Question

Explain the role economics plays in the study of health and medical care? What does economics have to offer to consumers, medical providers, and insurance companies? What are the limitations of each stakeholder?

Answer 1

In the study of health and medical care economics plays a vital role, considering its one of the popular branch Health economics. In health economics. we study the distribution of resources of medical care, here health is considered as a private or public good.This branch of economics talks about the issues, effectiveness, efficiency, value and behavior of production and consumption of health and health care.It also analyses the health care market by formal cost, benefit management and consequences of the market. Importance of health economics are

• medical awareness among common people
• increasing life expectancy
• change in the medical expenditure of a family
• advance health research

Health microeconomics is offered and concerned with how individuals choose, minimize the cost or maximize profit or utilities within a given health care system within a set of rules.It tries to set the true cost of of delivering health care to every family of a nation.

For medical providers, one of the main feature of health economics is demand supply analysis to determine individual behavior, physical resource and cost,estimation of short and long term cost curves

For insurance company we use the market analysis of the health economics along with financial management that helps insurance companies to increase their market dominance within set of rules and the idea of providing equal cost health service to everyone

There are cost benefit analysis , cost effectiveness analysis, cost utility analysis, cost minimization analysis.One of the main drawback of this health economics we can not measures cost in terms of rare disease and we can not value of the quality of someone's life through some valuation method .