DEMAND AND SUPPLY MISMATCH

INDUSTRY TAKEN: ENDOCRINOLOGY (PREVALENT IN USA during 2008-2009) Endocrinology is a branch of medicine and biology which deals with the endocrine system. The endocrine system is the system of glands, each of secretes a type of hormone directly into the bloodstream to regulate the body. As per the estimates there is an acute shortage of endocrinologists in USA. This has caused problems to hospitals, patients, pharmaceutical industry, healthcare insurers, and physician recruiters. Due to such shortage there arises a difficulty in proper treatment of diabetes, obesity, metabolic syndrome, lipid disorders, thyroid nodules, thyroid cancer, and osteoporosis to name a few diseases. Endocrinologists are presently not dealing with new patients. Also, the waiting time for existing ones is easily between 3-9 months. Now, we shall discuss the economic aspect of the problem i.e. The Demand and The Supply of Endocrinologists. DEMAND SIDE: As per www.aha.org there are 6000 hospitals in USA. So, each hospital believes that they need at least one full time Endocrinologist. Many would require two instead. In case of large hospitals around 20-40 are required. There are several solo practioners, clinics and dispensaries which require Endocrinologist. So, they account for nearly 2000. Endocrinologists are also required for teaching and research purposes in educational institutions and universities. This number is estimated to be about 1500. In the end, the pharmaceutical sector is also looking for Endocrinologists to support their marketing, sales and R&D operations. For e.g.: Recket Benkiser which sells a product by the name of Detol requires an efficient pool of doctors for the research work. So, if we add up all such factors the demand function will be such that the requirement will be as close to 10,000 Endocrinologists.

Another way to evaluate the demand is by determining the number of patients with diabetes, cancer, osteoporosis and a number of diseases which are handled by Endocrinologists. So, according to estimates this figure is 44 million. So, even the above number of 10,000 is less. SUPPLY SIDE: According to the 2006 statistics by American Board of Internal Medicine, there were 5341 certified Endocrinologists in USA. There average age in year 2002 was 49 years which means it will be much higher now. Also, more than 1500 Endocrinologists were involved in research works which were not involved in patient dealing. Thus, there are roughly around 4000 Endocrinologists for providing clinical care. As per the estimates of www.acgme.org each year only 160 Endocrinologists obtain such qualification as compared to 185 in the year 1997. Out of 160, only half of them are worthy for clinical care which makes the situation even worse. Looking from another aspect there are only 4000 Endocrinologists for 44 Million target market.

So, from above demand and supply analysis we conclude that there is a situation of excess supply in the market. So, now the main problem is how to rectify this demand supply mismatch and create equilibrium in the economy. This would be achieved in the following ways: Firstly as the numbers of Endocrinologists are less in number and the people requiring such service are more, there will arise competition among the buyers of the service such that the price will increase and demand will fall which will in turn meet with supply and equilibrium will be attained. Second, due to higher prices (which will lead to higher incomes to the Endocrinologists) more people will be encouraged to become Endocrinologists and in the long run the supply gets increased which will meet the higher demands. Third, the Government can take active steps in this regard by procuring such Endocrinologists from other countries to attain equilibrium. Various hospitals should undertake Endocrinology training programs to fund the training slots. There should be third party compensation to Endocrinologists to make them competitive with other specialties.

Also, various practioners other than Endocrinologists should be encouraged to provide support for routine problems such as diabetes, obesity and cigarette smoking. This means Endocrinologists should be substituted by general practioners.