By Ricardo A. Bitran
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Extra info for A supply-demand model of health care financing with an application to Zaire: a training tool
The demand by the insured people is computed similarly, although a lower out-of-pocket price, the copayment, is entered as the health center price. Thus, at the same household income level, the demand for health center care by an insured person will be greater than that of someone without health insurance, as shown in figure 3-3. Finally, demand by the nonpaying is assumed to be rationed by the health center personnel (for example, through longer waiting time) to a level equal to that of the paying, on a per capita basis (see figure 3-4).
12. Normal goods are those that are demanded in greater quantity as people's incomes increase. 13. For example, see Dor, Gertler, and van der Gaag 1987. 14. Some may argue that a greater distance may not necessarily translate into a higher travel time because more distant consumers choose faster means of transportation. While that is possible, it is assumed here that people's travel speed is constant regardless of their location. Hence a greater distance is assumed to result in a longer travel time.
Pn*)s, for s = 1 to S. To illustrate the practical relevance of this discussion, consider the example of a facility that chooses to price preventive services slightly below average cost to promote consumption of preventive care (because of positive externalities or misinformation about consumption benefits) and that, to compensate for this subsidy while breaking even, it prices curative services above average cost. This same facility could also break even by providing preventive services at no charge while charging prices much higher than average cost for curative care.
A supply-demand model of health care financing with an application to Zaire: a training tool by Ricardo A. Bitran