Free Health Service

the government provides the Public of health care to the residents is free of charge or at low cost. Market refers the medical services through the market mechanism, and it provides that service provider recovers costs through fees and charges. It provided it refers government-subsidized health care services, and a fee to patients approach. In the mode of delivery, the government subsidies for free medical services. The government makes up for it cannot recover the costs, but the government improves the supply of medical services. In addition, government also can give health care services to residents.

The advantages and disadvantages of demand-side path

Subsidies of free service follow the teachings of the market economy. Government subsidies should be given to public medical and health institutions, it should introduce mechanisms for purchasing services. Financial resources will provide direct subsidies to the residents. On behalf of residents to public hospitals, private clinics and hospitals purchase medical services. This approach of the core idea and the introduction of market mechanisms give full play perfectly competitive free market, the three mechanisms - the competition, the price of supply and demand improve the quality of health services and efficiency. In this way, passing through the market price information guides medical institutions to compete and win the market, improving service quality and lower prices. Demand-side subsidies, the superiority is obvious. First, the demand side for residents, the basic medical expenses will be subsidized; financing fairness can be improved health services and improve purchasing power, effective demand. Demand side can be a certain degree of release and satisfaction. There is...

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...First, the lifting of price controls, price decided by the health care market, according to microeconomic theory. Under conditions of free competition, this price could at least ensure that the hospital's normal profits. If the hospital can achieve a normal profit, then the motivation to improve health care costs will disappear. Hospitals must consider its own position in the competition and thus have an incentive to protect their own reputation. Hospitals will also enhance the doctor's professional ethics constraints. At the same time, due to serious illness insurance plan will pay the bulk of medical expenses, insurance companies have enough power to monitor the behavior of a doctor-induced demand. Information asymmetry still exists, but effective monitoring and the establishment of a strong constraint, efficiency will be much higher than the publicly funded system.