RMI 3501 Lecture 5: Topic 5 notes
7 Aug 2016
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Document Summary
High degree of third party payment for healthcare goods and services. Er based distribution system for health insurance. Three parties in a typical healthcare transaction. (you can be a consumer and not have insurance) Third party, 2 parties if consumer doesn"t have insurance. Assumes financial responsibility for the transaction that occurs between. When you consume something, that implies a willingness. When you consume more, the degree in which it increases is not as high as the first time you consume. Weigh the true costs of good/services v. the true benefit of that service. Rational efficient consumption: consume to a point where for the last unit consumer marginal benefit (as seen by the user) = marginal cost (as seen by the user) Incentive to ask questions about price, necessity, and quality. Marginal cost as seen by the user with insurance decreases. Increases consumption further to reach a new equilibrium.
