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ch04.pptGetzen’s Health Economics & Financing, 5th Edition
Copyright © John Wiley & Sons, Inc.
Chapter 4: Health Insurance: Financing Medical Care
QUESTIONS
Who pays for losses: insurance companies or the people who buy insurance?
What is an “actuarially fair” premium?
Does pooling of funds reduce losses or reduce variance?
Do insurance companies take risks, or do they just put a price on risks?
Who takes care of people when they need medical care they cannot afford?
QUESTIONS cont.
Is a favor from a friend similar to a loan from a bank?
Are people who think they will become sick more likely to obtain insurance?
Are people with insurance more likely to sustain a financial loss?
Does company health insurance make people work more hours or less?
Does insurance increase or decrease the demand for medical care?
4.1 METHODS FOR COVERING RISKS
- Savings
- Family and Friends
- Charity
- Private Market Insurance Contracts
- Social Insurance
- Strengths and Weaknesses of Different Forms of Risk Spreading
4.2 INSURANCE: THIRD-PARTY PAYMENT
- Why Third-Party Payment?
- Variability
- Third-Party Transactions
- Who Pays? How Much?
- How Are Benefits Determined?
4.3 RISK AVERSION
4.4 ADVERSE SELECTION
4.5 MORAL HAZARD
- Be a safe driver!
- Welfare Losses Due to Moral Hazard
- Ex Ante Moral Hazard
4.6 TAX BENEFITS
4.7 EFFECTS OF HEALTH INSURANCE ON LABOR MARKETS
4.8 HISTORY OF HEALTH INSURANCE
Copyright 2013 John Wiley & Sons, Inc.
