During an in-service training, the speaker evaluates the attendees' knowledge of the term cost plus. Which response by the attendees indicates they understand?

Question

a. An international discount store
b. The amount of monies spent on health care plus the current inflation factor
c. The cost to the provider plus a profit incentive for being in business
d. The expenditure for being in the health care business plus benefits from pharmaceuticalcompanies

Answer 1

C
As health care expenditures continued to escalate upward, the concept of cost plus became the way to
determine the expenditure involved with service delivery. The actual cost (expenditure) the provider
incurred for care plus a profit incentive for being in business became known as "cost plus.". The
emphasis here was not on how services could be delivered economically, but "the more you spend, the
more you get.".