Module Components

• Overview

Topics

• Divergences from a Competitive Market
• The Role of Government When Externalities Occur
• The Importance of Health Policy

NDNP 803 - Executive Leadership and Healthcare Economics

Module 7: The Production of Externalities in Health Care

The Importance of Health Policy

Health policy can be defined as the "decisions, plans, and actions that are undertaken to achieve specific health care goals within a society." According to the World Health Organization, an explicit health policy can achieve several things: it defines a vision for the future; it outlines priorities and the expected roles of different groups; and it builds consensus and informs people.

Health-related policy and its implementation is complex. Conceptual models can help show the flow from health-related policy development to health-related policy and program implementation and to health systems and health outcomes. Policy should be understood as more than a national law or health policy that supports a program or intervention. Operational policies are the rules, regulations, guidelines, and administrative norms that governments use to translate national laws and policies into programs and services. The policy process encompasses decisions made at a national or decentralized level (including funding decisions) that affect whether and how services are delivered. Thus, attention must be paid to policies at multiple levels of the health system and over time to ensure sustainable scale-up. A supportive policy environment will facilitate the scale-up of health interventions.

There are many categories of health policies, including personal health care policy, pharmaceutical policy, and policies related to public health such as vaccination policy, tobacco control policy, or breastfeeding promotion policy. They may cover topics of financing and delivery of health care, access to care, quality of care, and health equity.
 
There are also many topics in the politics and evidence that can influence the decision of a government, private sector business or other group to adopt a specific policy. Evidence-based policy relies on the use of science and rigorous studies such as randomized controlled trials to identify programs and practices capable of improving policy relevant outcomes. Most political debates surround personal health care policies, especially those that seek to reform health care delivery, and can typically be categorized as either philosophical or economic. Philosophical debates center around questions about individual rights, ethics and government authority, while economic topics include how to maximize the efficiency of health care delivery and minimize costs.

The modern concept of health care involves access to medical professionals from various fields as well as medical technology, such as medications and surgical equipment. It also involves access to the latest information and evidence from research, including medical research and health services research.

In many countries it is left to the individual to gain access to health care goods and services by paying for them directly as out-of-pocket expenses, and to private sector players in the medical and pharmaceutical industries to develop research. Planning and production of health human resources is distributed among labor market participants.

Other countries have an explicit policy to ensure and support access for all of its citizens, to fund health research, and to plan for adequate numbers, distribution and quality of health workers to meet health care goals. Many governments around the world have established universal health care, which takes the burden of health care expenses off of private businesses or individuals through pooling of financial risk. There are a variety of arguments for and against universal health care and related health policies. Health care is an important part of health systems and therefore it often accounts for one of the largest areas of spending for both governments and individuals all over the world.

For more information:

Health Care in a Free Market

The Top Three Health Policy Proposals

Health care is more than policy....