Office Administrative Assistant Practice Exam

Which of these is the payor of last resort?

1. Medicaid

2. Medicare

3. Private Insurance

4. Self-Pay

The correct answer is: Medicaid

Medicaid is known as the payor of last resort because it is designed to provide coverage for individuals who have exhausted other sources of insurance or financial assistance. This means that Medicaid only pays for healthcare services after all other payment options, such as Medicare, private insurance, or self-pay, have been considered and applied. The rationale behind this is to ensure that taxpayer resources are used effectively, supporting those who do not have any other means to cover their healthcare expenses. In this context, Medicare, private insurance, and self-pay are considered other funding options that are utilized first before Medicaid steps in to cover any remaining costs. This establishes Medicaid’s role as the safety net for healthcare funding, particularly for low-income individuals and families who might not qualify for other forms of insurance.