The Supply of Physicians and Expenditures for Health Services with Implications for the Coming Physician Surplus.

Although the dramatic rise in national expenditures for medical services the past quarter century is due to a number of factors, this paper investigates the hypothesis that an increase in the supply of physicians is one major factor. Longitudinal analysis of trends for the United States from 1940 to 1981, and the cross-sectional analysis of eight industrialized countries and nine census regions in the United States, support the hypothesis. Since the increase in physicians is largely due to deliberate policy decisions in the past, the increase in costs, which policymakers are now trying to contain is in large part the result of actions that policymakers themselves have made. The increase in the supply of physicians (the "physician surplus") will put upward pressures on the national expenditures for medical care in the years ahead. [ABSTRACT FROM AUTHOR]