Health Expenditure Flashcards
What are the conditions for the market to work? slide2
The market allocates goods / services efficiently under these conditions:
- No barriers to entry or exit
- Who pays gets the goods / services
- Perfect information
How does the market work? slide2
more demand leads to increase of price
less demand leads to reduction of price
What is equlibrium? slide2
All the people who want to sell, can sell
How do these conditions work with the health care market? Name 5 points: slide3
- uncertainty
- imperfect information
- monopoly / oligopoly on setting the price.
Health care market –> uncertainity
can’t forecast the health status
Health care market –> imperfect information
lack of info on costs, effectiveness and benefits.
Not physically able to make choices - your child is sick. agency relationship. potential induced demand
Health care market –> monopoly / oligopoly
few producers agree on the price
Health care market –> equity
the market is good to allocate efficiently goods / services, but fairness is not taken into account. free market means fairness in different outcome
Health care market –> externalities
when costs of producing and benefits of consuming spill over other people: negative - virus, positive - vaccine
Determinants of population health. Name 5
slide5
- genes & biology
- health behaviours
- medical care
- total ecology
- social / societal characteristics
How are health care systems financed? slide6
The idea is to have 3rd party pay for care out of a central fund, either by premium or taxation
There are two concepts behind the insurance market:
1. Adverse selection
individuals with poor health are more likely to get a health insurance:
- experience ratings (sick and poor pay more)
- exclusions and benefit ceilings
- cover those in need
- publicly financed health care systems
- Moral hazard
once insured, people care less:
- copayment methods or user charges
- combine users with providers: (only that doc)
- use primary care: (gate keeping)
- waiting lists
- incentives: (low costs providers only)
There should be space for public intervention by using the following three:
- public provision / social insurance coverage
- subsidising or regulation private insurance
- selective subsidies or provision of services.
Health care financing in the world is via:
- general revenue
- social health insurance
- private health insurance
- community financing
- out of pocket financing
- external aid
:-)
General revenue
strongly correlated with high income
high degree of political intervention (corruption)
depends on the economic situation of the country
NHS covers entire population
Social health insurance
- involves contribution linked to a package of benefits
- risks are pooled across individuals
- compulsory and attached to one’s wage
- covers only eligible persons
- government might support the system subsidising some treatments or illness
Private health insurance
- buyer buys from private provider
- high risk and more costly are typically excluded
- reflects the buyers risk rather than their ability to pay
Community financing
- locally managed
- cover people that might be excluded
Out of pocket financing
- payment straight to the provider
- main source of financing in low income countries
- most in need are the most vulnerable
External aid
nope :-)
What are the three main characteristics on how to evaluate which system is the best one?
- risk pooling
- equity
- economic effects
Statement: In efficiency there is no fairness in the market, it only cares about resources
Statement: measuring health outcome is very complicated
Problems of today:
- big population but low fertility rate
- financing by taxes: crisis? no money from the gov.
- getting older, but healthcare more expensive
