Examples of trade offs and opportunity costs in health care
Consequently, opportunity cost is the gold standard for defining costs in economic analyses. Rarely can one estimate opportunity costs in health care. Researchers must instead rely on accounting costs or charges. The accounting cost (or production cost) is the combined value of resources used to produce the good. The charge is the amount listed Serious demands to constrain health care costs will only come when we in the body politic come to realize that the opportunity costs of ever more spending on health care are greater than the benefits. Resources used in economic evaluations should be valued at opportunity cost, but doing this is difficult (especially in health care, where there is no perfect market), 5 so unit costs tend to be used instead, based on the costs of the various inputs.