1. QALYs
    Quality adjusted life years, which is the time spent in a health state (for a particular disease with specific symptom severity) multipled b the utility score of that state.
  2. Rate of return to aprofessional education
    Is calculated by estimating the costs of an investment in a medical education, including both explicit and implicit (opportunity) costs and the expected higher financial returns as a result of that investment. More precisely, the internal rate of return is that discount rate which, when applied to the future earnings stream, will make its present value equal to the cost of the investment in a medical education.
  3. Rational behavior
    assumes that the decision-maker chooses that course of action offering the highest ratio of marginal benefits to marginal costs.
  4. Redistribution
    Is based on society's value judgement that those with higher incomes should be taxed to provide for those with lower incomes.
  5. Refundable tax credits
    A proposal for national health insurance under which individuals are given a tax credit to purchase health insurance. The tax credit may be income realted, i.e. declining at higher levels of income. Persons whose tax credit exceeded their tax liabilities would receive a refund for the difference. For those with little or no tax liability, the tax credit is essentially a voucher for a health plan.
  6. Regressive taxes
    When those with lower incomes pay a higher portion of their income for that tax than do those with higher incomes.
  7. Report Cards
    Standardized data representing both process and outcome measures of quality and is collected by independent organizations to enable purchasers to make more informed choices of health plans and their participating providers.
  8. Rescource-based relative value scale (RBRVS)
    The current Medicare fee-for-service payment system for physicians, initiated in 1992, under which each physician service is assigned a relative value based on the presumed resource costs of performing that service. The relative value for each service is then multiplied by a conversion factor (in dollars) to arrive at the physician's fee
  9. Risk-adjusted premiums
    The employer adjusts the insurance premium to reflect the risk levels of the employees enrolled with different insurers.
  10. Risk aversion
    Preferring an assured outcome to a more risky alternative
  11. Risk pool
    Represents a population group that is defined by its expected claim experience
  12. Risk selection
    Occurs when insurers attempt to attract a more favorable risk group that the average risk group, which was the basis for the group's premium (preferred risk selection). Similarly, enrollees may seek to join a health plan at a premium that reflects a lower level of risk than their own (adverse selection)
  13. "Rule of reason"
    Used in anti-trust cases to determine whether the anti-competitive harm caused by a particular activity (e.g., merger) exceeds the procompetitive benefits of not permitting the particular activity
  14. Scarce resources
    A basic assumption underlying economic analysis that there are insufficient resources, i.e., time or money, to satisfy all wants
  15. Second opinion
    A utilization review approach in which decisions to initiate a medical intervention are typically reviewed by two physicians
  16. Self funding self-insurance
    A health care program in which employers fund benfit plans from their own resources without purchasing insurance. Self-funded plans may be self-administered, or the employer may contract with an outside administrator for an administrative service only (ASO) arrangement. Employers who self-fund can limit their liability via stop-loss insurance.
  17. Shadow pricing
    A practice previously engaged in by HMOs to set their premiums just below those charged by traditional insurers
  18. Sherman Antitrust Act
    Antitrust legislation established in 1890 to prevent anti-competitive behavior
  19. Shift in Supply
    Caused by changes in input prices, and or a technology which would change the marginal productivity of inputs
  20. Single payer
    A form of national health insurance in which a single third-party payer, usually government, pays the health care providers and the entire population has free choice of all providers at zero (or little) out-of-pocket expense
  21. Skilled Nursing Facility (SNF)
    A long-term care facility that provides inpatient skilled nursing care and rehabilitation services
  22. Specialty HMOs
    A type of HMO that offers one or more limited health care benefits, such as pharmacy, vision, and dental.
  23. Specialty PPOs
    A type of PPO that offers one or more limited health care services or benefits, such as anesthesia, vision, and dental services
  24. Staff-model health maintenance organization
    A type of HMO that hires salaried physicians to provide health care services on an exclusive basis to the HMO's enrollees.
  25. Static economic shortage
    A situation in which demand exceeds supply at the market price. May occur because price is set below the equlibrium level by government or because of barriers to entry. In the case of entry barriers, the market price or wage is greater than if the entry were permitted; the effect is to cause those in the industry to earn excess profits, which is an indication of a long-run shortage.
  26. Stop-loss insurance
    Insurance coverage providing protection from losses resulting from claims greater than a specific dollar amount (equivalent to a large deductible)
  27. Structural quality measures
    Measuresof the quality of care that focus on the context of the environment within which medical services are provided. At the institutional level these measures can include facility licensure, compliance with health and safety codes, and medical staff appointments.
  28. Sunk Costs
    Costs that have already been incurred and should be ignored for economic decision-making.
  29. Supplier induced demand
    When physicians modify their diagnosis and treatment to favorably affect their own economic wellbeing.
  30. Supply and demand analysis
    Used for predicting new equilibrium situations; for example, predicting the effect of a change in demand for a service or inits cost of production on the price and quantity of that service
  31. Surplus
    When the quantity supplied exceeds the quantity demanded at the market price. With respect to health professionals, a surplus occurs when the profession, on average, earns below -normal rate of return
  32. Survivor analysis
    An approach for estimating economies of scale by examining the size distribution of firms in an industry to determine which size of firms become more numerous
  33. Target income hypothesis
    A model of supplier-induced demand that assumes physicians will induce demand only to the extent they will achieve a target income, which is determined by the local income distribution, particularly with respect to the relative incomes of other physicians and professionals in the area.
  34. Task licensure
    Task or specific purpose licenses would recognize that physicians are not always qualified to do all the tasks for which they are licensed to perform. Task licensure would ensure that only those qualified for a particular task would be permitted to perform that task.
  35. Tax Equity and Fiscal Responsibility Act of 1982 (TERFA)
    Legislation that set limits on Medicare reimbusements on per-case basis for hospital costs (DRGs) and limited the annual rates of increase in DRG payments.
  36. Tax-exempt employer-paid health insurance
    Health insurance purchased by the mployer on behalf of their employees is not considered to be taxable income to the employee. By lowering the price of insurance, the quantity demanded is increased (as well as its comprehensiveness). The major beneficiaries are those who are in higher income tax brackets.
  37. Technical efficiency
    The inputs used in a production function produce the maximum output for a given time period.
  38. Tertiary Care
    This type of care includes the most complex services such as transplantation, open heart surgery, and burn treatment, provided in inpatient hospital settings.
  39. Third-party administrator (TPA)
    An independent entity that provides administrative services such as the processing of claims to a company that self insures. A TPA does not underwrite the risk.
  40. Third-party payer
    An organization, such as an HMO, insurance company or government agency, that pays for all or part of the insured's medical services.
  41. Triple option health plan
    A type of health plan in which employees may choose from an HMO, PPO, or indemnity plan, depending on how much they are willing to contribute
  42. Uncompensated care
    Services rendered by the provider without reimbursement, as in the case of charity care and bad debts
  43. Universal coverage
    When the entire population is eligible for medical services or health insurance
  44. Usual, customary and reasonable fees (UCR)
    A method of reimbursement in which the fee is 'usual' in that physician's office, 'customary' in that community, and 'reasonable' in terms of the distribution of all physician charges for that service in the community
  45. Utility maximizing model of hospital behavior
    The non-profit hospital's pricing and investment policies are assumed to be undertaken for the purpose of maximizing the utility of the hospitals decision makers, namely, the management and trustees of the hospital. These decision-makers prefer a large, high quality, prestigious insitution.
  46. Utilization Review Organization (URO)
    An organization that conducts utilization reviews to determine whether specific health care service(s) are medically necessary and delivered at an appropriate cost and quality. These organizations provide their services to various health plans, employers, and insurers.
  47. Vacancy rates
    The percentage of a hospital's budgeted registered nursing positions that are unfilled
  48. Value judgement of minimum provision
    A value judgement underlying national health insurance in which all persons should receive a minimum quantity of medical services
  49. Vertical Integration
    The organization of a delivery system that provides an entire range of services, to include inpatient care, ambulatory care clinics, outpatient surgery and home care
  50. Vertical merger
    A merger between two firms that have a supplier-buyer relationship
  51. Virtual integration
    The organization of a delivery system which relies upon contractual relationships rather than complete ownership to provide all medical services required by the patient
  52. Voluntary performance standard
    An expenditure target adopted by the medicare program to limit the rate of increase its expenditures for physician's services
  53. Welfare criteria
    Economies relies on a set of welfare criteria to determine whether someone is made better or worse off as a result of a policy change.
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