The Market for Medical Ethics

At the core of Kenneth Arrow’s classic 1963 essay on medical uncertainty is a claim that has failed to carry the day among economists. This claim—that physician adherence to an anti-competitive ethic of fidelity to patients and suppression of pecuniary influences on clinical judgment pushes medical markets toward social optimality—has won Arrow near-iconic status among medical ethicists (and many physicians). Yet conventional wisdom among health economists, including several participants in this symposium, holds that this claim is either naïve or outdated. Health economists admire Arrow’s article for its path-breaking analysis of market failures resulting from information asymmetry, uncertainty, and moral hazard. But his suggestion that anticompetitive professional norms can compensate for these market failures is at odds with economists’ more typical treatment of professional norms as monopolistic constraints on contractual possibility. If the goal of health care policy and law is to maximize the social welfare yield from medical spending, consideration of the place of professional ethics norms in health policy requires that we pose three questions. First, how can we distinguish between professional norms that enhance social welfare (even if “anticompetitive” in some sense) and therefore merit our deference (and perhaps even some legal protection) and norms that reduce welfare? Second, when we conclude that a professional norm is socially undesirable, how should we go about choosing among regulatory and legal strategies and deference to markets as means for dissolving the norm? Third, when we conclude that a professional norm is socially desirable, how should we go about preserving it? Should we defer to market outcomes—and perhaps shield select forms of professional collusion from antitrust intervention? Or should we defend this norm actively, through legal and regulatory intervention? This essay focuses on the first of these three questions, since it is the subject of Arrow’s article. From a public policy perspective, however, the second and third are just as important. It is hardly obvious that a socially undesirable norm should be targeted by judges or regulators rather than left to wither in the marketplace; nor is it clear that a socially desirable norm needs legal or regulatory support to survive

On-Farm Food Safety and Environmental Farm Plans: A Conceptual Framework for Identifying and Classifying Benefits and Costs

This series of six reports entitled: "On-Farm Food Safety and Environmental Farm Plans: Identifying and Classifying Benefits and Costs" was initiated soon after the launch of the Agricultural Policy Framework (APF) in 2002. The APF recognized the importance of food safety and environmental concerns for the future growth of the agriculture and Agri-food sector. For this reason, Agriculture and Agri-Food Canada (AAFC) commissioned this series of reports to develop a conceptual framework to strengthen our understanding of the potential benefit and cost implications of On-farm Food Safety (OFFS) and Environmental Farm Plans (EFP) that were key components of the APF. The reports were prepared by a group of academics with extensive knowledge of the agriculture and Agri-food sector and issues related to food safety, traceability and the environment. The first report presents a summary of the findings in the five main reports in the series. The second report presents the conceptual framework that was developed to help identify qualitatively the potential benefits and costs that the various players in the agriculture and agri-food supply chain would face in implementing OFFS and EFP programs. The third report applies this framework to pork, the fourth, to beef, the fifth, to grains and the sixth, to dairy. In general, benefits and costs are divided into both demand and supply side effects. In addition, both public and private costs and benefits are considered, especially since they help indicate where a role for government might be required and where markets are not working as well as they might. Based on these preliminary qualitative assessments, the beef and pork sector have more to gain from HACCP-based OFFS and EFP initiatives, due to their ability to gain market share from marketing their products internationally, while the grains sector already benefits internationally from its high quality reputation and the dairy sector is restricted to produce only for the domestic market. However, more work is required in these areas to validate and quantify costs and benefits.Agribusiness, Agricultural and Food Policy, Environmental Economics and Policy, Food Consumption/Nutrition/Food Safety, Production Economics, Resource /Energy Economics and Policy,

Rights Talk and Patient Subjectivity: The Role of Autonomy, Equality and Participation Norms

Patients themselves have transformed the role of the patient in the health care system, making it far more complex than it ever has been before. As a result, the conceptual root of our contemporary understandings of “patient” is an assumption of autonomous subjectivity, i.e., of an individual aware of and capable of acting on her choices for medical care. The Symposium on Patient-Centered Health Law and Ethics of which this Article is a part considers the most recent stage in this evolution of meanings: the concept of patient-centeredness, with its implication of provider deference to the patient’s perspective. Throughout the process of an evolving patient identity, law has played a central constitutive role. In the 1960s and 1970s, the law of informed consent brought the concept of patient autonomy into the constellation of metanorms shaping the idealized doctor-patient relationship. From that process, the patient as a rights-bearing subject emerged. From the 1970s to the 1990s, women’s health advocates and AIDS patients brought a new level of militancy to the patient role, undertaking representation on their own behalf and on behalf of future patients with the same disease. Their efforts produced lasting legal changes in such fundamental medical endeavors as clinical research. In the last two decades, the rise of managed care and the growing shift of financial burdens and risk onto the patient have been reflected in the model of patient as consumer, market actor, and self-insurer – a change also inscribed by and into law. As health law and policy scholars increasingly focus on patient-centeredness, these new patient identities provide a starting point for understanding just who the patient at the center is, what her roles will be in the health-care system as a whole, and what her reasonable expectations of that system will encompass

Trust and Betrayal in the Medical Marketplace

The author argues in this Comment that disingenuity as first resort is an unwise approach to the conflict between our ex ante and our later, illness-endangered selves. Not only does rationing by tacit deceit raise a host of moral problems, it will not work, over the long haul, because markets reward deceit\u27s unmasking. The honesty about clinical limit-setting that some bioethicists urge may not be fully within our reach. But more candor is possible than we now achieve, and the more conscious we are about decisions to impose limits, the more inclined we will be to accept them without experiencing betrayal

Information-Driven Housing

This paper suggests a new information-driven framework is needed to help consumers evaluate the sustainability of their housing options. The paper provides an outline of this new framework and how it would work

Vertical relationships between health insurers and healthcare providers

The current institutional reforms in the Dutch healthcare sector may increase the extent of vertical relations (such as vertical contracts and vertical integration) between insurers and healthcare providers. Vertical relations may have both welfare increasing and welfare reducing effects. In this study, we focus on the latter, in particular on anticompetitive foreclosure. We distinguish three possible mechanisms that may lead to anticompetitive foreclosure, called respectively 'exclusivity', 'sabotage', and the 'waterbed effect'. We discuss under which conditions they come into play and which policy measures can prevent them.

Behavioral Economics and Health Economics

The health sector is filled with institutions and decision-making circumstances that create friction in markets and cognitive errors by decision makers. This paper examines the potential contributions to health economics of the ideas of behavioral economics. The discussion presented here focuses on the economics of doctor-patient interactions and some aspects of quality of care. It also touches on issues related to insurance and the demand for health care. The paper argues that long standing research impasses may be aided by applying concepts from behavioral economics.

Traceability -- A Literature Review

In light of recent food safety crises and international trade concerns associated with food or animal associated diseases, traceability has once again become important in the minds of public policymakers, business decision makers, consumers and special interest groups. This study reviews studies on traceability, government regulation and consumer behaviour, provide case studies of current traceability systems and a rough breakdown of various costs and benefits of traceability. This report aims to identify gaps that may currently exist in the literature on traceability in the domestic beef supply chain, as well as provide possible directions for future research into said issue. Three main conclusions can be drawn from this study. First, there is a lack of a common definition of traceability. Hence identifying similarities and differences across studies becomes difficult if not impossible. To this end, this study adopts CFIA’s definition of traceability. This definition has been adopted by numerous other agencies including the EU’s official definition of traceability however it may or may not be acceptable from the perspective of major Canadian beef and cattle trade partners. Second, the studies reviewed in this report address one or more of five key objectives; the impact of changing consumer behaviour on market participants, suppliers incentive to adopt or participate in traceability, impact of regulatory changes, supplier response to crisis and technical description of traceability systems. Drawing from the insights from the consumer studies, it seems as if consumers do not value traceability per se, traceability is a means for consumers to receive validation of another production or process attribute that they are interested in. Moreover, supply chain improvement, food safety control and accessing foreign market segments are strong incentives for primary producers and processors to participate in programs with traceability features. However the objectives addressed by the studies reviewed in this paper are not necessarily the objectives that are of most immediate relevance to decision makers about appropriate traceability standards to recommend, require, subsidize etc. In many cases the research objectives of previous work have been extremely narrow creating a body of literature that is incomplete in certain key areas. Third, case studies of existing traceability systems in Australia, the UK, Scotland, Brazil and Uruguay indicate that the pattern of development varies widely across sectors and regions. In summary, a traceability system by itself cannot provide value-added for all participants in the industry; it is merely a protocol for documenting and sharing information. Value is added to participants in the marketing chain through traceability in the form of reduced transactions costs in the case of a food safety incident and through the ability to shift liability. To ensure consumer benefit and have premiums returned to primary producers the type of information that consumers value is an important issue for future research. A successful program that peaks consumer interest and can enhance their eating experience can generate economic benefits to all sectors in the beef industry. International market access will increasingly require traceability in the marketing system in order to satisfy trade restrictions in the case of animal diseases and country of origin labelling, to name only a few examples. Designing appropriate traceability protocols industry wide is therefore becoming very important.traceability, institutions, Canada, consumer behaviour, producer behaviour, supply chain, Agricultural and Food Policy, Consumer/Household Economics, Food Consumption/Nutrition/Food Safety, Health Economics and Policy, International Relations/Trade, Livestock Production/Industries, Marketing, Production Economics, D020, D100, D200, Q100,

Theoretical insights into the development of health insurance in low-income countries

This Discussion Paper is concerned with the development of risk-sharing systems for health, in low- and middle-income countries. It questions whether insurance theory developed in wealthier economies, in particular the central ideas of adverse selection and moral hazard, has relevance in the context of poorer countries with high levels of unmet health needs, and low utilisation of health services. Empirical evidence on these two issues is reviewed, as is the debate around social capital and collective action, and its relevance to extending risk sharing in poorer countries. Drawing on thinking and evidence from development economics, it is argued that informal risksharing may crowd-out formal risk-sharing schemes, the reverse of arguments found in much of the literature. Rooted in a holistic framework of household risk-reducing strategies, the paper considers the dynamic of demand for insurance in poorer countries, influenced by factors such as social cohesion, perceived corruption, and duty to the state. A central argument in the paper is that much of the literature on health insurance in low-income countries fails to consider well-developed and highly relevant bodies of literature in development economics and sociology.health insurance

Health Insurance: A Primer

This report provides information related to health insurance. The content includes what it is, why is it needed, health insurance regulation, and how are private health benefits delivered and financed