Demand in the Health Care System Essay

The paper is intended to shed a light on the pertinent economic principle of demand in the health care system. With the growth in population, the health care sector has been globally affected as the number of patients has exceeded the number of health institutions. The implication made is that the amount of supply is more that the demand thus countries are forced to enhance their health care systems to accommodate the growing demand. Given the different nature of the health care sector from other goods and services, it is monumental for one to understand the critical role demand plays in the survival and thriving of the industry while guaranteeing customer satisfaction. Due to inadequate resources, the increased population presents a threat to human life. There are a few factors that determine the demand of the health care sector including the number of patients and the level of income amongst others. In the case that the situation is neglected and the economic principle ignored, the peril looming over the health care sector will admittedly bring about grave implications given the delicacy of the industry.

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The health service aims at revolutionizing its traditional means of operations into modernized services. In the past, health care services were characterized by non-affordability and inaccessibility due to the high prices and the lack of adequate resources owing to the large demand. In the developed countries, the health care services are easily and conveniently attained by the consumers who in turn enjoy high quality services. However, the problem is not completely solved as the issue of population growth is infinite. As the days pass by, the population of the world grows uncontrollably due to factors such as political stability and economic boom (Farbmacher & Winter, 2013). Consequently, the growth of the population posses a huge threat to the successful operation of health facilities as the number of patients will be more than the resources available for treatment. The number of hospitals worldwide is less than a third of the total population globally. This significantly means that the monetary and human resources necessary to fully satisfy the demand is also insufficient (Sengputa, 2016). Provided the vulnerability of the sector, any uncalculated mistake will result to regrettable outcomes as people's lives may be at risk. Therefore, the health care system mandates the regular study and assessment of the demand in the industry and the application of the appropriate measures to remedy the situation.

The aim of every business entity in the world is to fully satisfy its customers. However, in the health care system, this objective is almost never met. The reputation of the health care industry is one that needs no introduction. Service delivery has been one of the major concerns raised by the clients and other stakeholders. People fail to comprehend the genesis of the poor service delivery in health facilities and most of the times blame it on the faculty and other subordinate staff in the facility (Sengupta, 2016). The eminent cause of the predicament in the health care sector is the lack of sufficient resources compared to the number of the customers. When the number of doctors in the facilities is limited it reduces the number of patients who will be able to receive medical attention in that period of time thus making the process long and tedious. This explains the long hours spent by patients in the waiting lines to consult the doctors and also the many critically ill patients laying in bed waiting for the specialist doctor to attend to them. The number of deaths in the health institutions keeps rising not due to the negligence and incompetence of the workers but the lack of attention caused by the presence of less doctors compared to the patients.

The demand for hospitals is therefore influenced by several factors such as price, consumer preferences, the geographical population, the income of the consumer and the unpredictable factors such as disease outbreaks. Given the inverse relationship between demand for medical care and its prices, the demand curve of the health care sector assumed the same shape as that of other commodities with the demand curve slopping downwards. The price of any commodity forms one of the major determinants of demand and in this case it is no exception. Consumers prefer quality services from an affordable institution, therefore, when the services of a certain institution are highly priced then the number of clients seeking services from the hospital will decrease and vice verse, thus, the higher the prices of services, the lower the demand (Farbmacher & Winter, 2013). However, for the few privileged customers practice an exemption rule whereby they believe that the highest charging facilities offer the best services in the industry. This case is more related to the case of the luxurious goods and giffen goods where the customers have developed more faith on the costly products. Generally, public hospitals have the maximum number of patients annually due to their relatively low prices compared to the private health facilities.

Another major determinant of the demand is the consumer's preference. Depending on the status and reputation of an institution, customers develop specific preferences. The loyalty generated by the clients on these facilities determine the demand of a given institution thus a hospital that is known to deliver high quality services at a fair price will definitely have more loyal clients compared to one with unsatisfying service delivery (Sengupta, 2016). In some cases, the institution may be relatively expensive but due to its reputable good status, the patients would not consider the price but rather the services provided. Taking into consideration the critical health care sector, a professionally qualified hospital will guarantee life while the other facilities may lead to probable death due to poor services. However, the consumer preference is not fixed and tends to shift from time to time depending on various factors such as pricing and quality of product and services produced.

Consumer's income is also a determinant of the demand in health care. According to Keynes, most household hold money for precautionary motives, however, this is not the case for all households as there are consumers with no steady income. The amount of money in circulation determines the type of service facilities a customer would choose (Farbmacher & Winter, 2013). If the consumer is highly paid then they would go for high quality facilities regardless of the prices whereas when the income is reduced, the consumer will prefer affordable facilities even though the services offered are not of good quality. Also an increased income would enable the consumer to seek further medical help to proficiently solve their problem contrasted to when lowly paid. The increase in consumer income consequently increases the quality of services produced in the health care through increased funds to purchase the necessary facilities.

Conclusion

The demand of the health care sector is a critical economical factor that should be taken into keen consideration by the concerned stakeholders. The neglect of the principle would ultimately lead to the collapse and deterioration of the service which would prove fatal to the lives of the patients. The demand is influenced by many factors including the consumer preference, income and the price of the services. These variable factors affect the demand of service in the health care sector. Thus, if disregarded the excessive demand of services in the health care would lead to grave consequences which may include loose of life in extreme cases.

References

Farbmacher, H., & Winter, J. (2013). Per-Period Co-Payments and the Demand Ffr Health Care: Evidence from Survey and Claims Data. Health Economics, 22(9), 1111-1123. doi:10.1002/hec.2955

Sengupta, K. (2016). Economic Tools Used for the Analysis of Health Sector. Determinants of Health Status in India, 23-46. doi:10.1007/978-81-322-2535-5_2