Fantasy Free Healthcare

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The American public is too insecure to accept a free market healthcare system. Under the system in place now, you may have noticed that goodwill has completely disappeared. The healthcare system consists of patients as commodities and generic doctors. A visit to your doctor includes blood work and about seven minutes of the doctor’s time. If a condition cannot be diagnosed by a doctor glancing at any abnormal blood work statistics you are out of luck. Insurance companies give your medical information to pharmacies. Pharmacists now function as telephone solicitors, calling customers to suggest drugs for your condition. Because of lobbyist written healthcare laws, the whole system has turned into a feeding frenzy. Enormous premiums are charged for health insurance and there really is no insurance at all. What you are really buying is an expensive payment management system.

Why has goodwill disappeared? Goodwill is optimized in a free market system. Goodwill on the part of sellers is the only way to keep customers. The further away a market is from being free market the less goodwill there will be. In a completely managed healthcare market like that of the U.S. goodwill disappears completely.  Doctors are having to see many more patients to maintain the income and lifestyle they are used to. To keep from losing ground, they must run patients through their practices like cattle are run through chutes when they are vaccinated.

Are American’s happy? You would think they would not be but mostly they just go with the flow and don’t complain. . Medical errors are now the sixth leading cause of death in the United States. Citizens have given up most of their rights to sue in civil court. Tort reform has left folks with very few was to right wrongs. It is now open season season on patients. When a whole population does not object to being fleeced, there is not much that can be done in terms of changing the system. If that changes, there are better alternatives. Even in a single payer system patients would generate a little more utility out of a visit to the doctor.

The plan I am going to suggest is better than single payer. It is not as good as would be a complete free market system but citizens would die before they would opt for that. Certainly others have thought of this system. It is so simple that it would be impossible for it to be otherwise.

Assuming Americans insist that government be part of the healthcare system, this is the best way to do it. First it must be acknowledged that no bill written by lobbyists is going to do anything other than take the public to the cleaners. Lobbyists write bills to do exactly that. That is a lobbyists job.

Issue everyone in the country a plastic card to use in buying medical services and prescription drugs. Card holders would pay doctors, hospitals, labs and pharmacies with the card. Patients would be billed on a sliding scale. This would cost far less then the enormous premiums patients are force to pay for health insurance policies.  Doctors and others would have no way of knowing who pays what percent of their bill. That way there would always be a free market influence. No bureaucracies would be involve in managing patient’s behaviors or other things bureaucracies normally do. Very rich people would have to pay their entire bill. With government involved in healthcare this is the least costly and most efficient method.  There is no such thing as a free healthcare system.

How would doctors be paid? They would end up being paid according to their utility to society. That is ultimately how incomes are determined. Some would do better than others. I believe on balance they would come out ahead. Even though in the beginning most would opt to keep things the way they are. Their costs would be reduced. They would make a living treating patients. Certainly medicine requires a certain aptitude. I would guess a doctor would get a lot of satisfaction from healing people. They would have time to do just that. I would never want to be a doctor. I would not enjoy spending my days doing what doctors do. Most doctors would probably not enjoy being an economist. It is great that people are called to do different things.

The key to having a good health care system is passing a lobbyist free law. That is very difficult since all bills are now written by lobbyists. Lawmakers are basically paid with campaign contributions to do what lobbyists tell them to do. The kind of law I am suggesting would have to be written by a group of citizens and there would have to be a way to coerce lawmakers to vote on it and pass it. That is where the difficulty lies.

 

 

About Fantasy Free Economics

James Quillian is an independent scholar and economist.

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