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Market failure, policy failure and other distortions in chronic disease markets

Watts, Jennifer J. and Segal, Leonie 2009, Market failure, policy failure and other distortions in chronic disease markets, BMC health services research, vol. 9, Article number 102, pp. 1-6, doi: 10.1186/1472-6963-9-102.

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Title Market failure, policy failure and other distortions in chronic disease markets
Author(s) Watts, Jennifer J.ORCID iD for Watts, Jennifer J. orcid.org/0000-0001-8095-8638
Segal, Leonie
Journal name BMC health services research
Volume number 9
Season Article number 102
Start page 1
End page 6
Total pages 6
Publisher BioMed Central
Place of publication London, England
Publication date 2009
ISSN 1472-6963
Keyword(s) market failure
policy failure
chronic disease markets
Summary Background: The increasing prevalence of chronic disease represents a significant burden on most health systems. This paper explores the market failures and policy failures that exist in the management of chronic diseases.
Discussion: There are many sources of market failure in health care that undermine the efficiency of chronic disease management. These include incomplete information as well as information asymmetry between providers and consumers, the effect of externalities on consumer behaviour, and the divergence between social and private time preference rates. This has seen government and policy interventions to address both market failures and distributional issues resulting from the inability of private markets to reach an efficient and equitable distribution of resources. However, these have introduced a series of policy failures such as distorted re-imbursement arrangements across modalities and delivery settings.
Summary: The paper concludes that market failure resulting from a preference of individuals for 'immediate gratification' in the form of health care and disease management, rather than preventative services, where the benefits are delayed, has a major impact on achieving an efficient allocation of resources in markets for the management of chronic diseases. This distortion is compounded by government health policy that tends to favour medical and pharmaceutical interventions further contributing to distortions in the allocation of resources and inefficiencies in the management of chronic disease.
Language eng
DOI 10.1186/1472-6963-9-102
Field of Research 119999 Medical and Health Sciences not elsewhere classified
Socio Economic Objective 970111 Expanding Knowledge in the Medical and Health Sciences
HERDC Research category C1.1 Refereed article in a scholarly journal
Copyright notice ©2009, BioMed Central
Persistent URL http://hdl.handle.net/10536/DRO/DU:30054608

Document type: Journal Article
Collections: School of Health and Social Development
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Every reasonable effort has been made to ensure that permission has been obtained for items included in DRO. If you believe that your rights have been infringed by this repository, please contact drosupport@deakin.edu.au.