Medical Workforce

Question 0

What happens in the short run when prices will increase?

Answer 0

the demand for physicians shifts from D0 to D1.9 Wages and the quantity of hours will rise in the short run to W1 and Q1, respectively. More college graduates will enter medicine now that ΔY has increased.

Question 1

Explain and draw the demand curve for short run and long run supply for medical labor

Answer 1

Tekening 1: Short-run aggregate labor supply (SSR), will be steeper than long-run aggregate labor supply (SLR) .

If the physician wage increases, more hours will be supplied in the short run as physicians who are already trained and practicing in a market decide to work longer hours.4

The long- run increase in hours will be greater as college graduates increasingly choose medicine over other professions and experienced physicians relocate to high-wage markets. The size and specialty mix of the physician workforce changes slowly over time because the flow of newly trained physicians from residency training is small relative to the stock of physicians.

In practice long-run supply may be dictated by the availability of medical school positions rather than student choices because it is one implication of government regulation.

Question 2

What happens in the long run and why ?

Answer 2

As supply will increase substantially in the long run, creating a surplus of physicians, a subsequent reduction of the flow of students into medicine as the wage falls, and endless cycles of surpluses and shortages .

medical students in the US anticipate future earnings changes when forming their own income expectations during the fourth year of medical school.

Question 3

Will Labor surpluses and shortages be self-correcting in efficient labor markets, why ?

Answer 3

If physicians are willing to supply more hours than firms are willing to hire at the prevailing wage, wages and physician incomes should fall.

As the occupation becomes less attractive and fewer college graduates enter medicine, the reduced flow of newly trained physicians will increase wages and expected earnings until the financial return to medical education is once again commensurate with the return in other professions

Question 4

What happens if there is a shortage such that patients must wait months to schedule an appointment with a physician,

Answer 4

consumers and/or health insurers will bid up physician fees, such that wages and physician earnings rise.

Higher earnings will encourage a greater number of students to enter medicine until long-run supply again equals demand.

Question 5

Why is it so that medical labor market is regulated by policy makers

Answer 5

The principal concern is that because of asymmetric information consumers will not be able to determine the quality of services provided by medical labor

Question 6

How do policy response on this

Answer 6

One response is to try to assure consumers that the inputs into the health production function exceed a minimum acceptable quality level.

Question 7

Which combination do policy makers use to increase the quality of medical workforce

Answer 7

1) requiring workers to be licensed before they may legally practice
2. ) certifying workers who pass an exam to distinguish them from lower-quality labor
3) accrediting schools and programs to ensure that graduates face a rigorous curriculum

Question 8

What is another way to increase the quality of medical workforce

Answer 8

to subsidize medical education, which creates rents for successful applicants and produces an excess of applicants relative to available positions.

High-ability students are more likely to be admitted when medical school positions are ratione

Question 9

Is licensing more costly ? Why

Answer 9

There are costs associated with medical licensing generally and restrictions on entering medical school. Licensing places constraints on the health production function by making it illegal to substitute between certain types of labor inputs for certain tasks. Licensing fees and the education requirements necessary to receive a license increase the cost of entering a profession and reduce labor supply at all wages, and the rationing of medical school slots truncates the supply of physician services. This will increase costs in output markets (e.g. physician services), increase the wages of licensed professions, and restrict product variety available to consumers.

Question 10

What is quality disclosure

Answer 10

quality disclosure “as an effort by a certification agency to systematically measure and report product quality for a nontrivial percent- age of products in a market.

Question 11

What are the effects of licensing on the labor market ?

Answer 11

For the higher-education and higher-income occupations like physicians, dentists, and lawyers, licensing appears to have large effects (on earnings) through either limiting entry or restricting movement to the state.”

For other medical occupations the results generally show no effect on wages, such as for nurses or a small effect on wages, such as for radiologic technicians and clinical laboratory personnel.

Kleiner (2006) concludes that occupations that work independently and interact directly with customers, such as physicians and dentists, receive larger benefits from licensing than paraprofessionals who are supervised by others, such as nurses.

Question 12

Why is certification better then licensing ?

Answer 12

a government agency administers an exam and certifies individuals who pass, while still allowing individuals who do not pass to legally practice the profession.

This would allow consumers (and/or health insurers) to decide whether to pay higher wages for workers deemed to be high quality without barring low-quality workers altogether.

Question 13

Why do the government choose to subsidize medical education

Answer 13

1. )medical schools have great control over the medical workforce; their decisions regarding how many students to accept determine the flow of domestically trained physicians.
2. )determining whether medical schools are restricting entry to create physician rents rather than fulfilling other more noble objectives requires a model of non-profit behavior
3. )the rationing of medical school positions may make licensing irrelevant or less important because schools will weed out (some) low-quality applicants .
4. it is unclear whether there would be fewer or more physicians trained if medical schools set tuition equal to cost

Question 14

Draw what would happen if the Government would introduce numerus fixus.

Answer 14

Zie tekening 2

Question 15

How sensitive is the income elasticity for physians

Answer 15

Studies show that physicians who make a lot of money show less response. They are not sensitive for higher proces.

Question 16

Describe the elasticity for nurses labor supply

Answer 16

the main conclusion is that the wage elasticity is inelastic/unresponsibe and that very large increases in wages would be needed to induce even moderate increases in nurse labor supply”).

nurse wages have a stronger effect on labor force participation than the number of hours worked conditional on working.

Question 17

Describe the income elasticity of physicians labor supply

Answer 17

the magnitude of the income and substitution effects of a change in the physician wage, and whether the physician labor supply curve is in fact backward bending.

As with nurses, most empirical studies conclude that physicians’ labor supply is not more responsive to the wage than other professions.

changes in income do not have a strong effect on physician work effort—the income effect is small.

Question 18

What is the difference in supply induced demand when a hospital uses fee for service or salary

Answer 18

With fee for service it can happen that doctors will treat patients above the guidelines ( overutilization of healthcare) because they get paid per visit.

Question 19

What will happen if the gouvernement will remove the numerus fixus

Answer 19

Prices will drop by 50% ,insurance companiers will start to push the physicians to lower their prices.

Question 20

Why is the supply curve for physicians steeper in the short run then the long run.

Answer 20

due to the length of required medical training and costs associated with moving between geographic markets (or between specialties when examining the supply of specialty-specific hours).

Question 21

What happens with the demand supply curve when physicans wage increase

Answer 21

If the physician wage increases, more hours will be supplied ( quantity will go up)in the short run as physicians who are already trained and practicing in a market decide to work longer hours