Federal health care policy and the geographic diffusion of physicians: A macro-scale analysis

The federal government passed legislation in the 1960's and 70's to increase physician supplies and reduce spatial inequalities in access to physicians. A major policy was to aggressively continue increasing the overall supply of physicians on the assumption that market forces would eventually divert physicians from areas of high physician density to those of low density. Using state-level, annual data collected over a 21-year period, this paper investigates the macro-scale spatial diffusion of physicians as an essential element in evaluating this policy. The results provide evidence of the policy impacting locational trends relating to primary care physicians, but not specialists. They also indicate that the Medicaid/Medicare programs may have adversely affected the maldistribution problem.