ABSTRACT

Introduction In order to protect people against the random risk of high medical services expenditures, health insurance of some form is appropriately furnished in all modern societies. However, because of the existence of moral hazard caused by insurance, it is almost equally inevitable that some method will be chosen to limit the quantity of care to an amount less than the provider would recommend and the patient would accept if the care were free of monetary cost at the point of use. Some moderate amount of limitation is provided by retaining some user money price, but in almost all cases the bulk of the burden of limitation is placed on the supply side – through rules, provider incentives, or characteristics of access, care is rationed.