5 credits

Students in this course examine the application of economic principles to healthcare managerial decision making regarding the amount, structure, and distribution of healthcare resources and services. Because of the complexity and uncertainty of the healthcare system, as well as the scope of resources consumed by health and health-related organizations, managers must appreciate the economic implications of decisions regarding allocation of resources. Students advance their knowledge of economic principles as reflected in the population demand for health; the demand for healthcare and medical care; the supply of health organizations and practitioners; the role of insurance, moral hazard, and adverse selection; the practice of cost-shifting; the structure, competitive nature, and dynamics of markets; differing objectives of for-profit and nonprofit organizations; variation in consumer access to and utilization of services; roles of uncertainty and information asymmetry; strategies for consumer cost-sharing; and the challenges healthcare organizations face in the pricing, production, allocation, and distribution of health and medical services. Special attention is devoted to understanding how health services differ in a variety of competitive markets.