What are the implications of the RAND Health Insurance Experiment results with regard to the production of health from medical care? Draw the implied PF for health outcomes given medical care, indicate (and explain) the point where the HIE suggests we are at. What does this imply with regard to health care cost containment polices like higher co-insurance rates?

What are the implications of the RAND Health Insurance Experiment results with regard to the production of health from medical care? Draw the implied PF for health outcomes given medical care, indicate (and explain) the point where the HIE suggests we are at. What does this imply with regard to health care cost containment polices like higher co-insurance rates?

EBK HEALTH ECONOMICS AND POLICY

7th Edition

ISBN:9781337668279

Author:Henderson

Publisher:Henderson

Chapter6: Population Health

Section: Chapter Questions

Problem 9QAP

See similar textbooks

Similar questions

One curious finding from the RAND Health Insurance Experiment was that the rate of treated bone fractures per capita was higher in the group of families that had been assigned to the free insurance plan, compared with those in the high copayment plans. Concisely describe how the Grossman model might explain the fact that people facing higher prices for health care would break bones less often. Be sure to discuss the concept of marginal efficiency of health investment.
One of the most robust, fundamental “facts” of health economics is the SES and health gradient. a) Define the SES and health gradient. b) Give three ways in which the SES and health gradient is robust. c) Provide evidence that some of the gradient is correlational (i.e., give a potential confounder) and evidence that the gradient is in fact causal. d) i. Give an interpretation of Figure 1 below in layperson terms. ii. What pattern do you see for men vs women? iii. “The education and mortality gradient does not depend on healthcare spending or whether the country has universal healthcare.” Use Figure 1 to support or refute this claim.
The Akerlof model can be used to model the health insurance market. In this market, which party is analogous to car buyers? Which party is analogous to car sellers?What would it mean for the health insurance market to unravel?
[A] High-income Canadians tend to choose a higher desired health stock, even though they can afford more healthcare goods. Using the Grossman model, explain why this is the case. Use an appropriate graph to support your answer. [B] Suppose the funding agency switches both physicians' and hospitals' prospective payment to a system of retrospective payment, i.e., from salary to fee-for-service for physicians, and from global budget payment to activity-based funding for hospitals. Clearly explain each of these terms and how these changes will impact the utilization of physician and hospital services.
In the framework of the Grossman model, suppose there is an increase in the return in alternate non-health market investments. Draw what happens to the MEC curve and the optimal level of health. Explain intuitively why this might be the case in reality.
Indicate whether the statement is true or false, and justify your answer.In the framework of the Grossman model, an individual’s level of health is completely controlled by her actions. Thus, in any given period, an individual is unconstrained in her choice of health status.
Indicate whether the statement is true or false, and justify your answer.In the Grossman model, the marginal efficiency of investment in health care declines as health improves.
In the Grossman model of health production, people maximize lifetime utility overconsumption of health (H) and a composite of all other goods (X). In the model, health is a stockthat evolves over time and depends upon health in the previous period (Ht-1), investments inhealth during the previous period (It-1), and a depreciation rate (γ). The level of health in period tis Ht=(1- γ)Ht-1+It-1.a. Consider two individuals with H=50 in the current period. The two individuals areidentical except that individual A is 20 years old and has a γ of 0.1, while individual B is30 years old and has a γ of 0.2. Explain why it is more difficult for individual B tomaintain the same level of health as individual A.b. Give 2 real-world examples of how an increase in education would improve a person’sproductivity of health investment (I).
According to Grossman model, what would happen to the demand for health stock if wages go down? A) Would MEI shift to the right/left/stay the same? B) would MC curve shift up/down/stay the samer C) would optimal level of heath stock go up/down/stay the same?
The ongoing COVID-19 pandemic has disrupted both the education and health system in most, if not all, nations in the world. The scarring effects of the pandemic are predicted to be long-lasting, some of which are the fear of learning-loss and lower future earnings for the current students. Provide evidence(s) that support and/or contradict this statement! If such scarring is expected to occur, would the scarring effects would be worse for the developing countries than the developed ones, and whether the effects would be worse for certain groups such as the poor, women, children, etc.!
QUESTION 1The Grossman model views demand for health care as a result of the demand for “goodhealth”. Using the Grossman framework, answer the following:A. Discuss the utility of the Grossman model in the practice of modern healtheconomics.B. Describe two (2) factors that could influence the Cost of Capital (COC) in theGrossman model. C. Highlight at least three (3) criticisms against of the Grossman model
Assume that the daily demand for packs of cigarettes in the tobacco-addicted nation of Pcorian is Q=100−P Further assume that the marginal cost of producing a pack of cigarettes is §6, and that the market for cigarettes is perfectly competitive. Assume that each pack of cigarettes smoked does §6 worth of health damage to the smoker in the form of increased cancer risk and a total of §5 worth of health damage to the smoker’s neighbors via secondhand smoke. Finally, assume that all Pcorian cigarette consumers are aware of these costs. Suppose the government decides to pursue a Pigouvian solution to eliminate social loss. What sort of tax or subsidy would they implement, and what is the resulting quantity of cigarette packs purchased? 2. The opposition party in the Pcorian parliament loudly opposes the proposed tax plan as government meddling. The opposition leader invokes the Coase theorem and says that the socially efficient level of smoking will occur even in the absence of…