Lecture 1 Flashcards
Why do we need health insurance?
to protect against large financial losses, reduce barrier to seeking care, increase the predictability of costs and utilization through pooling
What happens to people who don’t have insurance?
They’re much more likely to forego basic medical services
Which services are uninsured adults most likely to forego?
preventative medicine, doctor/health care professionals
What are uninsured people less likely to receive preventative care and services for?
Major health conditions and chronic diseases
What does more generous health insurance lead to?
People using some services more
What does it mean to discount the future?
Deal with what’s today and ignoring what tomorrow might bring, favoring the present over the future
What do we often discount the future when it come to health care?
Preventative services
Why is health care utilization lumpy bumpy (skewed)?
Healthy young people use very few services and a few people will use a lot of services
What is cross subsidization?
Those people don’t use a lot subsidize those people who do
Where and when did health insurance in the US start?
1929 at Baylor University Hospital in Texas, where they set up a pre payment plan with a group of Dallas teachers
Why 1929 (Baylor University Hospital stating health insurance)?
The Great Depression; high unemployment rate (people can’t afford to go to the doctor)
Why Dallas teachers?
One job people weren’t going to lose because education is needed (teachers are employed) and most of them are women (women give birth; pregnancy is expensive); Teachers have reason to use healthcare
What is Blue Cross?
Hospital based and community based pre-payment plans organized into this
Why did expansion of Blue Cross happen?
Most states passed laws exempting hospital service plans from reserve requirements
What’s a reserve requirement?
Minimum amount of cash or securities that an insurance company must have on hand to pay claims
Why no reserve requirements (Blue Cross)?
Because the hospitals providing the service
Why didn’t the doctors like the arrangement of Blue Cross?
They were worried about someone stepping in between the doctor and the patient (insurance = control); didn’t want to be told what to do
Why was Blue Shield created and when?
1939; Worried that the hospitals would take their money pay them and make them employees, weren’t making enough money because of the depression
What was happening in 1939?
The Great Depression is still happening
When did the Great Depression end?
1941 (Word War 2)
What happened December of 1941?
Pearl Harbor
What is Blue Shield?
A physicians service that provided service benefits for home and office visits (as well as doctor services in the hospital); had to be doctor-controlled
Why was being it non-profit a requirement for Blue Shield?
So a for profit insurance company couldn’t take their money and make money off them
Why no reserve requirements (Blue Shield)?
same reason as Blue Cross
