This course aims to introduce economic tools for understanding and analysing the health care sector. We will use economic tools to analyse the major participants in the healthcare sector—hospitals, physicians, health insurers, and pharmaceutical firms. We will also investigate how government policies shape healthcare markets and develop skills to assess the effects of these policies using economic approaches.

Topics that we will investigate in depth include: 

1.    Distinctive economic characteristics of ' healthcare' as a commodity; 

2.    Fundamental demand for health: the Grossman's model;

3.    Quality and financial incentive of healthcare providers: the Industrial Organisation perspective;

4.    Private and public health insurance I: Adverse Selection and the Rothschild-Stiglitz model; 

5.    Private and public health insurance II: Ex-ante and ex-post Moral Hazard; 

6.    Health Technology Assessment: Cost-effectiveness analysis and Cost-benefit analysis 

7. Healthcare systems around the world and healthcare reforms: Past, present and future

Learning Outcomes

Upon successful completion, students will have the knowledge and skills to:

1. Analyse the economic characteristics of healthcare markets within their historical, political, and cultural contexts, and evaluate how these factors influence health policy and system design.
2. Apply microeconomic models (e.g. Grossman model, Rothschild–Stiglitz model) to real-world healthcare scenarios, collaboratively exploring diverse stakeholder perspectives and policy implications.
3. Evaluate the roles, incentives, and interactions of hospitals, physicians, insurers, and pharmaceutical companies using economic tools, and propose strategies to address inefficiencies and inequities in the system.
4. Conduct cost-effectiveness and cost-benefit analyses using digital tools and data, and communicate results effectively to both specialist and non-specialist audiences.
5. Critically reflect on the ethical, social, and distributive dimensions of health economic decisions, considering pluralistic viewpoints and the broader societal impacts of policy choices.

Research-Led Teaching

Classical as well as frontier research topics, methodologies, and outcomes in health economics will be introduced along the way. Students will be able to see how results from the models can be applied to analyse real world questions, and what questions remain to answer. The lecturer will present his own research in health economics, and also discuss with students their questions and thoughts that arise from their experience, observation, and study of this course.

Required Resources

“Health Economics”, by Bhattacharya, Hyde, and Tu, Published by Palgrave Macmillan. A request has been put to the ANU Library to have the Ebook available and also to have the book on hold at the Chiefly library. The EBook is also available for purchase at the publisher's website.

Staff Feedback

Students will be given feedback in the following forms in this course:

• Written comments
• Verbal comments
• Feedback to the whole class, to groups, to individuals, focus groups

Student Feedback

ANU is committed to the demonstration of educational excellence and regularly seeks feedback from students. Students are encouraged to offer feedback directly to their Course Convener or through their College and Course representatives (if applicable). The feedback given in these surveys is anonymous and provides the Colleges, University Education Committee and Academic Board with opportunities to recognise excellent teaching, and opportunities for improvement. The Surveys and Evaluation website provides more information on student surveys at ANU and reports on the feedback provided on ANU courses.

Class Schedule

Week/Session	Summary of Activities	Assessment
1	Ch1. Introduction of Health EconomicsCh2. Demand for health care
2	Ch3. Demand for health: The Grossman model
3	Ch5. The labour market for physicians
4	Ch6. The hospital industry
5	Ch7. Demand for insurance	Quiz 1
6	Ch8. Adverse selection: Akerlof’s lemons model
7	Ch9. Adverse selection: the Rothschild-Stiglitz model
8	Ch11. Moral hazard
9	Ch12. Pharmaceuticals and the economics of innovation	Quiz 2
10	Ch14. Health technology assessment: Cost-effectiveness analysis
11	Ch14. Health technology assessment: Cost-benefit analysisHealthcare systems around the world and Healthcare reforms
12	Healthcare systems around the world and Healthcare reforms

Tutorial Registration

ANU utilises MyTimetable to enable students to view the timetable for their enrolled courses, browse, then self-allocate to small teaching activities / tutorials so they can better plan their time. Find out more on the Timetable webpage: https://www.anu.edu.au/students/program-administration/timetabling

Assessment Summary

Assessment task	Value	Due Date	Return of assessment	Learning Outcomes
Quiz	5 %	28/08/2026	28/08/2026	1,2,3,4
Mid-semester Exam	35 %	25/09/2026	09/10/2026	 1,2,3,4
Final Exam	60 %	05/11/2026	09/12/2026	1,2,3,4

* If the Due Date and Return of Assessment date are blank, see the Assessment Tab for specific Assessment Task details

Policies

ANU has educational policies, procedures and guidelines, which are designed to ensure that staff and students are aware of the University’s academic standards, and implement them. Students are expected to have read the Academic Misconduct Rule before the commencement of their course. Other key policies and guidelines include:

• Student Assessment (Coursework) Policy and Procedure
• Special Assessment Consideration Policy and General Information
• Student Surveys and Evaluations
• Deferred Examinations
• Student Complaint Resolution Policy and Procedure

Assessment Requirements

The ANU is using Turnitin to enhance student citation and referencing techniques, and to assess assignment submissions as a component of the University's approach to managing Academic Integrity. For additional information regarding Turnitin please visit the ANU Online website Students may choose not to submit assessment items through Turnitin. In this instance you will be required to submit, alongside the assessment item itself, hard copies of all references included in the assessment item.

Moderation of Assessment

Marks that are allocated during Semester are to be considered provisional until formalised by the College examiners meeting at the end of each Semester. If appropriate, some moderation of marks might be applied prior to final results being released.

Participation

PARTICIPATION: For this course in Semester 2 2025, all the lectures and tutorials will be delivered on campus. Details on the delivery of this course and expectations of student participation will be outlined in further detail on the Canvas course site in the O-week.  

Examination(s)

See Assessment Tasks above.

Assessment Task 1

Quiz

A quiz in the form of multiple choice questions will be given online during the lecture time in Week 5. The quiz will cover course materials taught from Week 1 to Week 3. There will be 3 questions and it will take 20 minutes. The marks will be available prior to Week 6 .The final schedule of the quiz will be announced on the course website in Week 3.

Assessment Task 2

Mid-semester Exam

The mid-semester exam will be held in Week 7 depending on the University's exam schedule, covering course materials from Week 1 to Week 5. The exam will be 2-hour long. It will consist of Multiple Choice Questions and Short Answer Questions. A non-programmable calculator is permitted. More details such as the exam date, time and location will be provided in lecture no later than Week 5.

Assessment Task 3

Final Exam

The final exam will be on-campus, held in the final exam period, and run by the ANU Examinations office. The exam will be 3 hours long. It will consist of Multiple Choice Questions and Short Answer Questions. More details such as the coverage of the exam will be provided in lecture no later than Week 9.

Academic Integrity

Academic integrity is a core part of our culture as a community of scholars. At its heart, academic integrity is about behaving ethically. This means that all members of the community commit to honest and responsible scholarly practice and to upholding these values with respect and fairness. The Australian National University commits to embedding the values of academic integrity in our teaching and learning. We ensure that all members of our community understand how to engage in academic work in ways that are consistent with, and actively support academic integrity. The ANU expects staff and students to uphold high standards of academic integrity and act ethically and honestly, to ensure the quality and value of the qualification that you will graduate with. The University has policies and procedures in place to promote academic integrity and manage academic misconduct. Visit the following Academic honesty & plagiarism website for more information about academic integrity and what the ANU considers academic misconduct. The ANU offers a number of services to assist students with their assignments, examinations, and other learning activities. The Academic Skills and Learning Centre offers a number of workshops and seminars that you may find useful for your studies.

Online Submission

The ANU uses Turnitin to enhance student citation and referencing techniques, and to assess assignment submissions as a component of the University's approach to managing Academic Integrity. While the use of Turnitin is not mandatory, the ANU highly recommends Turnitin is used by both teaching staff and students. For additional information regarding Turnitin please visit the ANU Online website.

Hardcopy Submission

For some forms of assessment (hand written assignments, art works, laboratory notes, etc.) hard copy submission is appropriate when approved by the Associate Dean (Education). Hard copy submissions must utilise the Assignment Cover Sheet. Please keep a copy of tasks completed for your records.

Late Submission

No submission of assessment tasks without an extension after the due date will be permitted. If an assessment task is not submitted by the due date, a mark of 0 will be awarded. OR Late submission of assessment tasks without an extension are penalised at the rate of 5% of the possible marks available per working day or part thereof. Late submission of assessment tasks is not accepted after 10 working days after the due date, or on or after the date specified in the course outline for the return of the assessment item. Late submission is not accepted for take-home examinations.

Referencing Requirements

Accepted academic practice for referencing sources that you use in presentations can be found via the links on the Wattle site, under the file named “ANU and College Policies, Program Information, Student Support Services and Assessment”. Alternatively, you can seek help through the Students Learning Development website.

Extensions and Penalties

Extensions and late submission of assessment pieces are covered by the Student Assessment (Coursework) Policy and Procedure The Course Convener may grant extensions for assessment pieces that are not examinations or take-home examinations. If you need an extension, you must request an extension in writing on or before the due date. If you have documented and appropriate medical evidence that demonstrates you were not able to request an extension on or before the due date, you may be able to request it after the due date.

Privacy Notice

The ANU has made a number of third party, online, databases available for students to use. Use of each online database is conditional on student end users first agreeing to the database licensor’s terms of service and/or privacy policy. Students should read these carefully. In some cases student end users will be required to register an account with the database licensor and submit personal information, including their: first name; last name; ANU email address; and other information. In cases where student end users are asked to submit ‘content’ to a database, such as an assignment or short answers, the database licensor may only use the student’s ‘content’ in accordance with the terms of service — including any (copyright) licence the student grants to the database licensor. Any personal information or content a student submits may be stored by the licensor, potentially offshore, and will be used to process the database service in accordance with the licensors terms of service and/or privacy policy. If any student chooses not to agree to the database licensor’s terms of service or privacy policy, the student will not be able to access and use the database. In these circumstances students should contact their lecturer to enquire about alternative arrangements that are available.

Distribution of grades policy

Academic Quality Assurance Committee monitors the performance of students, including attrition, further study and employment rates and grade distribution, and College reports on quality assurance processes for assessment activities, including alignment with national and international disciplinary and interdisciplinary standards, as well as qualification type learning outcomes. Since first semester 1994, ANU uses a grading scale for all courses. This grading scale is used by all academic areas of the University.

Support for students

The University offers students support through several different services. You may contact the services listed below directly or seek advice from your Course Convener, Student Administrators, or your College and Course representatives (if applicable).

• ANU Health, safety & wellbeing for medical services, counselling, mental health and spiritual support
• ANU Diversity and inclusion for students with a disability or ongoing or chronic illness
• ANU Dean of Students for confidential, impartial advice and help to resolve problems between students and the academic or administrative areas of the University
• ANU Academic Skills and Learning Centre supports you make your own decisions about how you learn and manage your workload.
• ANU Counselling Centre promotes, supports and enhances mental health and wellbeing within the University student community.
• ANUSA supports and represents undergraduate and ANU College students
• PARSA supports and represents postgraduate and research students