“The problem isn’t an overall shortage of doctors, but how they are distributed geographically and in what specialties.”
It may appear that is the problem. However, keep in mind that the geographical distribution is something that IS determined by the market still. If they are gravitating to certain markets, then it’s because the greater demand is there. To a lesser degree this is also true of the concentration in particular specialties, although, even in that area, there are regulatory restictions on who can practice in what area, so the market does not reign supreme.
My point is this: You can’t say that the market is misallocating resources geographically or by specialty. What’s happening is that there is an overall shortage, and physicians are crowding into the geographical and specialization segments that are the most rewarding, thus leaving the other segments of the market with an inadequate number of physicians. It again is the bottleneck problem. If there were more physicians, then there would be more physicians in all of the markets. When you have an overall shortage, certain segments of the market suffer more than others.
Demand erquates to money, Many small towns and rural areas don't have doctors readily available. They try to entice them with various incentives and packages.
To a lesser degree this is also true of the concentration in particular specialties, although, even in that area, there are regulatory restictions on who can practice in what area, so the market does not reign supreme.
What regulatory restrictions are you referring to? We do know that our medical schools are not producing the specialties we need, like surgeons. Although it may not be politically correct to say it, the de facto quotas in medical schools for women have changed the output in the specialties with women being more interested in pediatrics and OBGYN. Foreign-trained doctors have been filling the gaps. Our medical schools produce about 17,000 doctors a year and we have 24,000 residencys. The remaining 7,000 are filled by foreign-tgrained doctors.
My point is this: You can’t say that the market is misallocating resources geographically or by specialty. What’s happening is that there is an overall shortage, and physicians are crowding into the geographical and specialization segments that are the most rewarding
Most rewarding monetarily in many cases given the huge debts most medical students incur before entering into practice.
If there were more physicians, then there would be more physicians in all of the markets. When you have an overall shortage, certain segments of the market suffer more than others.
The shortages can be filled and are being filled by foreign-trained doctors.
Yes and no.
Medicare pays more - a lot more - in certain areas. But Medicare prices do not follow demand, in fact, they are almost opposite to demand.
For example, Medicare pays doctors very high prices in South Florida. I don't know if you've noticed, but they almost have MRI scanners in gas stations there.
In places where there are few specialists and long waits, Medicare prices are very low.
If supply-demand was working, fees would be higher where supply is low, and doctors in South Florida would be washing cars on the side.
Another victory for central planning.