Question

1. Describe the theory of physician induced demand for medical services.
2. Explain how the dual nature of the physician’s role as both advisor and provider support the induced demand theory.
3. Identify and explain what implications physician induced demand have for healthcare policy.
4. Discuss how health insurance reinforces physician induced demand.
5. Discuss what the natural limits to the alleged problem of physician induced demand are.

Answer 1

1.

• Physician-induced demand implies that a part of social insurance buys may reflect physician inclinations. This can happen as a result of purchasers' absence of data about the adequacy of different human services options. Therefore, they delegate the selection of options in contrast to their physician.
• In well being financial aspects, supplier induced demand (SID) can be characterized as the measure of demand that exists past what might have happened in a market wherein patients are completely educated.

2.

• The induced demand may appear as an expansion in the quantity of administrations or an adjustment in the administration blend gave to patients. It can identify with two wide sorts of medicinal assistance — discussions and referrals.
• Supplier-induced demand (SID) alludes to the thought that doctors can control their patients' demand for restorative administrations to make extra demand for the administrations. It can emerge from activities by doctors connected to personal circumstance or endeavors to advance the prosperity of their patients.

3. An assortment of market and institutional/administrative impacts can give doctors motivating forces or disincentives to take part in SID.– Substantial data asymmetries, the potential for a flawed office relationship and clinical vulnerability furnish doctors with the ability to participate in SID. In any case, these attributes don't ensure the nearness of SID.– Systems for financing, sorting out and paying for therapeutic administrations likewise impact specialist and patient conduct. SID is bound to win where buyers are allowed to pick their primary care physician, there is no authoritative or business connection among doctors and outsider back up plans, and doctors are compensated on a charge for-administration premise.

4. A few instances of territories where SID could profoundly affect the suitable plan of well being strategy include:

• the viability of utilizing co-installments to contain increments in well being consumption
• the viability of cost or charge controls in controlling increments in well being costs
• the attractive quality of utilizing supply-side activities, for example, deciding the proper number of doctors, the improvement and utilization of clinical protocols,and the utilization of usage surveys or administration observing courses of action.

5.

• There is a conduct component at the individual specialist and patient level that is significant in explaining the conditions under which SID may happen.
• The potential for SID to emerge is fundamentally impacted by institutional and administrative game plans.