Elasticity In Healthcare

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Introduction Choosing a career path is a matter of passion for some, circumstances for others, and careful consideration and analysis of the microeconomic climate for Jenny. A career in medicine is a complex decision due to the large investments required upfront. Becoming a doctor requires a 4 year bachelor’s degree, preferably in the sciences and at a prestigious institution. During college, a science heavy course load will take up most to all of one’s free time. Another consideration is the cost of tuition for college, books, and housing. It is important to participate in volunteer activities as well as gain experience in the medical field. Finding time for extracurricular activities will be near impossible during this time as maintaining …show more content…
Hypothetical numbers are used to demonstrate the relationship. If the price of insurance co-pay increases from $10 to $20 to $30, the number of customers with the insurance plan would decrease from 100 customers to 80 customers, to 50 customers. (100-50)/(10-30)= 50/-20= -2.5 One of the biggest determinants of demand for health care is the elasticity demand for health insurance. Health insurance plans vary by co-pays, deductibles, coverage of services, coverage of prescription drugs, and requirements. An increase in copay cost, deductible cost, or decrease in services covered will lead to a decrease in members enrolled in the insurance plan. The decrease in members will then increase the demand for health care services to be covered by that plan. The price elasticity demand for health insurance is -1.8 to -0.1 (RIngel et al, 2005). Vox Day demonstrated how the demand curve looks in response to Obama care in Figure …show more content…
(2014). THE DOCTOR SHORTAGE...REAL? (cover story). Benefits Selling, 12(12), 34-38.
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Day, Vox. (2009). Doctors Orders: Economics of Obamacare. WND, WND.com, http://www.wnd.com/2009/07/105088/
Han, K., Cho, M., Chun, K., (2013). Determinants of Health Care Expenditures and the Contribution of Associated Factors: 16 Cities and Provinces in Korea, 2003-2010. J Prev Med Public Health Nov 2013; 46(6): 300-308 http://www.ncbi.nlm.nih.gov/pmc/articles/PMC3859851/
McRae, I., Butler, J.R.G., (2014) Supply and demand in physician markets: a panel data analysis of GP services in Australia. Int J Health Care Finance Econ 14(3): 269-287 Ringel, J.S., Hosek, S.D., Vollaard, B.A., Mahnovski, S., (2005). The elasticity of Demand for Health Care: A review of the Literature and Its Application to the Military Health System. RAND Health. National Defense Research Institute. 1-15.
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