Demand is an economic concept describing the desire of the consumer to pay a price for services and goods. In the event, all other aspects have been constant; a rise in the price of a service or good would reduce the demand, and a reduction in the price of the service or goods would increase the demand. Rest assured that there has been increasing demand for home health care agencies near me you can find on myallamericancare.com.
Most nations would spend a decent amount of their Gross Domestic Product or GDP on healthcare. Two major contributors to the growth would be the increasing prevalence of preventable illness along with below-par use of healthcare resources. Such aspects would be influenced by choices made by the consumers. A good example would be obesity, heart disease, and stroke.
Most patients do not have adequate control of their health and seek treatment when their condition becomes chronic. It would be pertinent to mention here that lack of initiative to live a healthy life and prevent chronic illness such as obesity could result in misuse of the healthcare system. Consequently, there would be an increased cost. Let us go through the aspects of how the demand for healthcare differs from the demand for other available services. It would also cover the reasons whereby the consumers have made poor decisions concerning their healthcare choices.
Rest assured that healthcare holds value only when it improves health. Therefore, health has been primitive in the description of the preference of the consumer. The most important aspects or reasons influencing the demand in healthcare should be well defined for understanding the concept in healthcare. Some of these aspects have been mentioned below –
- Prices
The amount of money expected in payment for something.
- Consumer
A consumer is a patient or a buyer.
- Income
The amount earned through work or investment. Income could influence demand for healthcare. In the event, a consumer has a lower income, the consumer may not seek healthcare for common sickness. Similarly, a consumer earning more might be willing to spend on his specific healthcare needs.
- Governmental influence
Policies inclusive of subsidy could enhance demand for healthcare, as patients would be charged a lower price.
- Supply
The basic concept in economics describing the total number of a particular service or good available to a consumer would be supply. It could be determined by competing goods, prices, and demand.
Healthcare has been deemed different from other services, as it may not be clearly defined. In a majority of industries, the service or product could be standardized for improving quality and efficiency. In the healthcare industry, every consumer is chemically, emotionally, and structurally different. Rest assured that anything working for one person might not necessarily work for the other.
Healthcare would differ in terms of choosing consumers. In most services, you would be given a choice in selecting which person differs in terms of choosing consumers. In other services, you would have a choice in selecting a person or industry with which you could conduct business. In healthcare, treatment would be offered to patients similar to other industries. Insurance companies or government would pay for you. Such aspects make healthcare unique when compared to other available services.
The demand for healthcare comes from the wishes of the consumer to remain healthy. A majority of people prefer being healthy to suffering from sickness. Yet another aspect that makes healthcare relatively different from the other services and goods would be it being treated as an investment. The money spent by the consumer on remaining healthy would benefit the consumer in the coming times.
Another important feature of healthcare would be the inelastic demand. In the event, a consumer is sick and needs medical care; the consumer would buy healthcare services regardless of the cost. The ability of the consumer to buy healthcare has been ultimately restricted by the income of the customer. However, the chances of the consumer trading off by spending on several other products for buying the medical care needs would be higher.
Unlike the other services or goods, the quality of health makes it relatively difficult to meet an ideal market solution. Health has not been deemed a marketable product. It would not be possible to switch good health between two customers.
Moreover, healthcare, providers have been more knowledgeable about the illnesses and treatments as compared to their patients. Several patients are dependent on their providers to act in their best interest. However, there may be a conflict of interest, as the providers have been selling the services to the patient. In such a scenario, demand and supply have been interwoven and determined jointly by the person simultaneously. The chances of it resulting in market failure have been relatively higher.
A healthcare provider influenced by profit or enhanced income might order more services and tests than required. As a result, the consumer pays more for unnecessary services without having any knowledge and information on them. Moreover, with other available goods or services inclusive of buying an automobile, the buyer does not require having years of education before he looks forward to understanding the best vehicle to meet his specific needs. You could find the information through several avenues inclusive of automobile books, online search, or car television channels.
Yet another reason that consumer does not make a rational decision in their demand for health care would be due to overloaded information given to patients from the healthcare resources inclusive of insurance companies and healthcare providers. It would not be wrong to suggest that the healthcare system has been rich with information, as it gathers and generates huge volumes of information regularly. The information offered to the consumers could be technical and not as straightforward for most people.
Several consumers have been too impatient in dealing with overwhelming and unfamiliar information. Therefore, consumers tend to make poor decisions that might not prove beneficial for them in the long-term. The implementation of healthcare reform has come forth with several health insurance options suitable to meet your specific needs.
