lecture15fall2006

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( , & B $ %' ( &) )" * +% ,& ) / 0 $ ) // +) -+ $/) $ % 4 3 + & %3/ , & Roughly 44 million individuals were uninsured for the entire 2002 calendar year, or 15% of the population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im 3 4+ 7 * + Although /) buys less expensive4+7 /) + . ,+ , 8 health insurance on his own, his8 net 8 % &% & income is lower! /% % * 4+7 + . * 4, + + , % &% %) $ + & ! H 9# # F (( , C( C(( # & ! 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[email protected]< G [email protected] # , 97 9 # : & , @<8. ? <B ? + ?+ 5 # ! 79 % 97 ! & & : 7 9 % # +& # & ! : , ! 9 @* + ? [email protected]< G [email protected] & @<8. ? <B ? + ?+ 5 + & &, ! & B7 % &G , & , , , ,, , + 9 , , D # & ,L E ! & 7! , , % ! & & 9 &G , , # &: , , C (( ( 2 9( 9 C( (! ! , , , , , 7 ! 1 , * , 9 &G H , , (0.99 × * $30,000 + 0.01 × $30,000 − $100 = 173.2 )( ) , 9 H U= Y (0.99 × $30,000 − $1 + 0.01 × $30,000 − $100 + $100 − $1 = 173.2 )( ) &G , + + & & ! + & , C! & & , , , , I @, , $! $ & , % & , 7, 9 , , 9 H & 9 7 & % , 77 && & C & ! , D /2 3E ! $ 10 I Price of each visit $ & 9 , # & #& %, , , , , , + Deadweight Loss A Health insurance shifts the consumers’ demand, leading This overto more consumption. consumption leads to deadweight loss. Q1 B The “right” amount of health care is where D=S. & +, & S=MC ! 9 & , 9 $100 ! C D Q2 Number of visits to doctor’s office $10 I I $ $ ! & , =, # , , > C , & ! & D !& !9 9 !E 9 ! ! $1 $ of Marginal Health Benefits IFurther spending nitially, dollars of spending lead to has diminishing high benefits. returns. $5 A , & , 9 $ ! & ,, & , , B C $1,000 $2,000 $5,000 $0.10 $ of Medical Spending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xcept for the uninsured, most Americans have generous health coverage. 9 H <! ! ! Quality of Health Insurance 44 million Population 13 * * "# $ , % <! !5 & 5 & ! : , , , F : ! & 9 @* ? [email protected]< G [email protected] I . + , , ! + 9 & ! , 9 $ @<8. ? <B ? 8 [email protected] . B 5 ! , H & : 9# !B = > & $ ! @, & , , !G , : , #& ! &$ ! + : 9 , , @* ? [email protected]< G [email protected] I . % , , % , ! $ $ @<8. ? <B ? 8 [email protected] . B 5 , : @* ? [email protected]< G [email protected] I . ( & @<8. ? <B ? 8 [email protected] . B 5 & ! %, , ! :$ # 7 =, , , , , , ! : + , 9 > ! 9, :$ H L 9 : , $! 14 I & % & & I & B & & 9 # /( 4 7 % #, I &# 7 / (! / ! @ [email protected] ! & * &$ &, ! @, 9 B # ))+ & # ,, # 7, , & ) & , , #7 ! I " & * &$ ,! 9 [email protected] ! $ 9 [email protected] B # +& " & # , # ! I I + & 9 7# E ! B [email protected] # ! # #7 : , D ) & 9 ! 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  • Fall '08
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  • Slovak Republic Korea Mexico Poland Luxembourg Turkey Finland Ireland Czech Republic Spain Austria United Kingdom Hungary Japan Italy New Zealand Norway Denmark Australia Belgium Netherlands Sweden Portugal Greece Canada France Iceland Germany Switzerland

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