Health care markets may be inefficient because of

Question

Quizplus · Accepted Answer

Poor information, adverse selection, and moral hazard are all factors that can contribute to market inefficiencies in the health care sector. Poor information can make it difficult for patients to make informed decisions, while adverse selection occurs when individuals with higher health care needs are more likely to seek insurance, driving up costs for everyone. Moral hazard refers to the tendency for individuals with insurance to use more health care services than they otherwise would, since they are not bearing the full cost. All of these factors can lead to inefficiencies in the allocation of health care resources, making it difficult to achieve optimal outcomes for patients and society as a whole.

Health Care Markets May Be Inefficient Because of