Demand-based models and market failure in health care: projecting shortages and surpluses in doctors and nurses

27 May 2019

Professor Stephen Birch's paper, titled, Demand-based models and market failure in health care: projecting shortages and surpluses in doctors and nurses, was recently accepted in the Health Economics, Policy and Law publication.

Abstract

Planning the health care workforce is generally based on meeting the expected future demands for health care and assumptions of status quo in the prevalence of health conditions, the services to address those conditions and the way those services are delivered. Only changes the size and age distribution of the population are included in planning.  This fails to recognise that public intervention in health care systems arises from market failure in health care, with the demand for care being partly influenced by the providers of care. As a result, models of demand-based planning perpetuate inefficiencies in the form of overutilisation of services on the one hand and unmet needs for care on the other. In this paper the problems with basing workforce policy on projected demand are identified and the consequences for health care system sustainability explored. Integrated needs-based models are offered as alternative approaches that relate directly to the goals of publicly funded health care systems and represent an important element of promoting sustainability in public health care systems.

View the full paper (PDF, 62 KB)

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