Sunday, December 28, 2008

I'll go if Dr. House is there

County Executive Ulman and County Health Officer Dr. Beilenson are co-hosting a county-wide health care reform discussion(.pdf) in Columbia on December 29. The gathering is intended to provide a forum for discussion about the lack of access to health care and the reasons behind it.

As I have stated before, if government regulation worked then the health care industry should be the smoothest running industry in the country. Unfortunately, health care is one of the messiest. This is not the case despite the government intervention; it is the case because of government intervention. Labor unions, like the American Medical Association, and government licensure limit the supply of doctors. Yes, they make sure that the supply of doctors that do exist are very high quality, but there are not enough of these doctors to go around. Eons ago, Milton Friedman wrote a paper that explained why doctors made approximately a third more in income than dentists (at the time). This paper was completed in 1941 but was not published until 1945. This delay was partly caused by the war but mainly caused because one of the conclusions reached was so controversial. That conclusion, which seems common sense to us now, was that the difference in pay was due in part to AMA barriers to entry in the medical field, whereas no such barriers existed (at the time) in the dental industry. Restricting and regulating the supply of doctors is always done under the guise of protecting patients, but the reality is that it hurts patients and protects doctors’ paychecks.

If you have a case of poison ivy, there is no reason that you should have to see a full fledged doctor to get the medicine you need as you do under the current system of regulation. There is no reason that the FDA should be regulating medicines. There is no reason that marijuana should be regulated so that those who need it for medical reasons (or any other reason) cannot have access to it. Regulation does not work.

The only fair and efficient way to allocate health care is to deregulate it and let the market decide the allocation. Everyone wants health care to be free, but life does not work that way. If our government officials find a way to allocate health care in a manner that is more fair and efficient than the allocation that arises from the voluntary transactions of individuals, then government should apply that same methodology to every other allocation of scare resources from pencils to clothes to computers to cars to houses to airplanes. However, the record of history clearly suggests that the only fair and efficient way to allocate resources is in a freed market.

2 comments:

Anonymous said...

Instead of freeing up licensure, they're handcuffing patients by locking up insurance with govt intervention.

Physican's assistants are competent to perform 70% of what a GP does in his office, but commercial insurance companies won't cover that professional, so patients are forced to see a Dr.

We need more PA's and nurses, and we need to stop tying their hands with insurance coverage/payment restrictions.

Freemarket said...

A major part of the problem with health care is that the barriers to entry in the medical field have made health care so expensive that you are a fool to see a doctor without health insurance. Who can afford to do so? If prices for health services were more reasonable as they would be if health care was not so heavily regulated, then the pull of insurance companies would not be so large.

There is something wrong when the first question you are asked in the doctor’s office is not “what ails you?”, but rather “what insurance do you have?” I don’t know of any other business like that, and it is a sign of very high prices.