University of South Carolina, Arnold School of Public Health, Dept. of Health Services Policy and Management

Dickie Scruggs, the Mississippi trial lawyer mentioned by Herzlinger, pled guilty in 2008 to attempting to bribe a judge and was sentenced to five years. A New Yorker article gives details.

Governor Palin's closer at the VP candidates' debate was a long paraphrase from Ronald Reagan about freedom being "one generation away from extinction." It was adapted from a recording Reagan made in 1965 for the American Medical Association's campaign against Medicare.

Paul Krugman's blog has good ongoing commentary on the financial crisis and the bailout.

An appalling example of opportunity cost: One in five wounded Iraq War veterans has a family member who quit a job to make time to care for the veteran. http://www.iava.org/

This article in The Onion, Recession-Plagued Nation Demands New Bubble , may prove just as prescient as this one from January 2001: Bush: 'Our Long National Nightmare Of Peace And Prosperity Is Finally Over'
The Onion is satire.

One student found this presentation on hospital pricing reform. Reinhardt's incremental cost article implies that hospital pricing reform could help make our decisions about the venue of care more rational. Save this for now. We'll come back to this in a couple of weeks.

A New England Journal of Medicine article about SCHIP -- Medicaid for children of working families.

 

HSPM J712
Health Economics
Fall 2008

Samuel L. Baker, Ph.D.

Associate Professor
Department of Health Services Policy and Management
Arnold School of Public Health
University of South Carolina
800 Sumter St., Room 121
Columbia, SC 29208
Phone: (803)777-5045  Fax: (803)777-6986  E-mail: 
Please put 712 in the subject line of course-related e-mail. Please use Blackboard, not e-mail, to submit course work.
What you'll need - What you'll do - Schedule of Classes, Readings, and On-Line Materials - Interactive Tutorials

The class meets at 6pm-8:30pm on Wednesdays in Wardlaw room 116. (Map.) Class meetings are televised live to regional campuses and other locations with access to the ETV closed-circuit network.

Office hours: 10:00am-12:00pm and 2:00pm-4:00pm on Wednesdays, or by appointment.

Goals

HSPM J712 introduces the application of economics to decisions regarding the amount, organization, and distribution of health care services in the United States. The goals of the course are:

Learning objectives

You will demonstrate on the course's written assignments and through class participation:
  1. that you understand and can use basic economics concepts, such as supply, demand, marginal analysis, the theory of capital, and cost-benefit analysis,
  2. that you can analyze the economic institutions of the United States health care system,
  3. that you can discuss controversies surrounding the development of health insurance and the government's role in providing, financing, and regulating health services.

What you need to have to take this course

Prerequisite courses: None. No prior study of economics is required for this course.

Required purchase:

Later in the semester, there will be three books to read and a DVD to watch. These are fairly cheap at Amazon.com or other online bookstores.

The books and DVD are:

 Testing Java  If your Java version,  :( If you see this text, Java is not working at all. Go to java.com to download and install it. At some workplaces, you may have to request that Java be enabled for your computer. , is 1.4 or higher, you should be able to do the tutorials. Otherwise, get the latest "Java for your desktop" for free at http://java.com. If you install or update Java, you can uncheck the box for OpenOffice, unless you'd like to try this free alternative to Microsoft Office (Word, Excel, etc.).
If you installed Java and you still don't see the version number, try this.

Interactive instruction: A group of computer-based interactive instructional tutorials is available on the Internet at http://hspm.sph.sc.edu/Courses/Econ/Tutorials.html. The interactive tutorials introduce basic economics concepts, particularly for students with little or no economics background. Your work with the interactive tutorials is not monitored or graded. These tutorials are integrated into the Class Schedule and Readings, as shown below. All of the interactive tutorials are available all semester, so you can use or reuse them at any time.

Required computer access: Students must have access to a computer with:

Computers meeting these requirements are available for student use in the Department's BlueCross BlueShield and Companion Technologies Computer Education Center, on the first floor of the Arnold School of Public Health building. Public libraries and regional campuses may also have computers you can use.
 How to submit written work: 
Blackboard's Assignments feature
Please do not use Blackboard's digital drop box or messages. I do not regularly check those.

Course Work for Credit

Weekly comment:

Good comments can be about:

You learn new concepts by using them. That is the purpose of the comments.

Take-home exams are due on these dates:

Mid-term: Wed., Oct. 15
Final: Sat., Dec. 13

Each exam counts for one-third of the grade.

The exams will be distributed via this web site, or by other method if you request.

Your course grade is one-third the comments, one-third the mid-term exam, and one-third the final exam.

Class Schedule and Readings

Advice for the overwhelmed: If the reading for this course seems like a lot, see How 2 Read an Article.

August 27 Introduction to the Course -- no comment due

How the course will operate, and the general shape of the US health care economic sector.

 Web 

September 3 Cost -- comment due

Learning objectives: Basic cost concepts, the accounting of future costs, methods and ethics of cost-benefit and cost-effectiveness analysis applied to health care.

 Web 

 Blackboard  To find this, go to Blackboard, click this course's link, click on Assignments in the left menu, then click on the folder for this week.
Future Cost and Income
 Web 

September 10 Cost-Benefit, Cost-Effectiveness, and Cost-Savings Analysis comment due

Learning objectives: Methodology and ethics in cost-benefit and cost-effectiveness analysis, with application to evaluating the cost-effectiveness of preventive care, the distinction between cost-effective and cost-saving, and an attempt at policy based on cost-effectiveness analysis. Then, the concepts of market, supply, and demand.

Cost-Benefit Analysis
 Web 

 Blackboard 
Cost-Effectiveness Analysis
 Web 

 Blackboard 

September 17 Health Care on the Market: The Demand for Health Care -- comment due

Learning objectives:  What economists mean by demand; risk and risk aversion, as they relate to insurance; the basic issue of whether a free market in health care can be efficient; moral hazard.

Supply and Demand introduction
 Web 

 Blackboard 

September 24 Health Care Demand II: What's special about health care? comment due

Learning objectives: Insurance concepts, uncertainty in health care choice

 Web 

 Blackboard 

October 1 Health Care Demand III -- comment due. This week's comment can be one or two trial answers to exam questions.

 Blackboard 

These readings show that people do get less health care when they have to pay more. Theory of demand does apply. There is a demand curve for health care generally and there are demand curves for specific types of health care. These demand curves slope down from left to right. To use the jargon, the demand for health care has some elasticity. The elasticity is pretty low, especially for people seeking care for serious symptoms, but it's not 0.

The articles go on to investigate whether people who buy less care, because they have to pay more, are worse off as a result. If the answer is No, then letting people get care without paying out of pocket is wasteful. Or is it? Are all the costs being considered? How good are people at determining what care they can do without?


 Web 

October 8 No class

October 15 First Exam Due

October 15 The Supply Side of Health Care Markets

Actually, for Oct. 15, we will discuss the readings for Sept. 24 and Oct. 1.

Learning objectives: Competition and monopoly theory, how the market sets price and quantity in health care

 Web 

 Blackboard 

October 15 (This material will also be discussed on Oct. 15.) The Supply Side continued comment

Learning objectives: How DRG- and RBRV-based payment work.

 Web 
DRG's -- A tool for controlling hospital prices
 Blackboard 
RBRVS -- A tool for controlling physician fees
 Blackboard 

October 22 Managed Care and Consumer-Driven Health Care as solutions comment due

Who Killed HealthCare?: America's $2 Trillion Medical Problem - and the Consumer-Driven Cure, by Regina Herzlinger

 Web 

Learning objectives:  The history of managed care, results of managed care, managed care and quality.

 Blackboard 

October 29 We'll discuss the readings for Oct. 22

November 5 Pharmaceuticals comment due

Learning objectives: Pharmaceutical prices, research, and sales promotion. The dilemma of how to finance and promote technological advance.

Marcia Angell, The Truth About the Drug Companies: How They Deceive Us and What to Do About It

 Web 

November 12 Administrative Cost and International Comparisons -- comment due

Learning objectives: Understand and evaluate the claim that universal health insurance covers gives more value at less expense.

Health Care Meltdown: Confronting the Myths and Fixing Our Failing System, by Bob Lebow

Administrative Cost
 Blackboard 
International Comparisons
 Web 

November 19, 2008 Sicko, a movie by Michael Moore comment due

 Web 

December 3 Sicko discussion continues comment due

 Web  A Limited Health-Care Success in Massachussetts, American Prospect July 2, 2008.

Nov. 30, 2008, All Things Considered NPR radio report: Mass. Health Care Reform Reveals Doctor Shortage

Would national health insurance stifle innovation?

Dec. 13 Second take-home exam due by end of day.


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