Question

Evaluate hospitals’ likely “willingness to pay.” Contrast this with the value-in-use analysis. Type you answer.

Answer 1

The quality of health and people's demand for health care is increasing over the years. A large number of people still don't use or avail health services and hospitals due to the high prices in the private sector and the failure of government hospitals or the public sector. The lack of facilities in public hospitals is due to the overcrowding and lack of proper facilities in public hospitals. The contingent valuation method can be used to understand the willingness to pay for the facilities. In the case of healthcare, the willingness to pay can be for the quality improvements in the hospitals. This approach helps in assessing the potential behaviors of the consumers. The government and private hospitals can use this information to develop the health care facilities according to the need of the consumers. The willingness to pay method is very effective in the current situation where the cost of health services is increasing and the demand is increasing as well. This methof also helps in understanding and evaluating the already available services and the values associated to it. By doing so there is a chance of redistributing or reanalysing the value with the informations collected from the willingness to pay method.