Health care economics and financing
Cost of health care is rising
- Ageing population requires more complex healthcare needs
- Better but also more expensive health technologies
Economics: science regarding the role of trade, manufacturing, mining industry, agriculture
and animal husbandry and the production, the distribution and the consumption of natural
resources and material goods in human societies.
➔ Science of managing limited resources and resources for competitive purposes to
improve/maximize people’s well being”.
o Resources is something you use to produce something/ to use something, to
get some usefulness. → resources are limited.
➔ Managing your household on national level.
➔ Balancing between options. → to get the most out of something.
➔ Trying to manage limited sources.
Scarcity: relative shortage vis-a-vis abundance of products/services and/or resources.
➔ Effective: doing what needs to be done (doeltreffend)
➔ Efficient: doing what needs to be done for the limited resources (doelmatig)
Health economics: application of various microeconomics tools to help solve health issues/
problems (Santerre & Neun)
➔ Microeconomics: demand and supply between individuals → consumers, buyers,
vendors, providers
➔ Macroeconomics: total economic environment → studies related to local, national,
regional and global economies
➔ Microeconomic transactions promote a better understanding of the economic aspects
of health care problems → design, proposal and implementation of corrective health
policies (what health economics should or could be doing)
➔ Here we have a social economic system. No social system → inefficient and unjust.
➔ What are the elements of health care system that consume a lot of resources? And
could we reduce the use of resources whilst getting the same or even better in terms
of the health being produced. (if u want to spend money on something else)
➔ Health care micro aspects determine or will help inform your politicians or will help
inform managers in hospitals about corrective health policy so that they could
manage things better.
➔ How to manage and monitor.
➔ All the choices has to do with producing or ‘selling’
➔ Everything begins with microeconomic tools.
,Microeconomics → macrolevel → decisions
Health technology Assessment: systematic evaluation of properties, effects, and/ or
impacts of health technology( tools u use to get healthy/ healthier).
➔ A multidisciplinary process to evaluate the social, economic, organizational and
ethical issues of health intervention or health technology.
➔ Health economics is just a small part of HTA.
Positive or normative
Positivise: description of ‘what is’: analytic account, parsing (= putting into small boxes) into
parts and searching for (causal) relations; gives knowledge over behavioural choices there is
only one answer. How people make choices
Something is cost-effective or not, something is desirable or not
- Objectief met cijfers en percentages
Normativism: description of ‘what should be’: synthetic account, placing reality in a greater
context; design, optimisation and prescription of behaviour; there is no single answer. What
would be the best option for everyone? Want to change behaviour
- Meer een mening
the positive statements deal with what is or what will be, whereas the normative statements concern what
is better or what ought to be.
Health economics themes:
- Allocative efficiency → doing what needs to be done for the limited resources
o Mix of medical and nonmedical goods and services that should be produced in
the macroeconomy
o Mix of various medical goods and services that should be produced in the
health economy
Hoeveel specialisten zet je tegenover een verpleegkundige
- Production efficiency → choosing the right resources to get the outcome you want
o Specific of healthcare resources to use for the production of the chosen
medical goods and services.
Hoeveel mensen ga je vaccineren en hoe voor het beste resultaat
, - Equity (equitablitiy). → doing what needs to be done for all who need care
regardless of background
o Selection of recipients of medical goods and services produced
➔ Equitability: doing what needs to be done for all who need care regardless of
background
Health economics problems:
1. Healthcare ‘wants’ are unlimited but healthcare technologies are not (becoming)
cheaper
2. Insufficient healthcare resources (limited money for supplies, personnel, buildings)
3. Healthcare market is not the same as traditional economic markets
a. There is government oversight/control (because it is a human right to get
health)
b. Healthcare can be traded but not health itself
c. Consumers/patients cannot make wholly transparent and informed choices.
Different relationships between micro- and microeconomics and all their concepts
Alan Williams plumbing diagram of health economics:
Yellow: the concepts you need for health economic evaluation
Green: health economic evaluation
Orange: different choices to the concepts lead to the orange boxes, they will affect the whole
system
Cost of health care is rising
- Ageing population requires more complex healthcare needs
- Better but also more expensive health technologies
Economics: science regarding the role of trade, manufacturing, mining industry, agriculture
and animal husbandry and the production, the distribution and the consumption of natural
resources and material goods in human societies.
➔ Science of managing limited resources and resources for competitive purposes to
improve/maximize people’s well being”.
o Resources is something you use to produce something/ to use something, to
get some usefulness. → resources are limited.
➔ Managing your household on national level.
➔ Balancing between options. → to get the most out of something.
➔ Trying to manage limited sources.
Scarcity: relative shortage vis-a-vis abundance of products/services and/or resources.
➔ Effective: doing what needs to be done (doeltreffend)
➔ Efficient: doing what needs to be done for the limited resources (doelmatig)
Health economics: application of various microeconomics tools to help solve health issues/
problems (Santerre & Neun)
➔ Microeconomics: demand and supply between individuals → consumers, buyers,
vendors, providers
➔ Macroeconomics: total economic environment → studies related to local, national,
regional and global economies
➔ Microeconomic transactions promote a better understanding of the economic aspects
of health care problems → design, proposal and implementation of corrective health
policies (what health economics should or could be doing)
➔ Here we have a social economic system. No social system → inefficient and unjust.
➔ What are the elements of health care system that consume a lot of resources? And
could we reduce the use of resources whilst getting the same or even better in terms
of the health being produced. (if u want to spend money on something else)
➔ Health care micro aspects determine or will help inform your politicians or will help
inform managers in hospitals about corrective health policy so that they could
manage things better.
➔ How to manage and monitor.
➔ All the choices has to do with producing or ‘selling’
➔ Everything begins with microeconomic tools.
,Microeconomics → macrolevel → decisions
Health technology Assessment: systematic evaluation of properties, effects, and/ or
impacts of health technology( tools u use to get healthy/ healthier).
➔ A multidisciplinary process to evaluate the social, economic, organizational and
ethical issues of health intervention or health technology.
➔ Health economics is just a small part of HTA.
Positive or normative
Positivise: description of ‘what is’: analytic account, parsing (= putting into small boxes) into
parts and searching for (causal) relations; gives knowledge over behavioural choices there is
only one answer. How people make choices
Something is cost-effective or not, something is desirable or not
- Objectief met cijfers en percentages
Normativism: description of ‘what should be’: synthetic account, placing reality in a greater
context; design, optimisation and prescription of behaviour; there is no single answer. What
would be the best option for everyone? Want to change behaviour
- Meer een mening
the positive statements deal with what is or what will be, whereas the normative statements concern what
is better or what ought to be.
Health economics themes:
- Allocative efficiency → doing what needs to be done for the limited resources
o Mix of medical and nonmedical goods and services that should be produced in
the macroeconomy
o Mix of various medical goods and services that should be produced in the
health economy
Hoeveel specialisten zet je tegenover een verpleegkundige
- Production efficiency → choosing the right resources to get the outcome you want
o Specific of healthcare resources to use for the production of the chosen
medical goods and services.
Hoeveel mensen ga je vaccineren en hoe voor het beste resultaat
, - Equity (equitablitiy). → doing what needs to be done for all who need care
regardless of background
o Selection of recipients of medical goods and services produced
➔ Equitability: doing what needs to be done for all who need care regardless of
background
Health economics problems:
1. Healthcare ‘wants’ are unlimited but healthcare technologies are not (becoming)
cheaper
2. Insufficient healthcare resources (limited money for supplies, personnel, buildings)
3. Healthcare market is not the same as traditional economic markets
a. There is government oversight/control (because it is a human right to get
health)
b. Healthcare can be traded but not health itself
c. Consumers/patients cannot make wholly transparent and informed choices.
Different relationships between micro- and microeconomics and all their concepts
Alan Williams plumbing diagram of health economics:
Yellow: the concepts you need for health economic evaluation
Green: health economic evaluation
Orange: different choices to the concepts lead to the orange boxes, they will affect the whole
system
