Question

1. Describe and contrast the conventional and Nyman models of the demand for health insurance. 2. Discuss the economic reasons for government intervention in a market based health care system. Please be sure to incorporate the reasons identified in your text as well as any additional reasons you wish to provide. Provide a critique of these reasons. 3. Describe the structure and operation of Medicaid, Medicare and State Children’s Health Insurance Programs (SCHIP). Discuss the implications the proposed “repeal and replacement of the Affordable Care Act” would have for the three programs listed above.

Answer 1

1. Health insurance is considerably more important. Conventional theory holds that individuals buy protection since they incline toward the conviction of paying a little premium to the danger of becoming ill and paying an extensive doctor's visit expense. Conventional theory likewise holds that any extra social insurance that shoppers buy since they have protection isn't justified regardless of the cost of delivering it. Accordingly, financial experts have advanced strategies—copayments and oversaw mind—to decrease utilization of this extra, apparently low-esteem mind. In Nyman's hypothesis the supposition that all ethical danger is a welfare misfortune he expressed:-

• Cost sharing is often not appropriate, particularly for cost-effective, life-saving or health-preserving interventions,
• Subsidizing insurance premiums to encourage coverage is beneficial, and
• High health care prices are harmful because they discourage use of care.

2. The role and effects of government intervention in the U.S. health care system. These are people in general intrigue and particular vested party theo­ries of government conduct. As indicated by people in general intrigue hypothesis, government advances the general interests of society in general and picks strategies that upgrade proficiency and value. At the point when the market falls flat, government endeavors to reestablish productivity and advance value by empowering rivalry, giving buyer data, lessening hurtful externalities, or redistributing pay in the public eye. Thusly, people in general intrigue model of government conduct predicts that the laws, controls, and different activities of government improve effectiveness and value.