IBE316-12 - IBE 316 Economic Policy Stiglitz Economics of...

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IBE 316 Economic PolicyStiglitz: Economics of the Public SectorChapter 12: Health CareKeisuke OTSUSophia University FLASpring 2008OTSU(Sophia University FLA)IBE 316Spring 20081 / 20
ReviewSocial cost-bene°t analysis is di/erent from private cost-bene°tanalysis becausethe government deals with non-marketed goodsthe government might discount the future di/erently from the privatesectorFor cost-bene°t analysis the government should take into account fornon-monetized costs and bene°tsthe present discount value of social cost and bene°ts from projectsthe risk premiumdistributional e/ectsOTSU(Sophia University FLA)IBE 316Spring 20082 / 20
OverviewFocus QuestionsWhat are the fundamental problems facing the health care systemtoday?What role does the government play in the health care sector today?What are the reasons for government action?What are some of the problems that arise from the fact that a largerfraction of health care costs are covered by insurance?What are the key public policy questions today?OTSU(Sophia University FLA)IBE 316Spring 20083 / 20
OverviewConcerns about health care systemsexcessive costs: health payments / GDPJapan 7.8% (2004)US 15.4% (2004)limited insurance coverageJapan (universal): 10% not paying (2005)US (voluntary): uncovered people 1/6 (2007)°scal strains providing health care: health expenditure / totalgovernment expenditureJapan: 17.2% (2004)US: 18.9% (2004)OTSU(Sophia University FLA)IBE 316Spring 20084 / 20
The Health Care System in the US and JapanThe Private SectorFee-for-service plans: doctors are reimbursed on the basis of serviceprovideddeductible: °xed amount paid by the planco-payments: the amount over the deductible paid by the individualHealth maintenance organizations (HMOs): in UScapitation fee: °xed annual fee paid to cover medical costsOTSU(Sophia University FLA)IBE 316Spring 20085 / 20
The Health Care System in the US and JapanThe Role of GovernmentUSMedicade: provided by states for poorMedicare: provided by the government for agedhospital insurancesupplementary medical insuranceJapan (and other OECD countries)Universal public health care (20-30% out-of-pocket)OTSU(Sophia University FLA)IBE 316Spring 20086 / 20

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