Health Care Insurance and Demand

Health Care Insurance and Demand
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People demand health insurance because they would rather pay a small amount in timed premiums than take the risk of getting sock and end up paying a large medical bill. Economists also encourage the promotion of policies in order to reduce the value of low-value health care that costs more to produce than it is purchased for. It is also viewed that people perceive medical insurance as a source for extra income in case of illness. People base their decisions to purchase or not to purchase medical insurance on the value of services being offered by the insurer. In these cases individuals study available information about the levels of quality offered in health plans by medical insurance providers (Feldstein, 2011). Other factors taken into consideration include the cost, the possibility of customer satisfaction, the geographic coverage and age of the insurance network, and the capability of the insurer to keep up with current trends in information technology.
The demand for insurance is based on the reason why individuals prefer medical insurance as explained above while the demand for medical care is usually based on a relationship between the quantity of medical services and utility. The demand for medical care is influenced by many factors. Expenditures and data for utilization are the main factors that are relied upon to measure demand. Expenditures in the demand for medical care involve physicians, services, drugs, hospitals and other related factors. The demand for insurance is distinct in that individuals do not normally investigate economic factors but instead only purchase pre-defined policies (Dunn, 2013). The demand of insurance is therefore determined by the attractiveness and value of the policy towards the consumer.
According to research, individuals with he...