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| Preface | |
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| Basic Economic Tools | |
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| Introduction | |
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| The Relevance of Health Economics | |
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| Economic Methods and Examples of Analysis | |
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| Does Economics Apply to Health and Health Care? | |
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| Is Health Care Different? | |
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| New Challenges to Health Economists--Managed Care and Health Care Costs | |
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| Conclusions | |
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| Microeconomic Tools for Health Economics | |
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| Scarcity and the Production Possibilities Frontier | |
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| Practice with Supply and Demand | |
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| Functions and Curves | |
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| Derived Demand | |
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| Consumer Behavior Theory: Ideas Behind the Demand Curve | |
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| Individual and Market Demands | |
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| Elasticities | |
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| Production and Market Supply | |
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| The Firm Supply Curve under Perfect Competition | |
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| Monopoly and Other Market Structures | |
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| Welfare Losses | |
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| The Edgeworth Box | |
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| Conclusions | |
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| Statistical Tools for Health Economics | |
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| Hypothesis Testing | |
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| Difference of Means | |
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| Regression Analysis | |
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| Feature: No Link Between Childhood Cancer and Electromagnetic Fields | |
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| Multiple Regression Analysis | |
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| The Identification Problem | |
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| Discrete Choice Analysis | |
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| Statistical Inference in the Sciences and Social Sciences | |
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| Conclusions | |
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| Cost-Benefit Analysis and Other Tools of Economic Evaluation | |
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| Cost-Benefit Analysis: Basic Principles | |
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| Feature: The Cost of Saving Lives | |
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| The Valuation of Benefits and Costs | |
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| Cost-Benefit Analysis in Health Care | |
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| Cost-Effectiveness Analysis | |
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| Cost-Utility Analysis and QALYs | |
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| Conclusions | |
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| Supply and Demand | |
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| The Production of Health | |
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| The Production Function of Health | |
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| On the Historical Role of Medicine and Health Care | |
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| Feature: Tuberculosis and the Magic Mountain | |
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| The Production of Health in the Modern Day | |
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| Feature: The Length of Life Is Fixed | |
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| On the Role of Schooling | |
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| Conclusions | |
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| Demand for Health Capital | |
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| The Demand for Health | |
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| Labor-Leisure Trade-Offs | |
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| The Investment/Consumption Aspects of Health | |
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| Investment Over Time | |
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| The Demand for Health Capital | |
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| Changes in Equilibrium: Age, Wage, Education, and Uncertainty | |
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| Empirical Analyses Using Grossman's Model | |
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| Feature: Rational Addiction--An Adaptation of the Demand for Health | |
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| An Integrated Framework for the Grossman Model | |
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| Conclusions | |
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| Demand and Supply of Health Insurance | |
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| Risk and Insurance | |
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| The Demand for Insurance | |
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| The Supply of Insurance | |
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| The Case of Moral Hazard | |
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| Feature: "Viatical" Life Insurance Deals Get Tougher | |
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| Health Insurance and the Efficient Allocation of Resources | |
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| Conclusions | |
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| Consumer Choice and Demand | |
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| Applying the Standard Budget Constraint Model | |
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| Two Additional Demand Shifters--Time and Coinsurance | |
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| Issues in Measuring Health Care Demand | |
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| Empirical Measurements of Demand Elasticities | |
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| Impacts of Insurance on Aggregate Expenditures | |
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| Conclusions | |
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| Information | |
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| Asymmetric Information and Agency | |
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| Overview of Information Issues | |
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| Asymmetric Information | |
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| Application of the Lemons Principle: Health Insurance | |
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| The Agency Relationship | |
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| Consumer Information, Prices, and Quality | |
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| Feature: Contingency Fees and Medical Malpractice | |
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| Conclusions | |
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| Feature: Health Plan Report Cards | |
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| Imperfect Information: Supplier-Induced Demand and Small Area Variations | |
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| Supplier-Induced Demand (SID) | |
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| Models of SID | |
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| The Identification Problem | |
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| Evaluation of SID | |
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| Small Area Variations (SAV) | |
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| The Physician Practice Style Hypothesis | |
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| SAV and the Social Cost of Inappropriate Utilization | |
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| Feature: Clinical Decision Making and Patient Preferences | |
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| Evaluation of SAV | |
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| Insurance and Organization of Health Providers | |
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| The Organization of Health Insurance Markets | |
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| Loading Costs and the Behavior of Insurance Firms | |
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| Employer Provision of Health Insurance and the Tax System | |
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| Who Pays for Health Insurance? | |
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| Feature: Who Pays for Health Insurance? | |
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| Employer-Based Health Insurance and Job Mobility | |
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| The Market for Insurance | |
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| The Uninsured--An Analytical Framework | |
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| Conclusions | |
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| Managed Care | |
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| What Is the Organizational Structure? | |
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| What Are the Economic Characteristics? | |
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| The Emergence of Managed Care Plans | |
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| Development and Growth of Managed Care--Why Has It Taken So Long? | |
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| Modeling Managed Care | |
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| Are Managed Care Costs Lower? | |
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| Quality of Care | |
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| Growth in Spending | |
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| Competitive Effects | |
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| Conclusions | |
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| Feature: Drive Through Deliveries--Managed Care and Mandates | |
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| Technology | |
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| The Production and Cost of Health Care | |
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| Substitution between Health Care Inputs | |
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| The Cost Function and Economies of Scale and Scope | |
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| Empirical Cost Function Studies | |
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| The Survival Analysis Approach | |
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| Technical and Allocative Inefficiency | |
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| Conclusions | |
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| Technology | |
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| Technological Change and Costs | |
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| Insurance and the Bias Toward Cost-Increasing Technological Change | |
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| On the Diffusion of New Health Care Technologies | |
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| Conclusions | |
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| Labor | |
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| Labor Markets and Professional Training | |
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| The Importance of Labor in the Health Care Sector | |
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| The Demand for and Supply of Health Care Labor | |
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| The Human Capital Theory of Investment in Education | |
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| Factor Productivity and Substitution among Factors | |
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| Health Manpower Availability | |
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| Manpower Planning and the Meaning of Shortages | |
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| Feature: Workforce Planning Versus the Power of Markets | |
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| Feature: Are Nursing Markets Monopsonistic? | |
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| Conclusions | |
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| The Training and Practice of Physicians | |
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| Medical Education Issues and the Question of Control | |
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| Licensure and Monopoly Rents | |
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| Feature: Market Conditions and Choices Facing New Physicians | |
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| Physician Supply Decisions | |
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| Feature: Price Discrimination by Physicians under a Charity Hypothesis | |
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| Geographic Location of Physicians | |
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| Conclusions | |
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| Hospitals and Nursing Homes | |
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| The Role of Nonprofit Firms | |
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| An Introduction to Nonprofits | |
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| Why Nonprofits Exist and Why They are Prevalent in Health Care | |
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| Models of Nonprofit Hospital Behavior | |
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| The Relative Efficiency of Nonprofits versus For-Profits | |
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| Feature: Why are RNs' Wages Higher in Nonprofit Nursing Homes? | |
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| Conclusions | |
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| Hospitals and Long-Term Care | |
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| Background and Overview of Hospitals | |
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| Hospital Utilization and Costs | |
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| Feature: Game Theory and the Medical Arms Race (MAR) | |
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| Nursing Homes | |
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| Hospice and Home Health | |
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| Conclusions | |
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| Social Insurance | |
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| Equity, Efficiency, and Need | |
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| Efficiency and Competitive Markets | |
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| Deviations From the Competitive Model in the Health Care Sector | |
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| Promoting Competition in the Health Care Sector | |
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| An Economic Efficiency Rationale for Social Programs in Health Care Based on Externalities | |
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| Feature: The Rice Critique | |
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| Need and Need-Based Distributions | |
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| Economic Criticisms of Need-Based Distributions | |
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| Horizontal Equity and Need | |
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| Theories of Social Justice | |
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| Conclusions | |
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| Government Intervention in Health Care Markets | |
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| Economic Rationale for Government Intervention | |
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| Forms of Government Intervention | |
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| Government Involvement in Health Care Markets | |
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| Government Failure | |
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| Competitive Strategies | |
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| Conclusions | |
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| Government Regulation--Principal Regulatory Mechanisms | |
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| Do the Laws of Supply and Demand Apply? | |
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| Monopoly and Regulation | |
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| Objectives of Regulation | |
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| Regulation of the Hospital Sector | |
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| Prospective Payment | |
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| The Theory of Yardstick Competition and DRGs | |
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| Prospective Payment--Recent Evidence | |
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| Who Does the Regulator Represent? | |
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| Antitrust | |
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| Conclusions | |
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| Social Insurance | |
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| Social Insurance Policies and Social Programs | |
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| Historical Roots of Social Insurance | |
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| Medicare and Medicaid in the United States | |
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| Feature: Oregon Medicaid's Doctor-Assisted Suicide | |
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| The Effects of Medicare and Medicaid | |
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| National Health Insurance | |
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| Conclusions | |
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| Comparative Health Care Systems | |
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| Criticisms of the American Health Care System | |
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| Contemporary Health Care Systems | |
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| Feature: OECD Data and Opportunity Costs | |
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| National Health Programs: Three Examples | |
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| The Canadian Health Care System | |
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| Feature: How is Health Care "Rationed" in Canada? | |
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| Differences in Health Care Spending Across Countries | |
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| Conclusions | |
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| Policy Issues and Analyses | |
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| Health Systems Reform | |
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| Health System Reform in International Perspective | |
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| Assuring Access to Care | |
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| Feature: Are People Everywhere in the World Basically the Same? | |
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| Providing Care at Lower Cost | |
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| Conclusions | |
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| The Health Economics of Bads | |
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| The Health Economics of Bads: An Introduction | |
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| Rationales for Public Intervention | |
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| Advertising Restrictions on Cigarettes and Alcohol | |
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| Excise Taxes and Consumption: Cigarettes and Alcohol | |
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| Feature: "Mind If I Smoke?" | |
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| Conclusions | |
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| The Pharmaceutical Industry | |
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| Structure and Regulation | |
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| The Production of Health and Substitutability | |
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| Drug Pricing and Profits | |
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| RandD and Innovation | |
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| Cost Containment | |
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| Conclusion | |
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| Feature: Prilosec and Prozac: Why Cost Containment Is So Difficult | |
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| Glossary | |
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| References | |
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| Name Index | |
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| Subject Index | |