I love some of the replys on here, they make me laugh. Some people don't care that they can carry 20 healing pots and use them all in one fight, while others think it should be limited to number you can carry or use at one time. I personally prefer the old D&D approach, such as in Balder's Gate II. Its been a long time since I played BDII, but if memory serves healing potions were not very plentiful in the world as loot, and they were expensive to buy. This made having a dedicated healer and one alternate healer in your party essential. Also, the healing potions only came in 2-3 varieties of strength, and the minor healing potions became useless at high levels for anyone but your mages/healers with really low HP pools. This did 4 things: 1) Any time you found potions as loot was special 2) You did not buy, hoard, and consume tons of healing pots as it was simply not easily done do to limited supply/price 3) Healing potions became your solution to extremely difficult/boss fights, and were not used for just any average monster clash 4) Healing spells were essential. Now then, I know that Skyrim is entirely different from the group RPGs like BGII, and that you can't expect to play one like the other. But my storage chest in my house in Whiterun has a stockpile of healing/mana/stamina pots that would make a BGII character cry with joy, the same as if he had just found 50,000 gold (gold was not available in the vast qauntities that Skyrim possesses either).

Seriously though, healing/mana/stamina potions are so plentiful the only reason to take Alchemy is if you want to make uber potions or if you just enjoy it. They make Restoration useless, unless you are RPing or just like to use it. Yes, Restoration does a few things other than heal such as turn undead/wards, but it is a minimal return on effort for those pursuing Restoration. I think that potions are so easy to come by in the game that you could never buy a single potion or use a single Resto heal spell and never run out of potions. I personally play as a mage, and use Resto to heal myself and my followers most of the time. I carry only a few heal/mana pots for emergencies, but can't seem to help myself when I see them laying around as loot. My OCD to pick up every potion I see has lead to quite the collection in my home, as I only sell off potions that I know I will NEVER have a use for. And so to the final point, I think that potions should be less plentiful as loot for 2 reasons: 1) This would make Alchemy more useful, since you could make more/better potions than you could find and 2) Restoration would be more useful since the likely hood of running out of potions would be much higher, meaning people would prefer Resto in non-emergencies and fall back on the potions for really tough fights.

Restoration is way more reliable, especially Fast Healing and the perk that doubles the spells effectiveness.
I run out of potions

I think it's balanced ok. Why should something that weighs nothing, costs nothing be more powerful? It's like the people crying about destruction magic. It's like your the guy pressing the nuke button in the bunker, how much risk are you taking compared to the soldier on the front lines? And potions are expensive as hell too, and scare as hell. Until I got some nice armor I was always out of potions because I was healing up 300+ points of damage in one fight.

Frankly, what is the POINT of using healing spells during combat, which drains your magicka, and needs time to cast, if you can instead press "I" to open up inventory and pause the whole game, and then drink DOZENS of healing potions in an INSTANT?

1. It's completely free.
2. It means you don't have to carry potions which saves weight.
3. It levels up your Restoration allowing you to get the Recovery perk faster.
4. It levels you up which means better loot.

This is actually an ancient issue since RPG with an inventory system that pauses the game when opened exists (and it exists in all TES games). But it is even more glaring in Skyrim.

Frankly, what is the POINT of using healing spells during combat, which drains your magicka, and needs time to cast, if you can instead press "I" to open up inventory and pause the whole game, and then drink DOZENS of healing potions in an INSTANT?

And it's not that healing spells are much more powerful than potions, let's say Fast Healing, it only heals something like two bottles of minor healing pots, and it is sure NOT FAST (compared to instant potion drinking).

And it's also not that healing potions are rare and expensive. They are actually so many around like mead and ale. And pass level 20 they all can heal you at least 75 HP and if you're good at alchemy you can heal even more with custom pots.

So currently healing spells are more or less worthless during combat, because using potions is much more easy, safe, and isn't even remotely expensive. The only good time to use healing spells is out of combat, and then it's completely meaningless because you regenerate health out of combat.

Some may say you can make the game a little more "fair" by never open the inventory during fights, and use potions only by assigning them to a favourite and a hotkey and use them in real time only. Still the issue is here because you drink them INSTANTLY with each key pressing. The only way to play it "fair" is by restricting yourself from using pots during combat and use only healing spells, or play it like the NPC, only drink one or two when your health is really low and you force yourself to run away for a few seconds. BTW, if your magicka is low by casting spells, including, ironically, healing spells, the only way to recover magicka is drinking potions.

IMO, gamesas (or modders...) should have made potions and healing magic more balanced. Potions is an item which can be used universally among all classes, and many non-magic users must rely on them to heal themselves. On the other hand healing spells is a speciality for mages, priests and paladins alike, they should have an advantage at using it. However currently even mages and priests prefer to use healing pots because it's cheap, easy to use, and even more efficient than using their hard learned and practiced healing spells, which is ridiculous.

I find myself using restoration 75% of the time and potions about 25%, mainly because restoration is faster and I tend to run out of healing potions very fast.

Alchemy in TES games is always unbalanced both in terms of strength and as a gold mine. Each game (including Skyrim) I got alchemy to 100, saw how it unbalanced my game in terms of making me super rich and powerful, and then rerolled and never touched alchemy again in order to have a fun play through. I made threads before asking if Bethesda FINALLY balanced alchemy before Skyrims release, but the Devs always locked them. Seems they could have just answered: "No! Just as broken as before!"