Healthcare 1

Question 1

fact about us healthcare spending as a percentage of gdp

Answer 1

us spending on healthcare is higher per person and as a percentage of GDP but there is still 9.1% of people without medical insurance

Question 2

what is significant about us and doctor per 1000 heads

Answer 2

they have a higher spending per person on healthcare but still have lower number of doctors per head than Germany, France and UK

Question 3

what do i mean by distributional effects of hospital beds per 1000 people

Answer 3

it doesn’t take into account the distribution of beds so in some geographical areas (where less populated) it may be higher and in some places it may be lower

Question 4

what is life expectancy for healthcare

Answer 4

one way to measure outcome of healthcare

Question 5

how was everyone covered before obamacare *

Answer 5

elderly and disabled: medicare,
poor (poverty level or lower): medicaid,
workers and their families: employer-sponsored insurance (if full time and company large enough),
military: fully government run,
everyone else: individual market

Question 6

features of the system before obamacare *

Answer 6

50 million uninsured (16% population),
37% uninsured below poverty line,
medicaid eligibility varied with state,
insurance companies could charge different rates based on age gender medical history

Question 7

what is obamacare

Answer 7

affordable care act 2010

Question 8

before obamacare what could insurance companies do

Answer 8

charge different rates based on age, gender and medical history

Question 9

how were insurance markets before obamacare

Answer 9

insurance markets segmented with individuals only allowed an in-state insurer,
many states contained only one insurance provider

Question 10

who is medicaid for

Answer 10

poor (poverty level or lower)

Question 11

what is medicaid

Answer 11

publicly run health insurance program for low-income individuals

Question 12

features of medicaid before obamacare

Answer 12

privately provided care,
federal program but run by the states (shared costs but majority of funding from federal government),
states have some flexibility in setting eligibility criteria,
criteria include (another card)

Question 13

criteria for medicaid before obamacare

Answer 13

criteria include low-income, low assets as well as other categorical requirements (pregnant, disabled, etc)

Question 14

features of affordable care act (Obamacare) *

Answer 14

ACA passed in 2010 gradually implemented came into full effect in 2014,
extended coverage to all low-income individuals in participating states,
initially all individuals were required to obtain health insurance (mild penalty if not)

Question 15

what did the affordable care act (Obamacare) do to do with insurance companies *

Answer 15

insurance companies no longer able to price discriminate between high and low risk individuals directly,
insurance companies may provide different levels of insurance but must meet minimum standards

Question 16

tell me about the affordable care act (Obamacare) and trump

Answer 16

the original individual mandate was reversed by the Trump administration in December 2017

Question 17

what does healthcare do to people in the us

Answer 17

it ties people to jobs because they have medical insurance as part of package

Question 18

what is one problem with the system before obamacare in terms of companies

Answer 18

not all companies had to provide health insurance

Question 19

what are some of the market failures associated with medical care *

Answer 19

need is unpredictable (technically complex),
people are poorly informed,
there are many externalities,
unwilling to deny care to those without insurance (emergency rooms us),
barriers to entry (competition limited licensing regulation)

Question 20

explain market failure with healthcare people are poorly informed

Answer 20

can’t assess quality of care,
mistakes costly,
who is best doctor to treat cancer

Question 21

what does counterfactual mean

Answer 21

relating to or expressing what has not happened or is not the case (hard to know the counterfactual of medical care)

Question 22

explain market failure with healthcare there are many externalities

Answer 22

ebola,
vaccination,
human capital,
obesity

Question 23

explain market failure with healthcare barriers to entry

Answer 23

there are large setup costs of hospitals etc,
competition is limited because of this,
licensing and regulation,
doctors have to go to medical school and obtain qualifications

Question 24

what does adverse selection mean in the context of healthcare *

Answer 24

hidden attributes,

individuals know health history and health risks better than insurance companies

Question 25

what does moral hazard mean in the context of healthcare *

Answer 25

hidden action,
individuals are able to impact their own health, full insurance may allow riskier lifestyle (smoking, over-eating/drinking)

Question 26

what is the third-party payment problem (moral hazard) for healthcare

Answer 26

insurance company does not know quantity of health care needed to treat a particular illness, if patient fully insured doctor and patient face zero private cost so too much health care will be consumed

Question 27

where is the missing market for health insurance

Answer 27

many (healthier) people who would like to buy insurance will remain uninsured

Question 28

where is the asymmetric information for insurance markets

Answer 28

insurance companies cannot observe individuals levels of risk

Question 29

what is the uk system of healthcare

Answer 29

public financing (taxation) and production (public ownership)

Question 30

what is the moral hazard on the supply side in the us *

Answer 30

in the US doctors are paid for doing more stuff, especially more intensive,
however doctors fear being sued for malpractice

Question 31

what is the lefts view on obamacare

Answer 31

reform will cover people and has efficiency-improving changes,
if it doesn’t work we need a canadian style system

Question 32

what is the right view on obamacare

Answer 32

reform is weak on reducing health costs,
marginal tax rates created by reform are too big,
can’t afford the coverage increase now

Question 33

explain market failure for insurance market for healthcare without intervention to do with pooling equilibrium

Answer 33

since there is asymmetric information in that insurance companies can’t observe individual’s level of risk,
insurance company offers one price - healthy individuals don’t purchase insurance

Question 34

why is there not full insurance under ordinary moral hazard

Answer 34

with full insurance there is no incentive to take care, so such a contract will not be offered

Question 35

what is the individual mandate

Answer 35

requirement that nearly all Americans have health insurance (mild penalty if not)

Question 36

why would premiums rise if the individual mandate is reversed

Answer 36

healthier people exit the market, leaving behind a sicker, more expensive insurance pool

Question 37

assumptions for healthcare

Answer 37

insurance companies cannot differentiate between good and bad-health individuals,
health insurance mandatory,
insurance companies are not able to offer different types of insurance contracts that would cause individuals to self segregate