VALUATION OF SUPPLY AND DEMAND - KEY TO PUBLIC HEALTH CARE RESOURCE ALLOCATION

Health care is a component of social infrastructure and thus it is subject to government intervention and administrative decision-making. In addition to being a basic human need, it contributes to numerous economic implications. An effective use of health care prevention programs contributes to a reduction in the use of medical services and the associated high cost of health care. Administrative decision-making is an integral part of the public health care and hence it becomes necessary to explicitly evaluate the costs and benefits of medical interventions, i.e. it is necessary to take into account their cost effectiveness. Since the market equilibrium implies a balance between the supply and demand, our goal is to emphasize the importance and the necessity of not only evaluating the supply side, but also the demand side factors (preferences of the health services users), by using the stated preferences method.