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Data for period 1960–1992 from Health Care Finance Association
(which was the predecessor to the Centers for Medicare and Medicaid
Services); Data for period 1993–2003 from Centers for Medicare and
Medicaid Services, Office of the Actuary: National Health Statistics
Group.
Why were Americans willing to increase their spending on health care so
dramatically? The model of demand and supply gives us part of the
answer. As we apply the model to this problem, we will also gain a better
understanding of the role of prices in a market economy.

The Demand and Supply for Health Care
Figure 4.15 Total Spending for Physician Office Visits

Total spending on physician office visits is $30 per visit multiplied by
1,000,000 visits per week, which equals $30,000,000. It is the shaded
area bounded by price and quantity.

Attributed to Libby Rittenberg and Timothy Tregarthen
Saylor URL: />
Saylor.org

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