Economics Tools and Concepts Paper

Economics Tools and Concepts Paper

Economic Tools and Concepts Paper

We are facing a crisis in our health care system with a shortage of primary care physicians to treat the growing population. By 2025, it's projected that the need for primary care physician office visits will increase from 462 million to 565 million from 2008 to 2025 (Petterson et all, 2006). Combine the increase in population, technology allowing a longer life span, and a retirement of baby boomers in the health care system which makes you realize the problem that begins to unfold. Projections identify a shortfall of 12,500 to 31,000 primary care physicians by 2025 (IHS Inc., 2015). As our health care system evolves, and more individuals seek care, the shortage of primary care physicians has become a predominated issue that many are discussing. The supply and demand curve and a cost-effective analysis will be the economical tools and concepts that will be further explored relating to the shortage of primary care physicians.

To understand the supply and demand curves, we must first understand what supply and demand are. Getzen (2007) states "the choices made by buyers constitute demand, whereas the choices made by sellers constitute supply” (p. 23). In this instance, demand relates to visiting a primary care physician and the supply is the number of primary care physicians available. Supply and demand are fundamental concepts in the healthcare market to ensure the organizations that will deliver the service are prepared and aware of the consumer requests. The demand for primary care physicians is a growing concern for our health care system as the supply of primary care physician’s drops, and demands continue to increase. The relationship between supply and demand provides information on the allocation of resources necessary in the market.

There are many debates trying to understand the factors that attribute to the shortage of primary care physicians. Some experts debate that the shortage relates to insufficient number of providers. Others realize the strain on the system is in response to the growth in caring for the insured population as a result of the implementation of the health reform laws. Even others note the shortage is related to increasing the life span and the aging population of physicians that will soon be retiring. Additionally, perspectives dealing with larger out-of-pocket expenses and improved productivity for curing diseases has a potential impact on a decreasing the demand for needed physicians and should be also taken into account when analyzing the situation. The array of factors along with conceptual tools will aid in making the best decisions possible to decrease the shortfall of primary care physicians.

Chart 1 lists the scenarios that are taken into consideration when projecting