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MEDICAL INSURANCE, TECHNOLOGICAL CHANGE, AND WELFARE
Author(s) -
GODDEERIS JOHN H.
Publication year - 1984
Publication title -
economic inquiry
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.823
H-Index - 72
eISSN - 1465-7295
pISSN - 0095-2583
DOI - 10.1111/j.1465-7295.1984.tb00666.x
Subject(s) - welfare , economics , medical care , constraint (computer aided design) , actuarial science , technological change , health insurance , insurance policy , public economics , microeconomics , health care , medicine , macroeconomics , economic growth , engineering , market economy , mechanical engineering , family medicine
Concerns have been expressed about the welfare effects of expensive innovations in medical care financed largely through medical insurance. This paper develops a model which considers such issues. It is shown that even if insurance is purchased optimally (subject to a plausible constraint on the form of the contract), innovations may be adopted that have the effect of reducing expected welfare. The question of how the benefits of medical innovations ought to be measured in the presence of insurance is also explored.