Current and Future Economic Issues Impacting Healthcare Sector Coursework

Current and Future Economic Issues Impacting Healthcare Sector - Coursework Example This paper thoroughly analyzes these five factors that are affecting the demand and supply, as well as the costs, of health care services in the United States. It also suggests specific strategies that relevant entities may use to address these issues from an economic perspective. Physician sovereignty implies that health care professionals, such as doctors, largely influence or regulate the demand for health care. People believe that they require the checkups, medicines, and therapies that the physician advises. Health care demands professional knowledge or expertise. People depend on the doctor. The physician could consider cost, but they are obviously minor (Culyer et al., 2011). Decisions are made based on established clinical knowledge and practice and the guarantee of appropriate, correct health care. The usual thriftiness of a consumer who weighs prices against one another thoroughly and makes budgets is nonexistent in health care. Although this is not essentially negative, it does further result in a greater demand for, and thus increasing costs of, medical care. Moreover, within conventional ‘fee-for-service insurance’, the higher the number of services that are suggested the greater the income the physician or hospital gets (Aizer, 2007 , 405). This situation could result in unnecessary services with gains that are not equal or more than their costs. In fact, physicians may be inclined to over-service, over-test, and overprescribe, particularly if this excessive medical care lessens the possibility of an expensive medical malpractice case (Hicks, 2014). The over-demand produced by third-party payments is a perfect illustration of how consumer decision-making and behavior can be influenced by financial incentives. Consumers are simply acting in response reasonably to the incentive of a lowered price, and the unused or misused medical care is an indication of consumer preference. The result may not be socially desired, yet the consumer remains