Principles in Health Economics and Policy

by Olsen, Jan Abel

• ISBN13: 9780199237814
• ISBN10: 0199237816
• Edition: 2nd
• Format: Paperback
• Copyright: 2009-10-11
• Publisher: Oxford University Press

Summary

Examining the different structures and techniques involved in making decisions about who benefits from those health care resources available in a publicly funded system, this book is a concise and compact introduction to health economics and policy. It introduces the subject of economics, explains the fundamental failures in the market for health care and discusses the concepts of equity and fairness when applied to health and health care. Written for students and health professionals with no background in economics, this new edition has been fully updated and revised. It now provides a more policy-oriented appraoch than before, emphasizing the application of economic analysis to health policy issues. User-friendly and filled with non-specialist language and easily understandable mathematics, this volume addresses a range of universal health policy issues through the application of health economic analyses. Exploring key questions currently facing health policy makers across the globe, it asks: how should society intervene in the determinants that affect health?; how should health care be financed?; how should health care providers be paind?; and how should alternative health care programs be evaluated when setting priorities? With exercises and suggested further reading lists at the end of each chapter, Principles in Health Economics and Policy, 2nd edition, is an ideal resource for students and health professionals. It is the perfect place to find a clear and concise policy relevant introduction to the application of health economics to health care funding from a unique economics perspective that cannot be found anywhere else.

Table of Contents

The context of health and health care
Health and health care	p. 3
What is health?	p. 3
What is health care?	p. 6
What do health care and health do for people?	p. 8
Health and health care across the world	p. 11
Conclusion	p. 14
Economics and efficiency	p. 17
More in means more out-but at a diminishing rate	p. 19
Substitution: æmore than one way to skin a catÆ	p. 24
Scarcity: a dismal reality for the dismal science	p. 32
Supply and demand-and the magic equilibrium	p. 38
Conclusion	p. 44
What makes the market for health care different?	p. 47
The perfect market model and the imperfect market for health care	p. 47
Asymmetric information and the agency relationship	p. 52
Externalities: selfishly motivated	p. 55
Conclusion	p. 59
Equality and fairness	p. 61
Externalities: unselfishly motivated	p. 61
Transfers in cash or in kind	p. 64
Three theories of distributive justice	p. 67
The health frontier and trade-offs	p. 72
Conclusion and some conceptual clarifications	p. 77
Intervening in the determinants of health
The health environment	p. 85
The physical environment	p. 85
The social environment	p. 89
Conclusion	p. 92
Health-related lifestyle	p. 95
Diet	p. 96
Exercise	p. 98
Substance use	p. 98
Conclusion	p. 101
Financing health care
Uncertainty and health insurance	p. 107
The welfare gain from insurance	p. 108
Moral hazard	p. 112
Risks differ: actuarially fair insurance	p. 113
Adverse selection	p. 114
Conclusion	p. 116
Compulsory insurance	p. 119
Social health insurance	p. 120
Tax-financed health care	p. 121
Comparing three insurance systems	p. 123
Conclusion	p. 123
Patient payment	p. 127
The third party or the patient pays	p. 128
Co-payment, co-insurance, co-funding, cost sharing	p. 128
Deductibles	p. 129
Distributive implications	p. 131
Negative patient payments	p. 132
Autonomous consumer or compliant patient	p. 133
Conclusion	p. 134
Paying health care providers
Primary care	p. 139
Fee for service	p. 140
Capitation	p. 143
Salary	p. 145
Comparing three payment systems	p. 148
Conclusion	p. 151
Secondary care: reimbursing hospitals	p. 153
Retrospective variable: cost reimbursement	p. 154
Prospective fixed budgets	p. 155
Prospective variable	p. 155
Macro vs micro level	p. 157
Conclusion	p. 157
Integrating the health care provider system	p. 161
Combinations of payment systems in primary and secondary care	p. 161
TheæbodyÆof the health care provider system	p. 163
Interventions: integration and incentives	p. 165
Conclusion	p. 167
Economic evaluation and priority setting
Non-monetary effects and monetary benefits	p. 175
Incommensurable outcome measures	p. 176
Commensurable measures of health effects	p. 178
Production gains resulting from improved health	p. 185
The monetary value of improved health	p. 189
Threshold values and net monetary benefits	p. 192
Conclusion	p. 193
Costs and discounting	p. 195
Average vs marginal costs	p. 195
Identifying cost items: analysis viewpoint	p. 199
Health service costs	p. 200
Non-health service costs	p. 200
The discount rate	p. 201
Conclusion	p. 205
Equity issues: going beyond CBA and ICER	p. 207
Productivity changes and willingness to pay vary with income	p. 207
Health gains: size and distribution matter	p. 209
Severity: equality in prospective health	p. 210
Age: equality in total health	p. 210
Causes of ill health	p. 213
Consequences beyond patientsÆ health gains	p. 214
Conclusion	p. 215
References	p. 219
Index	p. 223
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