Doctors! and GDP

In economics we study the choices that people in society make. The topics of supply and demand are the building blocks of any economy. In this paper’s main focus is in elasticity. Elasticity is the reaction of the quantity purchased of an item to changes in the item’s price. If the quantity purchased changes proportionately more than the price, the demand is elastic. If the quantity purchased changes proportionately less than the price, the demand is inelastic. An example is when the price is increased by cigarette manufacturers; it has a relatively small effect on cigarette consumption. It will take a large change in price to affect the quantity consumed. This in fact makes the demand of cigarettes inelastic. Another thing, in the United States, that is inelastic is health-care.

According to the National Coalition of Health care (NCHC) heath care spending is on the raise. In 2003 , the NCHC states that health care spending in the United States reached $1.7 trillion, and was projected to reach $1.8 trillion by 2004. NCHC also stated that in 2003, the United States spent 15.3 percent of its Gross Domestic Product (GDP) on health care. They also predict that the percentage will reach 18.7 percent in 10 years. The fact that health care expenses have increased percentage of GDP implies even greater upward pressure on the demand for physicians’ services.

As the years go by the shortage will worsen as baby boomers reach retirement age and demand more medical care. To expand physician supply, there must be an increase in the number medical positions. There also need to be an increase in medical students. This can be done by increasing class sizes or by building new medical schools. In an article in USA today – it states that the country needs to train 3,000 to 10,000 more physicians a year – up from the current 25,000 – to meet the growing medical needs of an aging, wealthy nation, the studies say. Since it takes ten years or more to train a doctor, the nation will have a shortage of 85,000 to 200,000 doctors in 2020 unless action is taken soon. Becoming a doctor is no easy processes; students spend four years in medical school. Graduates then spend three to seven years training as residents, usually treating patients under supervision at a hospital. With this new shortage in doctors, it has come to my attention that there will be more people per doctor; this causes inelasticity in demand for doctors. With fewer doctors, fees will increase, because with the limited amount of working house, he/she wouldn’t be able to see all his patients. However, people will still have a great demand for them.

The government has a great impact on the shortage of doctors. With government medical aid some doctors don’t get paid as much as they would, thus, making a job as a doctor undesirable. However there are certain people that cannot afford to pay for their own medical bills and need government aid. This entire subject of health care is a very hard and complicated situation that has been discussed in many political elections and has yet been solved.
Due to an inelastic supply and the ever increasing demand for doctors, the cost for medical treatment will keep getting higher and will slowly eat up GDP