1What is health care?
generally defined to encompass those goods and services whose primary purpose is to improve or prevent deterioration in health
2What is health?
a state of complete physical, mental, and social well-being and not merely the absence of disease or infirmity
3A good health system delivers...
quality services to all people when and where they need them
4What does a good health system require?
-robust financing mechanism
-well-trained and adequately paid workforce
-reliable information on which to base decisions and policies
-well-maintained facilities and logistics
5How is healthcare different?
-uncertainty
-Information of asymmetry
-presence of externalities
-demand for healthcare is a derived demand for health
-restrictions on competitionarriers to entry
-equity and need
-government interventions/subsidies and public provision
-non-profit firms
6T/F? Uncertainty in healthcare is common in both demand and supply side of the market.
true
7What is true of uncertainty in the demand side of health care?
people are uncertain about what type of health care is needed and when it is needed
8What is true of uncertainty in the supply side of health care?
difficult to predict the outcome of a treatment
9Uncertainty in health care markets leads to what?
presence of insurance
10When do information asymmetries between providers and patients occur?
when one party in the transaction has more information than the other party which may allow the better informed party to exploit the less informed party
11What are some examples of informational asymmetries between providers and patients?
-physician may know more about a diagnosis than the patient
-patient may know more about family health history than the insurer/physician
-Insurer may know more about cost of care than the patient/physician
12What can information asymmetry be exacerbated by?
-limited time to shop/seek information (e.g., when sick)
-occurs at times when individual is vulnerable or cognitively impaired
-Inability to learn from experience (2nd or 3rd care)
13When do externalities occur?
when someone external to the market transaction-that is someone who is neither the buyer nor the seller-is affected by the transaction and not compensated
14What are two types of externalities?
positive (beneficial effect) and negative (negative/harmful effect)
15What is an example of positive externality?
immunization-"herd immunity"
16What is an example of negative externality?
smoking, pollution
17Why is demand for healthcare a derived demand for good health?
-most of us would be happy never to (need to) consume health care
-unlike most consumer goods, we consume healthcare to benefit health in the long-term but itself in the short-term is often "bad" (vaccination, tooth filling, stitches)
18What are examples to restrictions on competitionarriers to entry into healthcare?
-patent protection in pharmaceutical industry
-licensure requirements for providers
-restrictions on product advertising
19Need for healthcare can be...but the resources are...
unlimited; limited
20In most countries, governments play a huge role in healthcare sector, either by...
provision of healthcare or by providing subsidies for the provision of healthcare
21What are examples of government interventions/subsidies and public provision in the US?
-medicare
-medicaid
-affordable care act
22Many health care providers such as hospitals function as...entities
non-profit
23The debate for if healthcare is a right or a privilege include...
-equity concerns--fairness and justice
-strong support globally for financing healthcare and its distribution
24Health care is considered...to other commodities due to the following characteristics...
different; health care is derived demand, externalities, uncertainty, informational asymmetries
25If everyone in the class gets a flu vaccination, except the professor who benefits from her students' choice, this is an example of...
positive externality
26You are sitting in an outside cafe having a cafe latte and a person on the next table starts smoking. The smoke bothers you and causes you to cough due to your asthma. This is an example of...
negative externality