Reference no: EM133640317

Assignment:

Respond to the following questions,

You may use any program to display data, charts, graphs, etc. :

1. An insurance market consists of high-risk patients, who average $40,000 in spending per year, and low-risk patients, who average $1,000 per year. Overall, low-risk patients represent 90 percent of the population. What would average spending be for a population like this?

2. What risk does a health system bear when it agrees to a bundled payment?

3. What risk does a health system bear when it agrees to accept capitation?

4. Should medical services be free? Justify your answer.

5. Your hospital is considering opening a satellite urgent care center about five miles from your main campus. You have been charged with gathering demographic information that might affect the demand for the center's services. What data are likely to be relevant?

6. Your boss has asked you to describe how the demand for an over-the-counter sinus medication would change in the following situations. Assuming the price does not change, forecast whether the sales volume will go up, remain constant, or go down.

a. The local population increases.

b. A wet spring leads to a bumper crop of ragweed.

c. Factory closings lead to a drop in the area's average income.

d. A competing product with a different formula is found to be unsafe.

e. A research study showing that the medication causes severe dizziness is published.

References:

Lee, R. H. (2015). Economics for Healthcare Managers.