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• Lorenz Curve


  A graphical representation of the distribution of income or wealth within a population

  
• Gini coefficient/index


  A numerical representation or measure of income or consumption distribution deviation from equality

  
• Concentration curve

  Plots cumulative percentage of a health variable against cumulative percentage of the population ranked by living standards
• Concentration coefficient/index


  A numerical representation of how much a health attribute is concentrated toward the rich or the poor
• Lorenz Curve in health economics


  Shows proportion of income distribution allocated for the poorest households
• Concentration Curve in health economics

  Assesses degree of income-related inequality in health
• Kakwani Index


  A measure of the progressivity of a social intervention
• Concentration curve components

  • A: Pro-poor socioeconomic inequality
  • B: Area between concentration curve and line of equality
  • C: Line of equality
  • D: Pro-rich socioeconomic inequality
• The concentration curve lies above the diagonal when use is concentrated among the poor
• The concentration curve lies below the diagonal when use is concentrated among the rich
• Lorenz curve for pre-tax income


  Is above the concentration curve for taxes paid

  
• Greater inequality in taxes paid

  Than in pre-tax incomes
• C > G and the Kakwani index has a positive value, implying that the system of health care financing is progressive
• Market failure


  The failure of market to achieve an efficient allocation of resources or to reach social goals
• Market failures can be corrected through government intervention
• Sources of market failures

  • Lack of information
  • Market control
  • Public goods
  • Externalities
• Types of market failure in insurance

  • Loading
  • Adverse Selection
  • Moral Hazard
• Adverse Selection leads to

  • Cream skimming
  • Cream dumping
  • Skimping
  • DRG Creep
• Health insurance premium

  An upfront payment made to keep a health insurance policy active
• Health insurance deductible


  The amount you pay before your insurance kicks in
• Copay


  A fixed cost that an insurance policyholder pays for a specific service
• Coinsurance


  A percentage of the cost of a service
• Loading refers to substantial administrative costs associated with providing insurance
• Risk/experience rated insurance

  Charges a premium that reflects individual risk
• Pooled/community rated insurance


  Charges a premium that reflects average risk in the community
• Adverse effects of risk selection

  • Cream skimming
  • Dumping
  • Skimping
  • DRG creep
• Adverse selection

  A market process where buyers or sellers use private knowledge of risk factors to maximize outcomes
• Community rated coverage can be vulnerable to cream skimming in private markets
• Moral hazard in insurance refers to how having insurance changes people’s incentives and actions
• Ex ante moral hazard

  Actions that increase the risk of illness
• Ex post moral hazard


  An increase in the use of health care
• Health system building blocks

  • Leadership and governance
  • Service delivery
  • Health workforce
  • Health information system
  • Medical products, vaccines and technologies
  • Health system financing
• Health system functions

  • Providing services
  • Generating resources
  • Raising and pooling resources
  • Stewardship
• Goals of health system functions

  • Health
  • Responsiveness
  • Fair financing
• Health system strengthening


  The process of implementing changes to respond better to health challenges
• Health system


  Activities aimed at promoting, restoring, and maintaining health
• Health service


  Any service aimed at improving health or diagnosing, treating, and rehabilitating sick people
• Access (to health services)


  The ease of reaching health services or facilities
• Accessibility (of health services)


  Aspects that enhance the ability to reach a health care practitioner
• Continuity of care


  Provision of services coordinated across levels of care