PPD 170 - Midterm Answers

PPD 170 - Midterm Answers - PPH122/PPD 170 Spring 2008...

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PPH122/PPD 170 Spring 2008 Midterm Name 1) Physicians are asked to take the Hippocratic oath in which they promise to do no harm to their patient (check only one) a) because they are expected to be knowledgeable about the classics b) because the asymmetry of information between patients and physicians makes it difficult for physicians to understand their patients c) X because the asymmetry of information between patients and physicians makes it difficult for patients to monitor the quality of care physicians provide 2) Recently, there have been efforts to minimize the use of antibiotics when children develop ear aches because (check only one) a) it is important for the economy b) X antibiotic use creates a negative externality by increasing the development of antibiotic resistant strains c) it can cause side effects 3) The productivity of medical care (check only one) a) is the same for all diseases b) is the only factor that determines health c) X exhibits diminishing marginal returns 1 (10 points) (10 points) (10 points)
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Spring 2008 Midterm Name 4) Do you agree with the following statement: “The RAND HIS and other empirical studies suggest that we are practicing flat of the curve medicine, and therefore, there is no value to medical care.” Discuss. The first part of the statement is correct. There is a large body of evidence that suggests that the marginal productivity of medical care, in the aggregate, in the U.S. is zero. However, the value of medical care is determined by the average productivity, not the marginal. The average productivity is high, indicating that medical care is valuable. The zero marginal productivity suggests that further expansion of medical care may not be warranted. One should also note that this evidence is conditional on current technology. Future technological advances can again increase the marginal productivity of health care. 5) Describe the 3 important characteristics of health care and explain how they influence the health care system. Uncertainty: It creates demand for insurance which in turn lowers the effective price to consumers and increases demand. It also affects physicians’ decisions regarding tests, diagnoses and treatments. It makes it very difficult for patients to evaluate the quality of care they receive because quality cannot be inferred directly form outcomes. 2
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This note was uploaded on 06/02/2008 for the course POLICY, PL 170/122 taught by Professor Mukamel during the Spring '08 term at UC Irvine.

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PPD 170 - Midterm Answers - PPH122/PPD 170 Spring 2008...

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