Managed care has been growing and likely will increase market share. T
his movement will require fundamental alterations in the number and sp
ecialty distribution of physicians. Under current production, future s
upply does not appear well-matched with requirements, Although the ade
quacy of generalist supply is of concern, the oversupply of specialist
s is the overriding problem. Neither reducing the number of first-year
residents nor increasing the generalist output alone would bring both
generalist and specialist supply within requirement ranges. Combining
an increase in generalist production to 50% with a reduction in first
-year residents to 110% of the number of U.S. medical graduates would
minimize the projected specialty surplus while maintaining generalist
supply within the requirement range.