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Government's Role in Healthcare Essay

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Table of Contents
1. Introduction………………………………………………………………………….....12
2. Externalities………………………………………………………………………..…..13
3. Asymmetric Information………………………………………………………………..15
4. Government’s role in correcting Market Failures……………………………………15
5. Government’s role in Health Care………………………………………………….…16
6. Government Expenditure and Redistribution………………………………………..16
7. Conclusion……………………………………………………………………………….17
8. Reference……………………………………………………………………………..…18

1. Introduction
I would believe that health care should be viewed as a public good because these goods are non-rival in that consumption of the public health policy by one individual does not reduce the potential for others to consume the goods. The amount consumed by …show more content…

Government has the power to influence any number of aspects of health care strongly. It can, for instance, control the number of providers as well as the kinds of services they deliver; set prices and the types and even quality of services that can be provided, particularly when public resources are involved; and have a strong influence on the introduction and diffusion of new products and technologies. One of the most important roles of government is the collecting of taxes, using the revenues to support further regulation of the sector, as well as to finance the distribution of services to those it deems most fit to receive them most notably the poor, the elderly and veterans (Phelps, 1995).

2. Externalities
For the vast majority of goods and services, including many personal health services, the benefit from consumption accrues exclusively to the individual consuming the good or service and his or her family. However, for an important subset of health care services, the benefits of consumption extend beyond the household. These externalities in consumption have important implications for how health care is financed and produced. When making private decisions, consumers may not consider the effects of their consumption decisions on others. This may be true in deciding whether or not to obtain a vaccination to prevent infectious disease pure health externalities for

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