Meeting: Tues Thurs 6.10 - 7.30 p.m.  Roessler 66

Office Hours:  Tuesday       2.00-3.30 p.m.
                         Wednesday  2.00-3.30 p.m. 

Teaching Assistants: 
    Cynthia van der Werf Cuadros  SSH 0120  cvanderwerf@ucdavis.edu       
    Office hours: Thursday 9.00 - 11.00 a.m.

Discussion Sections:
    A01: Tuesday 4.10 - 5.00 pm  Olson 106
    A02: Tuesday 5.10 - 6.00 pm  Olson 106

Course Goals:
The course goals are:
(1) Provide a detailed description of the institutional features of the health care market and current trends in this rapidly changing field;
(2) Demonstrate the use and usefulness of analyzing the health care market using economic analysis, particularly microeconomics, and some statistical/mathematical analysis.
Compared to other areas of economics, health economics is complicated by a lack of information (about what health services the consumer needs), great uncertainty (hence insurance) and payment through third-parties (insurance companies) rather than direct payment by the consumer.

Pre-requisites:
Economics 100 (intermediate microeconomics) or consent of instructor.
Mathematics 16A-B: These are a pre-requisite for Economics 100.
Statistics 13: As health involves randomness and uncertainty (hence the need for insurance) I assume you have taken introductory statistics.
The course will go through a number of detailed data analysis examples. It is very helpful to have taken Economics 102 or its equivalent (regression analysis).

Textbook: Required  
Jay Bhattacharya, Timothy Hyde and Peter Tu: Health Economics, First edition, Palgrave MacMillan, 2014.

Three copies of the textbook are on two-hour reserve in Sheilds Library.  

This is the second time I have used this book.
It has changed a bit the topics I teach and their order compared to 132 classes in 2014 and earlier.

Supplementary Material: 
There is no coursepack.
Any supplementary material, including assignments, will be posted at Smartsite.

Some past exams and solutions are at http://cameron.econ.ucdavis.edu/e132/e132.html

COURSE OUTLINE:

A. Introduction and Overview of U.S. Health Market
Class 1.     Bhattacharya Chapter 1 + Supplemental Notes.

B. Demand
Classes 2-3.  Bhattacharya Chs.2-3 + Supplemental Notes (file Grossman.pdf)

C. Economics of Health Insurance
Classes 4-6.   Bhattacharya Chs.7, 8, 9.11-9.12.

***** Class 7  Midterm Exam 1   *****

C. Economics of Health Insurance  (continued)
Classes 8-10.   Bhattacharya Chs.11, 18.

D. Economics of Health Innovation
Classes 11-12.  Bhattacharya Chs.13, 14.

E. Suppliers: Physicians, Hospitals, Pharmaceuticals
Classes 13-14,16.  Bhattacharya Chs. 5, 6, 12.

COURSE GRADING:

Midterm Exam1:   22.5%    Thursday October 15    
Midterm Exam2:   22.5%    Thursday November 12  
Assignments:           10%       Due 6.10 p.m. Tuesdays  October 6, 13; November 3, 10, 24; December 3 (a Thursday).
Final Exam:             45%       Monday December 7  8.30 p.m. - 10.30 p.m.    Comprehensive.

Assignments will be graded satisfactory (2%) or unsatisfactory (0%). Full solutions will be distributed. Satisfactory means a serious attempt to answer at least 80% of the questions. The lowest of the scores on the six assignments is dropped, i.e. no penalty for not handing in one assignment if the other five are graded satisfactory. No credit for late assignments. Academic honesty is required - see below.

Exams are closed book with a mixture of short answer (about two-thirds) and multiple choice (about one-third) questions.
The final exam is comprehensive: about 60% on material up to the second midterm and 40% on the remainder.
FOR EXAMS YOU NEED TO BRING STUDENT PHOTO ID. I WILL DECIDE WHERE TO SEAT YOU. 

Scores are posted at Smartsite. You have one week from when work is first returned in class to raise any questions about grading.
AFTER THE FINAL EXAM IS TAKEN NO CHANGES WILL BE MADE FOR ANY REASON TO ANY SCORES RECORDED ON SMARTSITE.

Course grade is determined by the total score, with weights given above. The assignments are graded on a generous scale (satisfactory or unsatisfactory), so most students will get full credit on the assignment portion. Therefore for most students the course score is determined by scores on the assignments and exams. To indicate your progress I give a grade on each midterm. But the final grade is determined by summing the exam and assignment scores (and not by averaging the grades).

I follow the department grading policy. For upper division courses such as this the GPA is typically 2.7.