Economic Tools and Concepts Paper

1440 Words6 Pages
Economic tools and concepts paper
Nadine Ranger
November 29, 2010
James Hamilton
Economic Tools and Concepts Paper One of the most prominent topics in the society today is health care reform and government plays a large role in regulating managed health care systems. A vast difference between movement along and shift in the demand curve for the different health care systems. For instance, the government funds Medicaid and Medicare to provide services to the indigent and disabled population. However, many factors exist that influence the control of health care spending from an economic standpoint. The objective of this paper is to discuss the role of government and the supply and demand curves concept to show the
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The cost for health care varies according to the consumer-patients, health care provider (supplier), and insurance companies (third-party payers) as well as the society. However, the bottom line is obtaining the most from the limited resources available while maintaining quality. Essentially the health care delivery system is a demand-driven industry.
Demand Curve Clearly, The United States health care system is the largest industry in the United States and even the world. Currently, health care represents approximately 14% of the United States gross domestic product (GDP). Health care expenditures continue to grow; for instance, in 2001 the market grew to $1.5 trillion and the growth expectation is that health care cost will reach nearly $2 trillion dollars by 2007 (Torreblanca, Friend & Oasterom). Currently, the government leads the healthcare market so it is crucial and beneficial to healthcare patients to understand the United States health care systems. Medical care is a finite service for monetary compensation and changes in demand may occur because of the absence or presence of health insurance plans. Basic health care coverage is expenditures and reimbursement funded by limited third-party payers such as Medicaid, Medicare, and private insurers (Torreblanca, Friend & Oasterom). Until the early 1990s traditional health insurance plans paid for medical services and the bills were sent to the insurers for
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