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Health Economic Tools and Concept

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Health Economic Tools and Concept
Chinenye Nwokey
December 2 2013
Amy Shoales

Economic Tools and Concept
The United States is presently confronting a nursing shortage which is likely to get worse in the future. The shortage is compelled by amount of reasons linked to the employment and maintenance of nurses. Less young females going into nursing schools as professional prospects in other areas have stretched. Countless eligible candidates are denied admission due to a scarcity of nursing instructors at schools. The student will present economic tools and concepts pertaining to health care issues (nursing shortage); the student will use marginal analysis and supply and demand curve to assess the issue of nursing shortage as it relates to health care. These tools are designed to explore and evaluate the nursing shortage. Registered nurses are the major set of health care specialists in America and Worldwide. It is important to understand the effects that a nursing shortage has on the economy and the health care system.

Supply and Demand
Supply and demand curves are vital when considering the number of registered nurses available to provide services to patients in need of care. A good service is said to be scarce when more is desired than can be satisfied with available resources which means demand exceeds supply. Quantity and quality of care demanded are greater than quantity of nurses supplied (Lane & Grohmann 1995). Nursing is a professional fields in which the nurse provides services (good) to the patient. These services must be completed in the nurse’s given shift. Patients are consumers, nurses (suppliers) spend their time providing health care services to patients, and a quality care service required by the patient is the demand. Nursing shortage has an effect on the quality of services that nurses can provide to patients. For example, if a nurse has too many patients to take care of, the nurse has to prioritize the patient’s needs and provide the necessary care first. This division of time often leaves some patients with less time and a decrease amount of service. When the need for quality care services exceed the number of nurses available to provide the services, the condition of scarcity exists. Condition of scarcity means large demand for a product or service, and resources are not available to meet the entire demand. The nurse must make a choice with respect to which services will be provided for which patient. For health care organizations to provide quality cost effective care for their patients they must assess availability of nursing staff and the environment. There is a relationship connecting nursing staff shortage and adverse patient outcomes, many factors can lead to nursing shortage. According to institute of Medicine, nurses in some health care facilities may be overburden with up to 12 patients to care for per shift. Long hours pose one of the most serious threats to patients’ safety, because fatigue slows reaction time, diminishes attention to details and contributes to errors (Morris, 2012). Nursing shortage is a common problem in the health care industry, the present workers are getting old, up to one –third of working nurses are 4o years or older. The workers have to care for a greater amount of patients and toil extended shifts. Great intensities of job discontent and exhaustion have dropped the maintenance amounts of both freshly out of schools and knowledgeable nurses. Their adverse fillings have had a recurring result, making employment of new nurses even more difficult. Productivity will be low and service will be poor. Staffing shortage and the workload turns hospitals into a stressful unhealthy environment. Nurses sees shortage of nurses in the future as a facilitator for growing strain on nurses, reducing patients care value and forcing nurses to leave the occupation (Peter, 2005). Many nurse become hypertensive, diabetic, cardiac and renal patients, then they leave the job to seek treatment. Understanding the demands on the nursing staff can assist an organization in supplying high quality care to patients. Organization can fix their nursing shortage related problems by using acuity to establish their patient-nurse ratios. By supplementing staff with auxiliary staffs and giving incentives to nurses that volunteer to work extra. The organization can give sign on bonus to attract new nurses, plus give bonuses to nurse that refer their friends. Some hospital administrators came up with variety of incentives, plus better salaries and benefits, accommodating schedules, smaller amount of float pool workers, remove compulsory overtime, creating professional ladder and improved acknowledgement as maintenance policies. Adequate staffing will increase morale, eliminate mandatory overtime, reduce workload and increase quality care to patients.

Marginal Analysis
Organization need to understand how a nursing shortage affects the quality of care given to patients and the perception of the organization. A market analysis is a way of determining how many nurses and what resources are needed to produce high quality care to patients. Marginal analysis is most effective in the setting of an accurate and valid production possible. The unit manager will use the number of nurses scheduled to work on the unit in a given shift and the number of patients on the unit to assess efficiency of the unit. Efficiency in medical care is not just a matter of technical excellence and minimizing the cost of production. More often, it depends on how much is produced and which patient gets treated. Organizations need this understanding to maintain the expectation s of their patients. Patients expect high quality services, and it is an organization responsibility to provide such resources to get the service done. Patients want their needs met, they don’t want to hear about the nursing shortage. Marginal analysis provides the assessment of the organization’s resources input and production outputs. Conclusion The nursing shortage is a health care issue that needs to be solved. The limited supply of nurses can cause increase demand for nurses which will lead to increase cost of health care. The economy is affected because of the limited supply of nursing resources and production. Using marginal analysis to assess efficiency and production of a nursing unit will show the number of patients on the unit and the number of nurses providing care to the patients. Marginal analysis supports decision-making based on marginal or incremental changes to resources instead of one based on totals or averages. Organizations need to understand the various contributing factors to nursing shortage and provide acceptable solutions. Nursing is a major contributing factor to the health and economy of our Nation. Providing the resources need to provide care to patients is essential for the health of the nation.

Lane, J., Gohmann, S. (1995) shortage or surplus: economic and noneconomic approaches to the analysis of nursing labor markets. Southern Economic Journal. Vol.61, no3.pp644-653
Morris, S., Parkin D., Devlin N (2012) economic analysis in health care: The production and cost of health care. Retrieved on November 26 2013 from http://www.custom select
Needleman, J. (2002) nursing staff levels and the quality of care in hospitals: New England journal of Medicine. Retrieved November 26 2013.

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