Does the Supply Side Matter?
Does hospital capacity matter?
Hospitals are well prepared to deal with [an] unexpected volatility in demand, as by and large it does not negatively affect patient outcomes. Hospitals seem to deal with high unexpected workload by steering the patients’ length of stay relating to their severity of illness. Elective patients are discharged earlier, while discharges of high-risk emergency patients are postponed.
Does the doctor/patient ratio matter?
We found that patients living in areas with more physicians per capita had perceptions of their health care that were similar to those of patients in regions with fewer physicians. In addition, there were no significant differences between the groups of patients in terms of numbers of visits to their personal physician in the previous year; amount of time spent with a physician; or access to tests or specialists.
HT to Jason Shafrin.
Not to put words in your mouth, but it’s almost like you are describing a supply side that can expand or contract, to always make supply equal demand.
That is, doctors can fill their day — whether there are few patients or many patients. Hospitals can fill all their beds, whether their customers are few or many.
This is an interesting way to think about the market.
I find this surprising. I’m not sure what to think about it.
There are numerous variables that impact a length of stay. Doctors are the only ones who can admit a patient or discharge a patient from the hospital. But to a small extent, all parties can influence hospital length of stay. Medicare pays based on a DRG – to give hospital an incentive to discharge patients quickly. But some patients don’t want to return home too soon — preferring to be cared for a day or two longer. Meanwhile, some patients cannot wait to get out of there. Discharge planners often help coordinate a discharge with a doctor.
Hospitals face multiple constraints. One is staffing. They build a lot of rooms but don’t staff them unless demand picks up. In one case I know of, a severely injured person needed to transfer from a small rural hospital to an ICU in his home city 1,000 miles away. The transfer was delayed for a couple of days while the city hospital adjusted its staffing to open upan ICU bed.
Health care without flexible labor markets would be very different which is why SEIU and company efforts to invade health care are cause for concern.
I think Linda’s point is a good one. Maybe we should be glad there is this kind of flexibility on the supply side.
I myself have always wondered how hospitals dealt with massive influxes of sick people (I’m thinking flu or natural disaster). Likewise, I’m betting there are times of the year when people are relatively healthy (who could be sick on a nice day like today?).
This sort of elasticity in supply is probably a good thing, but the fact that length of stay and admissions increase during slow times suggests that hospitals aren’t always doing what’s in the patient’s best interest.
I’m not sure if it’s better to be sick during a busy time or a slow time. I personally prefer neither.