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114 Cards in this Set
- Front
- Back
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What do Economists define health as
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durable good
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What is economic health
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a good that proves servies over the course of a persons life
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Everyone is born with
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a ceratin stock of health
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Stock of health can be augmented by
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investments in health care
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Death occur when
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your stock of health falls below some critical level
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What is health care?
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collection of goods and services that maintain, improve or restore a person's physical, mental and social well-being
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Health care inlcudes some goods but mostly
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services
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What are determinatnts of HEALTH
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GAME LIE
genetics, age, martial status, environment, lifestyle income, and health care |
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The deman for health care is what type of demand
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derived, as health care is one of inputs in the production of health
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What are factors affections DEMAND for health care
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GOUP BIG A
Genetic presipostion, opportunirty costs, utility and price of all other goods, preception of need, belief about efficacy, income, gender, and AGE |
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When will a individal maximizing purchase of health care
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when the MU of health care/price = MU of other goods dividied by price
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What are benfits of competive markets
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economic effecicent and appropirate use of resources is encougrage, good that consumers want is produce, and output price levels are optimized
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Must conusmers have perfect infromtion for competition
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YES
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What are barriers to entry the health care markerts
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land, finacing, and governement regulation
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How does govnement regulate HC
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liscensure, and outsight through regulatory agentics
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The Consumers however has IMPERFECT information b/c
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lack informatino about a good leads to rasing of prices, lack VALUE and consumers cannot safely use procuts wihtou adivce form health care provides
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What are requires for PERFECT competions
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cosumers pay full price, firms maxmize profits, large nubmer of buyers, product is stand, no barriers and have perfect info
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Does consumer pay fulls price?
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NO consumer does not bear full cost
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What impact does consumer NOT paying full price have on deamn
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cosumer will purchase more, b/c out of pocket cost is lower
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What is moral hazard consumer NOT bearing full cost
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increase utilization of heath care from insurane
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What to many economists belive is the major factor in the increase in health care costs
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excess demand
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Why is insurance a moral hazard
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cosumers purchase more, take more health risks, do not engage in price shopping, less likely to question necessity
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What effects does Co-Pay price have on demand
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lower copay price, increases demand for health care
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Because the health care market is not perfectly competitive what does it lead to
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market failure
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Highest output with lowest cost occur in what type of market
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Perfect competition
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What happesn to Markets in oligopolies or monopolies
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output is lower, adn price is higher
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Will increased copays have a higher impact on health care serices with elastic or inelastic
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elastic
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If health care were free would the quantity demanded by unlitmited
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no, opportunity cost still exist
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The number of physicains has increased over time, however what are barriers to entry
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degree, licensrue, accrediation of school, and entry of forgein graduates is controlled
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The provision of physician services includes more than just the labor of physcian it also includes
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nurses, medical supplies, equipment, and office space
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Are self-employed physican a profit maximizer
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YES
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What is fee-for-service form of insurance
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unrestricted use of services
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What impact did managed care have on physicans
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physicans became employee, placed limits of reimbursements
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What happen to degree of monopoly power of physicans
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has decreased over time b/c of managned care, physicna can no longer decide what to charge
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Hospital in the same market have
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similar inpatient services
and operate in same geographical area |
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May a tertiary care hospital market be regional or national
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YES
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What type of market are hospital considered, and why
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oligopolistic, high barrier to entry and few hospital in market
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What is general result of managed care
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lower utilization of hospital services--and SPENDING GROWTH decreased
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Where is demand for pharamcist dervied from
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demand for prescriptions
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Where is the prescription dispensing process is there an alternative input for pharmacist labor
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prescription processing
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Where is the prescriptoin dispensing proess in there NO alternative inupt
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prescription checking
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What type of market is pharamcist
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monolopy through regulation
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What are cognitive services provided by a pharmacist, and is it INDEPENDT of dispensing function
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services that are judgmental or educational in nature, YES
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Pharmacist labor is an input in the process of prescriptino processing, what other other inputs in the dispening process
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building, techs, and stocks of medications
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What are general therapetic outcomes of cognitive servies of pharmacist
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prevention, diagnosis, or cure, elmination or reduction of symptoms and prevention of adverse drug reactions
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What is disease state management?
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the continous corrdination process that seeks to managae and improve health status of patient over the course of the disease
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Pharmacist Roles in Disease State management
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target high risk patients, and assit in cost-effective of drugs
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What are collaborative practice agreements
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pharamcist can initate, modify or continue drug therapy in accoradance with written guidelines
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Benfits of Collaborative practice agreements
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address inefficienies, and improve genral public health
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Physicans have moved from a firm to a, causing
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employee--which decrease monolpoy power
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Hospital have defined payment sturcture which has causes
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decreasing monopoly power
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What provides pharamcist monopoly power
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regulation of CHECKING--dispensing
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Currently pharmacist are not reinburshed for their cognitive services, and are likely to be
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MORE COMPETIVIE--we must show value of our cognitive services
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What are 4 components of pharmaceutical industry
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1. Competitiveness
2. Industry Profits 3. Drug prices 4. Marketing |
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What does Herfindal-Hirschman Index HHI and values
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measures degree of concentration in market 0 to 10,000
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The lower the HHI
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= MORE COMPETITION in market
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What is 4-firm ratio
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amount of industry output is accounted for by top 4 firms
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According to HHI the is the market for pharmaceutical considered
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competitive
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In a perfectly competitive market products are highly substituable, what about therapetuic markets?
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may fit definition of oligooply
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Are their barriers to pharmacetucial industry, and what
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YES, research and development and patent
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What do patents do to market
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make monopoly
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What is the goal of the pharmacetuical industry
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maximize profits
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Some companies calcuation that pharamacetucial companies make excessive profits, but pharmaceutical say otherwise why?
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they include opportunity and administrative cost in calculations
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Industry wants to maximize profits, but Orphan drugs means drugs with small markets--so what triiger a company take such a risk
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Government intervened to sweeten pot
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Patents for drugs are lower in Canada, adopting similar price controls would have what effect on R&D
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neagative effect
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Pharmaceutical companies will not always lanunch new drugs in countries with
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price controls
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What are managed care organization incentrive to minimize expenditures on pharmaceuticals
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large buys, and lower prices in exhange for formulatry status
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According to PhRMA drug prices are not increasing what are
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DRUG expenditures... increased VOLUMES accounts for increase spending
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What are higher prescription durg expenditures are largely due to
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to OVERALL increase in use of or volume of prescription medicaitons
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Why factors are contribuing to USE of MORE DRUGS
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aging of the popultions, expanding insurance coverage, more drugs available,
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What is moral hazard of expanding insurance coverage
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leads to increase in quanitity demanded for pharmaceuticals
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How can we contain the increasing drug expenditures
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inceasing Co-PAY, and have policy initiavies by having improved health
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Pharmacy has new drugs for more diseases,AND NEWER medications are more expensive waht is the benift
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improving treatments and guidelines, which leads to better health outcomes
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Why are higer drugs prices better in the long run
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decreases cost long run and has better health outcomes
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What is increasing use of drugs part of the solution, not the problem
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LOWER mortailty, fewer days of lost work, adn lower health care spending in all NON-DRUG areas
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Limitiation of drug coverage lead to what
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overall HIGHER health care costs
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GOODS SIDE OF MARKETING ENABLES new (me-too) drugs
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gain market share which leads to more substituions leading to lower prices,
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BAD SIDE OF marketing
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inapproriaetly influence patietnts to seek unncessary care
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What is impact of advertising on physcian prescribing behvaior
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half of request for a particular drug are filled with another drug
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What is another benfit of advertsing of consumer
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educational, initiates dialouge between pateints and doc, leading to better clinical outcomes
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What are benefits of drug samples
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more people access to drugs who cannot afford them,
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Better for drugs samples for advertising company
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the availaablity of drug samples leads to greater use of that drug in health care
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What are cost containment strageis for patients, systems, and policy
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pateints--incrased co-pay,
2. systems formularies and prior auths 3. polcies buy having initaive to improve health |
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What is risk
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possibly of danger, injury or harm
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What are 2 components of Risk
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Uncertanity--probabilyt event will occur
2. Consequenes loss or harm |
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What is the benfit of measuring risk or consequences
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make better decisions
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What is when Relative Risk is >1
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one group has great risk
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What are 3 reasons we accept risks
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involuntary, potential benefits are worth it and fun
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What are 4 points of Risk Management
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1. Identify and avoid
2. Regulate and Legislate 3. Policy initiative 4. transfer to someone else |
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What are examples of identify and avoid risk
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vaccaines, food processing and water safety
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Can we avoid all toxins
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almost impossible-complex plants contain pestiicides, and vitamins
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WHat is best options for identify and avoid
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reserach, and choose best option, avoid major risks
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How is risk management regulated
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when perceived to involuntary (Seat belts), risk are unknown
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What is risk mangement policy
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having cholestreol screening, having blood pressure screenigns
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What is transfer of risk
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buying insurance
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Insurers insure based on the assumptions that premiums collected at least cover
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health benefits and administrative costs
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Is maxmizing marginal untilty for demand for health insurance same as demand for health care
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YES
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The marginal utility of the last dollar spent on health insurance must equal
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the marginal utility of the last dollar spent on all other goods
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How does demand for health insurance differ from the demand for health care
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risk issues uncertainty and degree of risk adversion
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The demand for health insurance is mainly driven by
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RISK adversion
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The more risk adverse you are the
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higher demand for insurance and higher the coverage you want
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Why is health insurance realate to RISK
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you have to why the uncertainty (proability of coming ill) and the consequences of NOT having having insurance
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Demand for health increase decreases when the probabilty of the event
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is very low or VERY HIGH
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What is benefit fo indemnity insurance or (fee for service)
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complete coverage, cost varies
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Whhich type of insurace do you have freedom-of-choice
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fee for service
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Who is at risk for Fee for service
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insurer or purchaser at risk
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What is HMO care
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care coordinated by PCP
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Do you freedom of choice for HMO
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NO--only fee for service, increase limited acess to provied
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Which insurance has cost varies by level of out-of-pocket payments vs low member out-of cost
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Fee for sercie--cost varies, and HMO has low member out of pocket costs
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Who is at risk for HMO
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shift of risk to providers
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What are 2 levels of PPO
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network--providers provide sercies to covered indicauals at a discounted rate, and 2. out-of-network pay more
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How are health insurance premium rated
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Community rating, and expericne rating
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Whos are risk for Fee for serice, HMO, and PPO
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Fee for serice--insure or purchaseer
HMO--provider PPO-risk to network providers |
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Does health insurance decrease finicanil risk for consumer, and increases access to care
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YES
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