The health care system involves the interaction of three main types of agents:

• Consumers/patients
• Health insurers/managed care organizations (public & private)
• Providers of medical goods and services, including
  
  • Physicians
  • Pharmaceutical & medical device companies
  • Hospitals

We will provide a framework for understanding the economic factors underlying the health care system and the interaction of its agents.  For several reasons, standard economic models are not adequate to understand markets for health care.  For example, it is difficult for the consumer/ patient to evaluate the quality of the services received.  Costs are uncertain, and insurance reduces the incentive of the consumer/patient or physician to seek the most economical means of treatment.

We will focus primarily on the structure and economics of health insurance and the demand for health care, pricing of drugs and hospital services, cost-benefit analyses employed by payers and consumers of health care products and services, mechanisms used for paying physicians and its impact on the provision of care, and the role of information in the selection and provision of medical goods and services. 

Frank Lichtenberg

Cain Brothers & Company Professor of Healthcare Management in the Faculty of Business

Frank R. Lichtenberg is Cain Brothers & Company Professor of Healthcare Management in the Faculty of Business Economics at the Columbia University Graduate School of Business; a Research Associate of the National Bureau of Economic Research; and a member of the CESifo Research Network. He received a BA with Honors in History from the University of Chicago and an MA and PhD in Economics...

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