How does the "law of demand" relate to healthcare services?

The law of demand states that, all else being equal, as the price of a good or service increases, the quantity demanded typically decreases, and vice versa. In the context of healthcare services, this principle suggests that if the cost of healthcare rises due to factors such as increased provider fees, higher insurance premiums, or greater out-of-pocket expenses, consumers may seek fewer healthcare services or delay necessary care due to cost concerns.

Healthcare services often exhibit this behavior, particularly for non-emergent procedures and treatments where individuals might opt for alternatives, forego care, or rely on preventative measures. Conversely, if prices were to fall, demand for healthcare services would likely increase as they become more affordable and accessible to a broader segment of the population. Thus, the relationship between price and demand is crucial in understanding how healthcare markets function and how policy changes can impact access and utilization of services.