Sign Up Now
Get instant access to over 1 million+ study documents
OR
Already registered? click here to login
By creating your account, you agree to our terms of service, privacy policy and student honor code.
¶ … Health Care Economics
Heath care economics
The health care sector in the United States is faced with a series of challenges given by the dynamic and changing features of the modern day society. Two notable challenges in this sense are represented by moral hazard and demand inducement. These are best explained below:
"First, because of the nature of insurance at that time patients demanded all medical services regardless of cost, even those offering an insignificant health benefit (moral hazard). Second, autonomous providers of the traditional health economy received fee-for-service payments. This creates the incentive for physicians to recommend the extravagant of treatments, even if those treatments are inappropriate to the patients condition (demand inducement)" (University of Canterbury).
In order to address these issues, the concept and practice of managed care have been introduced. The scope of this application is that of creating more efficiency within the health care provision sector. And based on the progress made so far, it can be concluded that managed care has indeed had some positive impacts of moral hazard and demand inducement.
At the level of moral hazard, managed care has sought to eliminate the incentives of the physicians in recommending and providing excessive medical services to their patients. In the reduction of demand inducement, the managed care organizations have decided to pay their physicians fixed salaries, regardless...
Additionally, the challenge is represented by finding the adequate balance between the provision of medical services and the containment of the costs.
(2)
In an effort to reduce their costs with health care, namely with the medicine they have to take, the American citizens sometimes travel to Mexico or Canada and have their prescriptions filled in these countries. The process is normally completed by individuals for their personal use and it is referred to as re-importation of drugs.
These drugs had initially been produced within the United States, but they are sold at lower prices in Mexico and Canada. From the legal standpoint, the re-importation of drugs is illegal and the primary concerns of the FDA (Food and Drug Administration) refer to the safety of the drugs, in the meaning that the U.S. does not have the power to control the distribution systems in Canada and Mexico. Still, the FDA does not promote a policy of complete prohibition since it considers re-importation the lesser evil than people going sick because they do not afford the medicine they need (AARP).
The development and implementation of a policy regarding the re-importation of American drugs from Mexico and Canada would most likely be an ineffective measure and this is…
References:
Morton, F.M.S. The problems of price controls. Health and Medicine. http://www.cato.org/pubs/regulation/regv24n1/morton.pdf accessed on October 5, 2012
Health economics II. Overcoming inefficiency through managed care. A look at David Drannove's rationale. University of Canterbury. http://www.econ.canterbury.ac.nz/personal_pages/john_fountain/Teaching/HealthEcon/econ338/workshop/Sam%20on%20Dranove.htm accessed on October 5, 2012
Prescription drug re-importation question and answer sheet. AARP. http://assets.aarp.org/www.aarp.org_/articles/international/ReimportationQA.pdfaccessed on October 5, 2012
Healthcare System in South Africa Healthcare policy Influences on public health outcomes Critical analysis of the pressures on the health care delivery It is observed that there are numerous cultures, societies, political systems in the world. The governments regulate the social systems according to the political, cultural, and economic condition of a country. The structure of healthcare systems is also an extension of the country's political system. It is observed that the characteristics of
Health Care Disparities Race Related Healthcare disparities Serial number Socioeconomic status and health Correlation between socioeconomic status and race Health insurance and health Who are the uninsured people? Causes of health care disparities Suggestions for better health care system The latest studies have shown that in spite of the steady developments in the overall health of the United States, racial and ethnic minorities still experience an inferior quality of health services and are less likely to receive routine medical
Healthcare spending and GDP With the renewed comprehensive healthcare system, the obvious challenge that came with it is how to finance it. The huge projections of the financial inputs needed to efficiently run the program portends a challenge to the government and is likely to spin out of control and be unaffordable in the long run after a few decades from now. This is informed by accompanying supplies and services increasing
Transparency empowers consumers to become better shoppers. Economists assert that transparency stimulates productivity, for example, in exchange for money, one individual obtaining fair value. In every aspect, except healthcare, Davis points out, transparency, is supported. The contemporary dearth of transparency in healthcare has led to many Americans not being able to effectively shop for the best quality of service at acute care hospitals. Davis argues that transparency permits consumers,
Healthcare in the United States: Where We Have Been, Where We Are Going The current healthcare crisis in America is not one that happened over night. It is one that has been building for more than a quarter century. There was a time in America when healthcare was a stellar institution: research, cures, technological advances, and treatments. The focus of healthcare was maintaining and improving the quality of life. Then, during
Rarity: Health Care REIT is one of many luxury and acute care investment properties on the market. Imatability: Given the lack of available credit for starting new property ventures and construction, the company's current facilities do give it an advantage. Financial barriers to industry entry are higher than they were in the past. This can act as a barrier to 'imatiblity' of its business model. Organization: Health Care REIT has a fairly