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Hospital demand for physicians.

M A Morrisey1, G A Jensen

  • 1University of Alabama, Birmingham.

The Quarterly Review of Economics and Business
|January 4, 1991
PubMed
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This study models physician demand, considering factors like unobserved costs and physician non-homogeneity. Findings suggest physicians may face reduced hospital access as hospital numbers decline.

Area of Science:

  • Health Economics
  • Hospital Management
  • Physician Workforce Analysis

Background:

  • Understanding the economic factors influencing physician demand is crucial for healthcare policy and hospital administration.
  • Existing models often simplify physician-hospital relationships, failing to account for complexities like unobserved costs and physician mobility.

Purpose of the Study:

  • To develop a generalized derived demand model for physicians that incorporates various hospital objectives (physician control, profit maximization, utility maximization).
  • To analyze the implications of unobserved physician hiring costs, multi-hospital appointments, and physician heterogeneity on demand.
  • To empirically estimate specialty-specific physician demand equations using historical hospital data.

Main Methods:

  • Development of a theoretical derived demand model for physicians.

Related Experiment Videos

  • Estimation of a system of specialty-specific demand equations using 1983 American Hospital Association data.
  • Analysis of the model's consistency with empirical results.

    • Main Results:

    • The empirical results align with the theoretical model's predictions.
    • The study highlights the significance of factors such as unobserved prices and physician non-homogeneity.
    • Evidence suggests a potential for reduced physician access to hospitals.

    Conclusions:

    • Physicians may need to be concerned about diminishing access to hospital facilities.
    • The declining stock of hospitals could exacerbate issues related to physician access.
    • The derived demand model provides a framework for understanding physician-hospital market dynamics.