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Lesson 7 - fundamentals in health economics
Università degli studi di Bologna health economics and management / economia sanitaria e management Curriculum decision making in health care
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- Plan choice involves selecting different levels of health care coverage based on individual preferences, but the identity of the buyer can affect expected costs and hinder competition.
- Total variation in healthcare expenditure is mostly due to random factors (about 75-90%); systematic variation that humans can explain accounts for only about 10-25%.
- Adverse selection occurs when high-risk individuals are more likely to purchase insurance, leading to financial losses for insurers and less efficient markets due to asymmetric information.
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