While medical care is “different,” standard economic analysis still offers much useful insight and analytic structuring. On the demand side, for example, the “human capital” approach offers a way to move from the demand for “health” to the demand for medical care. On the supply side, we must account for the incentives and motives of not for profit suppliers in some cases. And in the demand for insurance, we must account for the effect of insurance on medical care use in a specific way. What does health economics study specifically? Some people say: “Medical care is so special that normal economic forces don’t apply.” Do you agree?
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