Introduc on to the Economics of Health and Medical Care Session 1A—January 5, 2015 Health Economics PHARM 568 Winter 2015
Co-Coursemasters: Lou Garrison, PhD Norma Coe, PhD
1 Agenda
• Course Objec ves, Overview, and Resources • Economic Way of Thinking • Is Health Care Different? • Microeconomics Reminder • Stylized Facts and Sta s cal Overview
2 Course Objec ves
• Master key economic concepts and analy cal tools needed to analyze human economic behavior in general.
• Understand and apply microeconomic principles to analyze the major issues of the health care sector.
• Understand the key ins tu onal and market factors that affect the incen ves of the stakeholders in the key health care markets.
• Understand both the perspec ve and limits of economic analysis applied to health care.
• Gain some historical economic perspec ve on the evolu on of major health policy issues 3
Assignments and Grading
Biweekly Homework Assignments A. All students are expected to complete the four weekly homework assignments. Each will require a 500-1000 word short essay of topic of interest. B. All par cipants will complete a take-home exam midway in the course. C. Final exam will be scheduled for in-class during the scheduled me block
GRADING:
Classroom Par cipa on 5% Homework assignments 20% Midterm 30% Final Exam 45%
Grading will be based on student performance using the grading system for graduate students published in the 2002 - 2004 University of Washington General Catalog for Graduate and Professional Students, pp. 13.
4 Lectures
5 Key Economic Terms and Concepts
• Adverse selec on • Experience ra ng • Opportunity cost • Cer fica on • Externality • Parallel import • Coinsurance • Hyperbolic discoun ng • Pareto op mality • Community ra ng • Human capital • Posi ve economics • Consumer surplus • Indemnity • Post-experience good • Consump on • Inferior good • Price discrimina on • Cost efficiency • Informa on asymmetry • Price elas city of demand • Cost-benefit analysis • (Internal) rate of return • Private goods • Cost-effec veness analysis • Interna onal reference pricing • Public goods • Cost-u lity analysis • Investment good • Reference pricing • Decision fa gue • Licensure • Residual claimant • Deadweight loss • Loss aversion • Shirking • Deduc ble • Luxury good • Status quo bias • Defaults • Market concentra on • Sunk cost • Demand • Market failure • Supplier-induced demand • Differen al pricing • Monopolis c compe on • Tax subsidy • Discount rate • Monopoly • Technical efficiency • Dissipa on of rents • Monosony • Therapeu c reference pricing • Economic efficiency • Moral hazard • Uncertainty • Economic rents • RBRVS • Welfare economics • Economies of scale • Necessity good • Welfare loss • Economies of scope • Normal good • Equilibrium • Norma ve economics • Experience good • Nudge
6 Readings
Handbooks of Health Economics (Vols IA and IB). Culyer A and Newhouse JP. (eds.) 2000. Handbooks of Health Economics, Vol. 2, Pauly MV, McGuire TG, and Barros PP (eds.), Elsevier/NH, 2011.
Here is the UW link to the Handbook of Health Economics: h p://uwashington.worldcat.org.offcampus.lib.washington.edu/wcpa/oclc/690107506?page=frame&url=h p %3A%2F%2Fwww.sciencedirect.com%2Fscience%2Fhandbooks%2F15740064%26checksum %3Dd9a3c797d966ba524cd5a34433ea16fd&