Question 1

Broadly speaking: What is "health" ? (2) What is the purpose of insurance? (2) How do we marry the above two concepts to understand the purpose of 'health insurance'? (3)

Accepted Answer

Health refers to a state of being where one is free from illness... ...in relation to one's mental and physical wellbeing The purpose of insurance is, broadly speaking, prepaying and pooling of funds... ...to mitigate losses arising from a contigent event Health insurance is purposeful because no-one plans to get sick or hurt (mentally or physically), but in the event that this happens, medical care is needed health insurance covers the costs associated with this, and offers many other important benefits health insurance protects against unexpected, high medical costs

Question 2

What are some consumer needs which are met by the use of health insurance? (8)

Accepted Answer

1. Medical expenses 2. Loss of income 1. Directly 2. Ability to earn income 3. Other members of household 3. Household expenses 4. Cost of lifestyle changes 5. Debt

Question 3

Health systems, collecting of funds: How might funds be collected? (6)

Accepted Answer

1. General taxes imposed by the State 1. VAT 2. Income taxes 3. Corporate taxes 2. Earmaked taxes, taxes earmarked specifically for provision of healthcare 3. Premiums

Question 4

Health systems, collecting of funds: What kind of cross subsidies might exist in terms of collecting funds for provision of healthcare? (7)

Accepted Answer

1. Social solidarity 2. Subsidies varying in their extent 1. min payment/funding requirement, 2. max payment/funding which may be imposed, 3. sliding scale for funding depending on other factors 3. Income cross subsidies 4. Cross subsidies between generations (younger subsiding the older)

Question 5

Health systems, resources pooling: What types of 'resource pooling' might be found in health systems...i.e. who might pool resources/funds? (6)

Accepted Answer

1. State pooled resources 2. Mutuals 3. Insurers 4. Individuals 5. Donors 6. Employers

Question 6

Health systems, resources pooling: Give examples of factors to be considered due to having multiple pools within a health system (3)

Accepted Answer

Multiple pools (vs single pools) leads to factors such as competition between insurers (may be both good and/or bad) pool fragmentation (usually bad) the need for risk equalisation (additional administration/cost)

Question 7

Health systems, resources pooling: When resources are pooled within a health system, what kind of tiers may be introduced in so far as provision of benefits is concerned? (3)

Accepted Answer

1. Different populations may have access to different benefits 2. Benefits provided may be means tested 3. Social security pillars may be used/enforced

Question 8

Health systems, resources pooling: What influence does pool size play in a health systems' ability to provide health services? (8)

Accepted Answer

Large pools are better than small pools because ...the larger the pool.. ...the bigger the share of contributions which can be allocated exclusively to health services this is manifested through, for example, economies of scale greater ability to carry risk reduced need for solvency margins But beyond a critical size, economies of scale show diminishing returns In addition, the argument for large pools, is not the argument for single pools

Question 9

Health systems, purchasing: Regarding purchasing/provision of services within a health system, what key factors arise? (1) What does this lead to? (3)

Accepted Answer

Limited budgets/supply and competing demands This leads to the need to ration healthcare benefits by considering: what benefits are/need to be offered? who gets what benefits? who decides and how?

Question 10

Health systems, delivery: In what various ways may healthcare services/benefits be delivered via a health system? (6)

Accepted Answer

1. Hospitals 2. Doctors - GPs and specialists 3. Pharmaceuticals 4. Equipment 5. Traditional medicine 6. Allied professionals

Question 11

What key aspects usually characterise or can be found prevalent within a healthcare system? (7)

Accepted Answer

Its perception as a basic human right - universal access Information asymmetry Limited supply Rapidly rising demand and costs of healthcare Mutuality vs solidarity Principle agent issues The "3rd party payer problem" Issues arising due to the existence of insurance

Question 12

What do we mean by "information asymmetry" in a healthcare context? What causes information asymmetry in the healthcare environment?

Accepted Answer

Information asymmetry arises where there is a significant difference in material, relevant information possessed by parties/stakeholders involved in the provision/consumption of healthcare services. Causes the health industry has quite irregular consumption so lack of experience, different experiences not comparable, results often related to biology and not service quality

Question 13

What factors lead to the rising demand for healthcare over time? (8)

Accepted Answer

Technological developments Demographic changes e.g. ageing populations in many countries The burden of disease e.g. lifestyle diseases Increased exposure, access and expectations Information asymmetry Supplier induced demand Existence of a third party payer Existence of insurance Cultural trends e.g. C-Section rate in SA

Question 14

What do we mean by _mutuality_ in a health insurance context?

Accepted Answer

Mutuality: similar to a pooled fund premiums based on risk profile ie all known risk factors disadvantage is that some policyholders will be excluded due to high risk or high premiums benefits also limited by contract, thus some treatment may not be covered denies universal access

Question 15

What do we mean by _solidarity_ in a health insurance context?

Accepted Answer

Solidarity: premiums not based on risk, but according to ability to pay (community rating) benefits paid according to need underpins national/social health insurance can lead to anti-selection... ...so often insurance is compulsory to avoid free-rider problem. Can have subsidies for those who can't afford can lead to cross-subsidies (income, age, health status) in SA there is open enrolment for unrestricted funds: funds must accept anyone at standard premium rates and minimum benefit package

Chapter 0 Introduction to Health and Care Flashcards

Describe the main types of health and care insurance contracts: -private medical insurance -health cash plans -main example variations of contracts issued.

Brainscape's Knowledge GenomeTM

Chapter 0 Introduction to Health and Care Flashcards

Describe the main types of health and care insurance contracts: -private medical insurance -health cash plans -main example variations of contracts issued.

Brainscape's Knowledge Genome^TM