our mind when reading-> In this case the assumption would be no motive exists for the insurance companies to delay payments since it costs them time and money) and conclusion of an argument is the key to doing well in CR.

If we dont do this then we would end up choosing a wrong answer choice that focusses on something other than the conclusion.The test makers do this on almost every single question IMO (On conclusion questions by giving an answer choice that will relate to a premise etc...)

Experience has been my best teacher when making this statement...

If E is not right then I need to work even harder on this part... :D
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by maihuna » Thu Jan 08, 2009 1:40 pm
Hi Cremya,

You are doing an Weaken the conclusion right?

You clearly found E does that.

E is indeed the OA. If you still coudn't reconnect please let me know.
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by pbanavara » Fri Jan 09, 2009 6:31 pm
cramya wrote:CONCLUSION:

it is clear that insurance companies do not have a significant economic incentive to delay claim payments to doctors

The one option that will clearly show that a different motive(a form of economic incentive ) exists for the insurance companies then that would weaken the argument.

Choice E does that by saying that they get more revenue from the consumers through premiums when a delay occurs.

Just my 2 cents:

Practice the basics(applies to all of us) -> Identify the premises (paraphrased assumptions in our mind when reading-> In this case the assumption would be no motive exists for the insurance companies to delay payments since it costs them time and money) and conclusion of an argument is the key to doing well in CR.

If we dont do this then we would end up choosing a wrong answer choice that focusses on something other than the conclusion.The test makers do this on almost every single question IMO (On conclusion questions by giving an answer choice that will relate to a premise etc...)

Experience has been my best teacher when making this statement...

If E is not right then I need to work even harder on this part... :D
Imagine that - if you have to work harder - I would have to probably give up on GMAT :)
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by Bidisha800 » Fri Jan 09, 2009 7:30 pm
To weaken the argument we need to show that the insurance companies indeed have some incentive in delaying the payments. Only (E) clearly indicates in that direction.
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by logitech » Fri Jan 09, 2009 7:55 pm
cramya wrote:CONCLUSION:

it is clear that insurance companies do not have a significant economic incentive to delay claim payments to doctors

The one option that will clearly show that a different motive(a form of economic incentive ) exists for the insurance companies then that would weaken the argument.

Choice E does that by saying that they get more revenue from the consumers through premiums when a delay occurs.

Just my 2 cents:

Practice the basics(applies to all of us) -> Identify the premises (paraphrased assumptions in our mind when reading-> In this case the assumption would be no motive exists for the insurance companies to delay payments since it costs them time and money) and conclusion of an argument is the key to doing well in CR.

If we dont do this then we would end up choosing a wrong answer choice that focusses on something other than the conclusion.The test makers do this on almost every single question IMO (On conclusion questions by giving an answer choice that will relate to a premise etc...)

Experience has been my best teacher when making this statement...

If E is not right then I need to work even harder on this part... :D
Good point Cramya. You nailed this question.
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by Brad.C » Fri May 13, 2016 1:53 pm
I would go with option E as the correct option
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