Because of scarcity -> there is Opportunity cost (next best use of resource)
Law of (Consumers) Demand - inverse proportional
The law of demand states that, if all other factors remain equal, the higher the price of a good, the less people will demand that good.
The amount of a good that buyers purchase at a higher price is less because as the price of a good goes up, the opportunity cost of buying that good also goes up -> people will avoid buying it.
A, B and C are points on the demand curve. So, at point A, the quantity demanded will be Q1 and the price will be P1, and so on. The demand relationship curve illustrates the negative relationship between price and quantity demanded
Law of (Producers) Supply - directly proportional
Higher the price, the higher the quantity supplied. Producers supply more at a higher price because selling a higher quantity at a higher price increases revenue.
Perfect economy = Equilibrium
When supply and demand are equal. At this point, the allocation of goods is at its most efficient because the amount of goods being supplied is exactly the same as the amount of goods being demanded.
A market economy
Balances supply and demand at the most efficient point
- If supply increases/demand falls, price falls, and suppliers reduce production
- If supply decreases/demand increases, price rises and suppliers increase production
Price = signal
No/imperfect market -> No price signal (e.g. central planned economy)
A market where information is not quickly disclosed to all participants in it and where the matching of buyers and sellers isn't immediate.
- Large supplier
2) Monopsony: A market similar to a monopoly except that a large buyer not seller controls a large proportion of the market and drives the prices down. They had such power buying grapes from growers, that sellers had no choice but to agree to their terms. e.g. PCT purchases
2) Information assymetry
- one party in a transaction has more or superior information compared to another. This often happens in transactions where the seller knows more than the buyer (Patient doesn’t know, thus require agency - e.g. GP
3) Public good: a good that is non-rivalrous and non-excludable.
- Non-rivalry: consumption of the good by one individual does not reduce availability of the good for consumption by others
- Non-excludability that no one can be excluded from using the good
4) Externality: A cost or benefit to someone outside the transaction, for example a change in a hospital might produce an externality in terms of problems local residents have in parking. Pollution is a classic externality.
5) Moral hazard: tendency for people to consume more of something if they don’t have to bear the cost (classic example is claiming under an insurance policy, especially if there is no no-claims bonus)
West midlands SHA -> North staffordshire PCT
Types of economic analysis
- Cost-benefit: monetary value to outcomes.
- Cost-effectiveness: unidimensional index of outcome (e.g. HbA1c in DM)
- Cost-utility: A special case of cost-effectiveness
- Ratio between the cost of intervention and the benefit it produces in terms of the number of years lived in full health. (QALYS)
- Intervention A allows a patient to live for three additional years than if no intervention had taken place, but only with a quality of life weight of 0.6, then the intervention confers 3 * 0.6 = 1.8 QALYs to the patient. If intervention B confers two extra years of life at a quality of life weight of 0.75, then it confers an additional 1.5 QALYs to the patient. The net benefit of intervention A over intervention B is therefore 1.8 - 1.5 = 0.3 QALYs.
Approaches for equity
Fair innings: those who have lived to a certain age have already lived most of their expected lifespan (i.e. have had a 'fair innings') and that priority should be given to those who have not yet lived so long. That is, there is greater duty to prevent the death of the young than the old.
Rawls: A Theory of Justice - All social primary goods and the bases of self-respect - are to be distributed equally unless an unequal distribution of any or all of these goods is to the advantage of the least favored. (i.e. greatest benefit of the least-advantaged members of society)
Rule of rescue: the sense of immediate duty that people feel towards those who present themselves to a health service with a serious condition
Utility maximization: Utility (relative satisfaction) to be maximized within society, aiming for "the greatest happiness for the greatest number of people"
Equity-Efficiency Tradeoff - perceived tradeoff between the equity (financial capital) and efficiency (future efficiency in the goods/services production) of a given economy. This theory asserts that, in order for a nation to become wealthier, it must save its equity. However, these additional savings will hurt the development of more efficient production in the future.
Individuals invest in themselves (through either education or health) to increase their productivity. To undertake these investments, individuals need money.
Health, therefore, is demanded mainly for two reasons, consumption (utilize health) and investment (determines total time available).
Epidemiology: Study of distributions (person, place, time) in health
Proportion: x / x+y
- in this case top is numerator and bottom is DENOMINATOR
Rates are absolute
Embryo up to week 8
Fetus: 20 weeks and onwards viable
Baby: After fetus is born
Perinatal death = a fetus + early neonatal + late neonatal
- Fetus: after 20 weeks (i.e. stillbirth)
- Early neonate: Live-born within 7 days of life
- Late neonate: 7 days - 28 days
Perinatal mortality rate
- the sum of fetal deaths (stillbirths) and neonatal deaths per 1000 births.
Postneonatal (i.e. infant): remaining 11 months of first year or life (i.e. beginning of 2nd months to end of 12th month)Infant mortality rate (time is not important here............)- No. of babies dying <1 year old / No. of live birth per 1000Incidence: ABSOLUTE Risk of developing a new condition within a specified period No. of new cases / Pop. @ riskPrevalence (extent): PROPORTION Total cases in the population/No. of people in the population. It is used as an estimate of how common a condition is within a population over a certain period of time.For a disease that takes long to cure and spread widely in 2003 but arrested in 2003 (e.g. HIV)2002: High incidence and high prevalence2003: Low incidence and high prevalence (many existing cases but not many new ones)Conversely, a disease that is easily transmitted but has a short duration (e.g. cold)2002: High incidence short prevalenceTherefore, incidence is used when talking about diseases of short duration, but prevalence if long-lasting.When studying the etiology of a disease, it is better to analyse incidence (absolute risk)rather than prevalence (proportion) , since prevalence mixes in the duration of a condition, rather than measuring risk.Standardization- Compare health outcomes after controlling age and sex differences between 2 populationsDirect
- (ABSOLUTE) Rate: If Local had same age, sex structure as the standard (EU)
- Used when the local pop. is large enough
Death rates- Not entirely useful Does not account for cause of death: e.g. UK higher than Ireland because older pop.WHO Health gain classification
- Ratio: Observed / Expected
- Used when pop. is small, esp. when direct age/sex standardization is NOT APPROPRIATE because of dissimilar distributions
- Standardized mortality ratio (SMR): Local Observed deaths / Standard Expected death
- An SMR greater than 1.0 indicates that there were "excess deaths" compared to what was expected.
- SMR is a measure of relative risk
Types of health measure- Mortality- Morbidity- Well-being: SF-36General fertility rate: No. of live birth/year/thousand women between 15-44 (fertile yrs)Total fertility rate (TFR): Each women’s expected no. of babies over her lifetime Pre-test probability is the prevalence i.e. (4/20 = 4/16+4), thus is a proportion. (Proportion: x / x+y)Sensitivity: how good the test is at testing present (RULE OUT - high sensitivity test i.e. little/no false negative, all negatives must be true neg.)Proportion that has disease (True pos/ True pos +False neg) i.e. correctly identified with disease / all with diseaseIf no false negative: sensitivty is 1!¾ = 75%Specificity: how good the test is at testing absence (RULE IN - if high specficity and a negative result, means must be it!)Proportion of those that don’t have disease (true negative / Fals pos+true neg)i.e. correct identified w/o disease / those w/o disease15/16If 100 patients known to have a disease were tested, and 43 test positive, then the test has 43% sensitivity. (RULE OUT)If 100 with no disease are tested and 96 return a negative result, then the test has 96% specificity. (RULE IN)More test-related...1) Positive predictive value: How likely s/o with positive test has the conditionThose identified as having disease / all test positivetrue pos / true pos + false pos¾ = 75%2) Negative predictive value: how likely s/o with negative test does not have conditionThose identified correctly w/o disease / all test negativetrue neg / true neg + false negRelationship between prevalence and predictive valueAs prev falls(total cases i.e. true pos + false neg /popln.) e.g. more ppl?- ppv (true pos / true pos + false pos) falls (more likely pos test is false pos)- NPV (true neg / true neg + false neg) is high.As prev increases, ppv increases (more likely pos test is true pos.)Rule in and outTo rule out a diagnosis (i.e. high NPV - true neg / true neg+false neg) use a test with high sensitivity (test identified w/ disease / all w/ disease)- Has least false negative -> highest sensitivity (true pos / true pos + false neg) - most positives would be true pos. If a test has high sensitivity, a negative result suggests the absence of disease!To Rule in a diagnosis (i.e. high PPV - true pos / true pos+false pos): Use test with high specificity (test identified w/o disease / all w/o disease)- a test with least false positives has highest specificity (true negative / true neg+false pos) - most negatives would be true neg. If a test has high specificity, a negative result suggests the presence of disease!If 100 patients known to have a disease were tested, and 43 test positive, then the test has 43% sensitivity. (RULE OUT)- A high sensitive test (true pos / true pos + false neg) , so a negative result should be reassuring (the disease tested for is absent). If 100 with no disease are tested and 96 return a negative result, then the test has 96% specificity. (RULE IN)- A high specific test (true negative / true neg+false pos) will not give a false positive (if it appears positive, it must be a true positive!)A highly SPecific test, when Positive, rules IN disease (SP-P-IN), and a highly 'SeNsitive' test, when Negative rules OUT disease (SN-N-OUT).
- Years to life - living longer
- Life to years - given level of health to get the most out of life (e.g. wheelchair - using public transport
- Health to life - not having disease
100%Sesntivity --------------------------------------------------- 100%SpecificityFramingham score: Risk prediction for heart diseasesWith regards to the test...Did - True positive, false positiveDid not - true negative, false negative
About the test... not the disease!!!!
Green oneFalse negative do not develop (Sensitivity = true pos / true pos+false neg)
Focus on the yellow one!False positive (tested yes but do not have) Do not develop (Specific = true neg / true neg+fals pos)... if
Focus on green oneRose hypothesisShifting BP is better than targeting high BP peopleMajority of disease is due to larger pop. of low moderate risk and only MINORITY due to high risk