StudentShare
Contact Us
Sign In / Sign Up for FREE
Search
Go to advanced search...
Free

Answer the following 2 questions seperately - Assignment Example

Cite this document
Summary
The two main theories that describe the motivation behind government intervention in healthcare market are the special interest group theory and the public interest theory. In special interest group theory, special interest groups realize wealth transfers in resources that are…
Download full paper File format: .doc, available for editing
GRAB THE BEST PAPER93.5% of users find it useful
Answer the following 2 questions seperately
Read Text Preview

Extract of sample "Answer the following 2 questions seperately"

Management   Question a) Comparing and Contrasting the Public and Special Interest Theories That Describe the Motivation behind Government Intervention in the Health Care Market The two main theories that describe the motivation behind government intervention in healthcare market are the special interest group theory and the public interest theory. In special interest group theory, special interest groups realize wealth transfers in resources that are scarce. This situation results into the public being compelled to pick-up the expenses stemming from the inefficiencies stemming from this model.

Basically, to actualize and consolidate their profits, these special interest groups clamor to keep the system in a manner that will benefit pharmaceutical and insurance companies, as well as healthcare institutions. On the other hand, public interest theory asserts the need to keep prices at reasonable rates so that more people can access healthcare services; and that more readily and cheaply. As such, the government should intervene to ensure that the best interests of the society are served.

In this light, there is the push to have the government inject and nurture competition, liberalize information, assuage externalities and to address market failures (Sirgy, Dong-Jin & Yu, 2011). (b) Personal Choice of a Theory as the Most Accurate Public interest theory is the most plausible and tenable of the two, since healthcare market primarily discharges public or social goods. Healthcare is too sacrosanct to be given an economic laissez faire. Likewise, it is very inappropriate and unfortunate to create a situation in the healthcare system where the public bears the burden of operational inefficiencies as players in the business (pharmaceutical and insurance companies, and healthcare institutions) rake profits.

If the system that is envisioned by the special interest theory must be adopted or tolerated, healthcare systems must be exempted from such contriving. Question 2: Imperfect Information in Health Care and How It Impacts the Efficiency of the Market Imperfect information refers to a situation where the client or the seller does not have partial or full information that may affect their decisions. For instance, in a perfectly competitive market, though healthcare services insurers are entitled to full information pertinent to clients’ health status so that they can subsequently exact premiums in light of the expected costs, some clients will reserve themselves from detailing all the crucial information.

Again, these clients may deliberately or inadvertently give inaccurate details. Most of the time however, clients will knowingly withhold information or give incorrect details to escape higher insurance premiums. The import of this development is that it often paves way for market failure, since the giver of the inaccurate or incomplete detail has a competitive edge (Wilson, 2011). Another way in which imperfect information negatively impacts efficiency in the market is by encouraging moral hazards.

A moral hazard occurs when people are allowed to purchase an insurance cover for an adverse circumstance, but the client’s behavior is difficult to monitor. This later compels the insurance provider to make information, merely on estimates, instead of facts. The situation festers when the insurance company has to give flat-rate levels of compensation, besides factoring in this imperfect information. Conversely, imperfect information negatively impacts efficiency in healthcare market through adverse selection.

This happens when imperfect information compels insurers to make a given price quotation, while intending to diffuse costs by spreading them over other stakeholders. Alternatively, these insurers may resort to using their profits which they had accrued from low-risk clients, to diffuse losses that have been incurred from high-risk clients. This may lead to instability in premium rates in the healthcare market. ReferencesSirgy, M., Dong-Jin, L. & Yu, G. (2011). Consumer sovereignty in healthcare: Fact or fiction?

Journal of Business Ethics, 101 (3): 459-474. Wilson, L. (2011). Safety net for needy. Healthcare leaders want providers to put focus on primary care. Modern Healthcare, 41 (32): 22-3.

Read More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Answer the following 2 questions seperately Assignment”, n.d.)
Answer the following 2 questions seperately Assignment. Retrieved from https://studentshare.org/management/1598222-answer-the-following-2-questions-seperately
(Answer the Following 2 Questions Seperately Assignment)
Answer the Following 2 Questions Seperately Assignment. https://studentshare.org/management/1598222-answer-the-following-2-questions-seperately.
“Answer the Following 2 Questions Seperately Assignment”, n.d. https://studentshare.org/management/1598222-answer-the-following-2-questions-seperately.
  • Cited: 0 times

CHECK THESE SAMPLES OF Answer the following 2 questions seperately

Managing Research and Information

Is the service of the company thru its customer good enough What other additional services will the manager add in order to attract customer Who and how many staff will be involve How the improvement will generate profit to the company What will be the equipments and other apparatus needed Is it cost effective or practical to add How long the project will last Who will conduct the research These are some of questions that can be considered during the research.... By using the qualitative study the company will be able to probe questions to both distinguish the driving purchase behaviour and to understand why the factors are important....
8 Pages (2000 words) Essay

Applying TAM on Internet Banking: Survey

An author of the essay "Applying TAM on Internet Banking: Survey" discusses the point that the stress in the survey has been with the growing population and the one which would have the power to spend and the inclination to spend or transact business.... hellip; A random sampling of twenty university students was done to cover a wide spectrum of people from various walks of life....
4 Pages (1000 words) Essay

Customer Survey Assignment

Scientific surveying or better known as statistics provides an accurate means to collect data from a group of respondents.... It is systematic, and is therefore very careful in establishing patterns and results.... The resulting data from respondents may be perceived as accurately… This is also called statistical inferences....
5 Pages (1250 words) Essay

Parfits Spectrum and Sorites Paradox

arfit suggests the following: “But this is not the case with the final spectrum.... It is possible to illustrate this relation by the following example: there is a golden statuette of Oscar....  The survival following Parfit is present in the case of a character who possesses “character and apparent memories” (Ibid....
7 Pages (1750 words) Case Study

Body Image Satisfaction in Adolescent

The scale used was a satisfaction scale of 1-5 was used where 1 represented NEVER and 5 OFTEN to the questions asked.... The paper "Body Image Satisfaction in Adolescent" discusses that adolescents who report more exposure to appear on TV, extra frequent appearance conversions with peers and friends, and higher levels of appearance criticisms from peers and friends report higher internalization....
5 Pages (1250 words) Research Paper

Outline for topic research

The final paper will not be split into different sections to answer the separate questions although they will be introduced as two separate questions.... There is an abundance of information on linguistics and especially regarding the chosen topic of pragmatics and the two specific research questions: 1.... All the articles chosen were selected because of their relevance to the research questions and they all have a general agreement in the context of the research questions....
2 Pages (500 words) Essay

Analyzing Discourse Community: Perdue Civil Engineering Community

"Analyzing Discourse Community: Perdue Civil Engineering Community" paper involves an analysis of the environment with respect to goals of the community, the significance of the environment and class-based set up, and communication that prepares the university students for their engineering duties....
6 Pages (1500 words) Coursework

Media: The Nudity Advocate

They are between ages 16 to 25 years and are exposed to the very same questions regarding the media's role in influencing minds to accept nudity as a normal aspect contemporary of life.... This research begins with the statement that the media today ranks as one of the most flourishing industries in the business fraternity, employing audio, print, and video tactics of an exhibition to reach out to the society....
6 Pages (1500 words) Research Paper
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Contact Us