(精品)Chap009

Click to edit Master title style,Click to edit Master text styles,Second level,Third level,Fourth level,Fifth level,9-,*,Click to edit Master title style,Click to edit Master text styles,Second level,Third level,Fourth level,Fifth level,9-,*,CHAPTER 9,The Health Care Market,Copyright 2010 by the McGraw-Hill Companies,Inc.All rights reserved.,McGraw-Hill/Irwin,U.S.Expenditures of Selected Goods and Services as Share of GDP(1960-2007),Source:US Bureau of the Census 2009,pp.95,425,and National Income and Product Accounts,Social Insurance,Social insurance-government programs that provide insurance to protect against adverse events,Examples,Medicaid,Medicare,Social Security,Unemployment Compensation,How Health Insurance Works,Insurance premium,Expected Value,Expected value(EV)=probability of outcome 1)*(Payout in outcome 1)+probability of outcome 2)*(Payout in outcome 2)+(probability of outcome n)*(Payout in outcome n),Expected Value Computation,Draw cards from deck of cards,Draw heart and receive$12,Draw spade,diamond or club and lose$4,Probability of drawing heart=13/52=,Probability of drawing spade,diamond or club=39/52=,EV=(1/4)($12)+(3/4)(-$4)=$0,Why Buy Insurance?,Insurance Options,Income,Probability of Staying Healthy,Probability of Getting Sick,Lost Income if She Gets Sick,(A),(B),(C),Income if She Stays Healthy,Income if She Gets Sick,Expected Value,Option 1:No Insurance,$50,000,9 in 10,1 in 10,$30,000,$50,000,$20,000,$47,000,Option 2:Full Insurance($3,000 premium to cover$30,000 in losses,$50,000,9 in 10,1 in 10,$30,000,$47,000,$47,000,$47,000,Actuarially Fair Insurance Policy,Why People Buy Insurance,Income,Utility,20,000,47,000,50,000,U,A,U,C,U,D,U,B,D,C,B,A,Expected Utility,Risk Smoothing,Do People Buy Insurance with Loading Fees?,Risk Aversion,Risk Premium,Loading Fee,The Role of Risk Pooling,Insurance in a small population,Insurance in a large population,Law of large numbers,Adverse Selection in the Health Insurance Market,Asymmetric information,Asymmetric Information and Adverse Selection,(A),(B),(C),(D),(E),(F),Expected Benefit,Expected Benefit,Expected Benefit,Probability of,Lost Income,Expected,Minus Premium,Minus Premium,Minus Premium,Insurance Buyer,Getting Sick,if Sick,Lost Income,(Differential Premiums),(Premium=$3,000),(Premium=$4,500),Emily,1 in 5(High Risk),$30,000,$6,000,$0,$3,000,$1,500,Jacob,1 in 5(High Risk),$30,000,$6,000,$0,$3,000,$1,500,Emma,1 in 5(High Risk),$30,000,$6,000,$0,$3,000,$1,500,Michael,1 in 5(High Risk),$30,000,$6,000,$0,$3,000,$1,500,Madison,1 in 5(High Risk),$30,000,$6,000,$0,$3,000,$1,500,Joshua,1 in 10(Low Risk),$30,000,$3,000,$0,$0,-$1,500,Olivia,1 in 10(Low Risk),$30,000,$3,000,$0,$0,-$1,500,Matthew,1 in 10(Low Risk),$30,000,$3,000,$0,$0,-$1,500,Hannah,1 in 10(Low Risk),$30,000,$3,000,$0,$0,-$1,500,Ethan,1 in 10(Low Risk),$30,000,$3,000,$0,$0,-$1,500,Insurers Net Profits,$0,-$15,000,$0,Does Adverse Selection Justify Government Intervention?,Experience rating,Experience rating and equity,Community rating,Insurance and Moral Hazard,Moral hazard,Deductible,Co-payment,Co-insurance,Moral Hazard,Medical services per year,Price per unit,D,m,S,m,M,1,M,0,0,P,0,.2P,0,a,b,h,deadweight loss,Flat-of-the-curve medicine,Additional Considerations,The Elasticity of Demand for Medical Services,Does Moral Hazard Justify Government Intervention?,Third Party Payment,Other Market Failures in the Health Care Market,Information Problems,Externalities,Do We Want Efficient Provision of Health Care?,Paternalism,The Problem of the Uninsured,Who are the uninsured?,Does health insurance improve health?,High Health Care Costs,Source:Organization for Economic Cooperation and Development 2008a.,Causes of Health Care Cost Inflation,The Graying of America,Income Growth,Improvements in Quality,Commodity Egalitarianism,