Advanced Health Economics

Spring 2006

Li Ling

Class Time and Location: Tuesday 9am-12pm, CCER small classroom

Office Hours: Friday 4pm – 5:30pm, or by appointment

Office location: Langrenyuan 201

Phone: 6275-6263

E-mail: lingli@ccer.pku.edu.cn

       This course is designed to provide Master’s and Doctoral students with an opportunity to develop and sharpen their interests and skills in economic analysis of health and health care. The course teaches the allocation of health care resources, with respect to macroeconomics and health care; the demand and supply of health care; the production of health; the demand for health insurance; asymmetric information and agency; supplier-induced demand; the pharmaceutical industry; profit and nonprofit hospitals; roles of physicians; managed competition and health insurance; market imperfections and governmental role in health care; government intervention in health care markets; social insurance; comparative health care system, and China’s health care system reform. It will be organized around the text The Economics of Health and Health Care, 3rd edition, by Folland, Goodman, and Stano (FGS). The bibliography in FGS will serve as a more extended reading list for those who wish to delve into topics more extensively. Students are expected to read assigned materials prior to the class. Selected materials will be available online.

       Students will be responsible for the following assignments:

1st   class presentation(on others paper)             10%

One term paper (15 - 20 pages)                    30%

2nd  class presentation (on your paper)          10%

Final exam                                       50%         

 

 

Papers and Presentations

       You will be assigned a topic to present other’s paper in class. The term paper (and presentation) will be prepared as original work from the database or data collected by you. You are required to use appropriate data analysis and econometric techniques.

 

Topics and Readings

The Health Care Economy

       FGS, 1.  Chapters 2 and 3 may be used for review if necessary.

       Fuchs, Victor, "Economics, Values, and Health Care Reform," American Economic Review 86 (March 1996): 1-24.

       Zweifel, Peter, and Friedrich Breyer, Health Economics, New York: Oxford University Press, 1997, Chapter 1.

Dranove, David. The Economic Evolution of American Health Care. (Princeton, NJ: Princeton University Press, 2000).
Supply and Demand

       FGS, 4, 6

       McKinlay, John B., and Sonja M. McKinlay, "The Questionable Contribution of Medical Measures to the Decline of Mortality in the United States in the Twentieth Century," Milbank Memorial Fund Quarterly/Health and Society 55 (1977): 405-428.

Grossman, Michael, The Demand for Health, New York: Columbia University Press, 1972.

       Grossman, Michael, "On the Concept of Health Capital and the Demand for Health," Journal of Political Economy 80 (1972): 223-255.

       Zweifel, Peter, and Friedrich Breyer, Health Economics, New York: Oxford University Press, 1997, Chapter 3.

       Olsen, Jan Abel, "But Health Can Still Be a Necessity," Journal of Health Economics 12 (1993): 187-191.

       Goodman, Allen C., Stano, Miron, and Tilford, John M., "Applications and Extensions of the Grossman Health Care Model," Southern Economic Journal 65 (April 1999): 791-806.

       Chaloupka, Frank J., "Rational Addictive Behavior and Cigarette Smoking," Journal of Political Economy 99 (1991): 722-742.

       Mauldon, Jane, "The Effect of Marital Disruption on Children's Health," Demography 27 (1990): 431-446.

       Schultz, T. Paul, "Introduction: Symposium on Investments in Women's Human Capital and Development," Journal of Human Resources 28 (1993): 689-693.

 Cost - Benefit Analysis

FGS, 24, then 10

       Russell, Louise B., Educated Guesses: Making Policy About Medical Screening Tests, Berkeley: University of California Press, 1994.

       Goddeeris, John H., and Thomas P. Bronken, "Benefit-Cost Analysis of Screening," Medical Care 23 (1985): 1242-1255.

       Littrup, Peter, Goodman, Allen C., Mettlin, Curtis, "The Benefit and Cost of Prostate Cancer Early Detection," CA – A Cancer Journal for Clinicians 43 (1993): 134-149.

Blomquist, Glenn, “Economics of Value of Life” in the Economics Section edited by Orley Ashenfelter of the International Encyclopedia of the Social and Behavioral Sciences edited by Neil J. Smelser and Paul B. Baltes (New York: Pergamon of Elsevier Science, forthcoming October 2001).

Garber, Alan M. and Phelps, Charles E., "Economic Foundations of Cost-Effectiveness Analysis," Journal of Health Economics 16 (1997): 1-32.

       Meltzer, David., "Accounting for Future Costs in Medical Cost-Effectiveness Analysis," Journal of Health Economics 16 (1997): 33-64.

       Weinstein, Milton C., Manning Willard G., Jr. "Theoretical Issues in Cost-Effectiveness Analysis" Journal of Health Economics 16 (1997): 121-128.

       Phelps, Charles E., and Stephen T. Parente, "Priority Setting in Medical Technology and Medical Practice Assessment," Medical Care 28 (1990): 703-723.

Bala, Mohan V., and Gary A. Zarkin, “Are QALYs an Appropriate Measure for Valuing Morbidity in Acute Diseases?” Health Economics 9 (2000): 177–180.

Insurance and Managed Care

FGS, 7, 11, 12

Shortell, Stephen M., Robin R. Gillies, and David A. Anderson, “The New World of Managed Care: Creating Organized Delivery Systems,” Health Affairs 13 (Winter 1994): 46-64.

Luft, Harold S., “Health Maintenance Organizations and the Rationing of Medical Care,” Milbank Memorial Fund Quarterly/Health and Society 60 (1982): 268-306.

Ellis, Randall P. “Creaming, Skimping and Dumping: Provider Competition on the Intensive and Extensive Margins,” Journal of Health Economics 17 (1998): 537-555.

Goodman, Allen C., and Stano, Miron, “HMOs and Health Externalities: A Local Public Good Perspective,” Public Finance Review 28 (May 2000): 247-269.

Baker, Laurence C., and Kenneth S. Corts, “HMO Market Penetration and the Cost of Health Care: Market Discipline or Market Segmentation,” American Economic Review 86 (1996): 389–394.

Miller, Robert H., and Harold S. Luft, “HMO Plan Performance Update: An Analysis of the Literature: 1997–2001,” Health Affairs 21 (4) (2002): 63–86.

Production, Technology and Cost

       FGS, 5, 11 (Pp. 244-247)

       Shortell, Stephen M., Robin R. Gillies, and David A. Anderson, "The New World of Managed Care: Creating Organized Delivery Systems," Health Affairs 13 (Winter 1994): 46-64.

       Luft, Harold S., "Health Maintenance Organizations and the Rationing of Medical Care," Milbank Memorial Fund Quarterly/Health and Society 60 (1982): 268-306.

       Miller, Robert H., and Harold S. Luft, "Managed Care Plan Performance Since 1980: A Literature Analysis," Journal of the American Medical Association 271 (May 18, 1994): 1512-1519.

       Goodman, Allen C., and Stano, Miron, "HMOs and Health Externalities: A Local Public Good Perspective," Wayne State University, August 1998.

       Jensen, Gail A., and Michael A. Morrisey, "The Role of Physicians in Hospital Production," Review of Economics and Statistics 68 (1986): 432-442.

       Gaynor, Martin, and Mark V. Pauly, "Compensation and Productive Efficiency in Partnerships: Evidence from Medical Group Practice," Journal of Political Economy 98 (1990): 544-573.

       Scitovsky, Anne A., "Changes in the Costs of Treatment of Selected Illnesses, 1971-1981," Medical Care 23 (1985): 1345-1357.

       Goddeeris, John H., "Insurance and Incentives for Innovation in Medical Care," Southern Economic Journal 51 (1984): 530-539.

       Weisbrod, Burton A., "The Health Care Quadrilemma: An Essay on Technological Change, Insurance, Quality of Care, and Cost Containment," Journal of Economic Literature 29 (1991): 523-552.

 Hospitals and Nonprofits

       FGS 13. 14

       Scanlon, William J., "A Theory of the Nursing Home Market," Inquiry 17 (1980):25-41.

       Weisbrod, Burton A., The Nonprofit Economy, Cambridge, MA: Harvard, 1988.

       Holtmann, Alphonse G. and Todd L. Idson, "Wage Determination of Registered Nurses in Proprietary and Nonprofit Nursing Homes," Journal of Human Resources 28 (1993): 55-79.

       Newhouse, Joseph P., "Toward a Theory of Nonprofit Institutions: An Economic Model of a Hospital," American Economic Review 60 (1970): 64-74.

       Pauly, Mark V., and Michael Redisch, "The Not-for-Profit Hospital as a Physician's Cooperative," American Economic Review 63 (1973): 87-100.

       Harris, Jeffrey E., "The Internal Organization of Hospitals: Some Economic Implications," Bell Journal of Economics 8 (1977): 467-482.

Health Policy - Domestic and International

       FGS, 18 - 21

       Mooney, Gavin, et al., "Utilisation as a Measure of Equity: Weighing Heat?" Journal of Health Economics 10 (1991): 475-480.

       van Doorslaer, Eddy, and Adam Wagstaff, "Equity in the Delivery of Health Care: Some International Comparisons," Journal of Health Economics 11 (1992): 389-411.

       Wagstaff, Adam, "QALYs and the Equity-Efficiency Trade-Off," Journal of Health Economics 10 (1991): 21-41.

       Coyte, Peter C., et al., "Waiting Times for Knee-Replacement Surgery in the United States and Ontario," New England Journal of Medicine 331 (1994): 1068-1071.

       Gerdtham, Ulf-G, et al., "An Econometric Analysis of Health Care Expenditure: A Cross-Section Study of the OECD Countries," Journal of Health Economics 11 (1992): 63-84.

       Goodman, Allen C., "New Measurements of Cross-National Income-Expenditure Relationships, Wayne State University, May 1999.

       Pfaff, Martin, "Differences in Health Care Spending Across Countries: Statistical Evidence," Journal of Health Politics, Policy and Law 15 (1990): 1-67.

Altenstetter, Christa, “Health Care in Germany,” prepared for distribution at the series Rekindling Reform:A Vision of Quality Health Care for All, New York, January 10–May 16, 2002, http:web.gc.cuny.edu/Eusc/activities/Paper/altenstetter2.htm.

       Rice, Thomas. The Economics of Health Reconsidered. (Chicago: Health Administration Press, 1998).

        Commission on the Future of Health Care in Canada, Building on Values: The Future of Health Care in Canada—Final Report, www.healthcarecommission.ca/HCC_Final_Report.pdf, accessed December 5, 2002.

Elective Subjects

       Possibilities include Economic Epidemiology, or others, as class prefers

Philipson, Tomas, “Economic Epidemiology and Infectious Diseases,” in Handbook for Health Economics, Volume I, edited by Anthony J. Culyer and Joseph P. Newhouse. (Elsevier Science, B.V., 2000).

       Philipson, Tomas, “Private Vaccination and Public Health: An Empirical Examination for U.S. Measles,” Journal of Human Resources 31 (3) (1996): 611–630.

       Philipson, Tomas, “The Welfare Loss of Disease and the Theory of Taxation,” Journal of Health Economics 14 (1995): 387–395.

       Philipson, Tomas J., and Richard Posner. Private Choices and Public Health:The AIDS Epidemic in Economic Perspective. (Cambridge: Harvard University Press, 1993).