Also, exorbinant salaries and good hours are not to be found in the hospital system. Yes, specialist doctors get paid "well", but not exorbinantly, when adjusted for required training, education, experience, and opportunity cost. In private practice, the hours are better, yes -- but only in certain subspecialties. But this is like saying major airline commercial pilots should just fly private charters for a better lifestyle, or that software engineers should just work at hedge funds as quants for better compensation.
It's the hospital system, not private practice, that shows us a healthcare system where doctors are being put to their unique purpose of advanced clinical treatment. And that's where the market is failing.
Healthcare requires the hospital system to provide the most advanced and emergent forms of care, and that is where doctors are overworked and undervalued.
As for the free market, I wish you were right that it could fix the US healthcare system. But patient health is, unfortunately, not valued correctly by the market. The market rewards chronic treatment, whereas society prefers one-time cures. The market tries to monetize patient-doctor interactions, whereas society would prefer fewer doctor visits with fewer hospitalizations. The market treats doctors as a cost center whose hours needs to be billed out at a profit, and society would prefer doctors as a value center who are given the professional leeway to use clinical judgment in assigning time to cases and patients.
I love market systems, but only when they work.
(1) The supply of doctors (and other health professionals) is restricted by licensing, not driven by the demand for their services.
(2) The price of health care is not determined by supply and demand, but by various regulatory arrangements and bulk agreements which often do not involve either the producers (doctors, hospitals, etc.) or the consumers (patients) of the services. So the parties who are determining the prices are the ones with the least possible stake in the outcome.
(3) The consumers of health care, patients, are almost always unaware of the cost of the services they are getting, so they have no way of knowing whether those services are worth more than they cost, and hence no way of signaling where health care is being inefficiently provided.
(4) What the US healthcare system calls "health insurance" is actually a combination of insurance and prepaid health care. Insurance is supposed to be for unforeseen costly events, but most health care does not consist of unforeseen costly events but of predictable expenses (annual physicals, shots) and unforeseen not very costly events (you go to the doctor with the flu, get an exam, and are told to rest and drink lots of fluids).
(5) Prescription drugs are regulated by a regime (the FDA) that is heavily penalized if an approved drug has any bad effects whatsoever, but suffers no penalty whatsoever for keeping helpful drugs off the market for years while they undergo "testing" and hence depriving large numbers of people of their benefits.
I'm sure there are more, but those are just the ones I came up with off the top of my head.
(6) basic health care is not a market and pretending it is has been nothing but a moral and economic catastrophe in the US.
Why not?
I myself would prefer the one time cure, and would be willing to pay for it.
In a perfectly free market, my demand for the one time cure would be represented by market forces.
Now ask yourself, what is it about the healthcare market, that PREVENTS my market demand for a one time cure, as a consumer, from effecting the market?
The other thing is that with the current system (i.e. medical doctor prescribes), there's liability coverage through the doc's liability insurance, which unless psychologists are interested in taking on huge liability insurance premiums...
and pharmacology, and physiology, and several years on the wards watching the meds go in, watching the pee go out (or not), seeing what happens to the patient, sorting through laundry lists of meds at admission and discharge, losing arguments with pharmacy about why that max-concentrate K-Phos is a bad idea considering the patient's CCr was 1.1 yesterday and now it's 1.4, etc, etc.
Most health issues are not emergencies. I as a consumer would be perfectly happy to shop around the market, and find the best deal on healthcare, if my efforts were rewards.
Unfortunately, prices are not transparent, and the costs are not payed directly by me. They are paid by my insurance provider, so why would I bother trying to reduce my bill by thousands of dollars, if someone else is paying for it anyway?
I've heard that people with high-deductible plans are now finding it advantageous to just say they are self-pay to get the discounts.
For comparison shopping, healthcarebluebook.com can give an average price for a certain procedure in your area.
Also food is cheap and plentiful to create.
And most importantly, food is easy to steal; the one important factor in a functioning free market libertarians tend to forget about is the natural control at the bottom, for the poor: if the poor need something in order to survive and can't afford it, they act as a check on greed and neoliberalism run amok by ignoring the fake magic pieces of paper that the wealthy wave around as tokens of power and take what they need.
It's a lot harder to steal health care so there's no incentive for the rich to modify the system to help the poor like there is with food.
Yes, and this is a bug, not a feature. Food would be cheaper if this were not done. The "subsidies" are to the food producers, to artifically keep prices up. The equivalent for health care would be subsidies to health care providers.
> and food for the poor
Yes, with food stamps. But nobody tells the poor what they have to spend the food stamps on, and nobody regulates grocery stores up one side and down the other telling them what food items they have to provide if they accept food stamps and what they have to charge for every single item. So this regulation is nothing at all like US health care regulation.
The equivalent of food stamps for health care would be to give poor people a flat sum of money per month on a "health care spending card" that they could use at any health care provider they wanted, for any service they wanted. And then no other regulation of health care providers--no rules about what services they have to provide, no regulation of prices, etc. I personally think this would be a significant improvement over the current US system.
> food is cheap and plentiful to create
Yes, and it would be cheaper if the government did not subsidize producers, as above. The reason for this is, of course, that there is a free market in food (or at least much closer to one than the market in health care) and so producers are competing on price, therefore driving them to make food production more and more efficient. A century ago in the US, food was not cheap and plentiful to create. Technology and production processes improve over time if they are forced to by competition. I see no reason why the same would not apply to health care, if it were competitive the way food production is.
> food is easy to steal
This is an interesting point, but I'm not sure how much difference it makes in itself, because even the richest person in the world can only consume a limited quantity of food. So it makes no difference to rich people whether the poor can steal food or not; even if they do, the rich won't be the one to suffer, someone much further down the income ladder will (if anyone does).
A more interesting aspect is this:
> It's a lot harder to steal health care
I would rephrase this as: health care is much less fungible than food is. You and I can trade lunches, but we can't trade, say, gallbladder operations or physical exams. I agree that this is potentially a valid reason to treat health care different from food. What might be helpful is to look at other goods or services that are not fungible and see how they are handled in comparison with health care.
Food is heavily regulated, including the food bought by stamps. The government decides what can be purchased by the stamps, and every item of food sold in any store across the country is approved for safety and health. Without these regulations we would have massive constant food related deaths as producers compete on price and compromise safety to the detriment and possibly death of any customer who cannot afford the high quality "market regulated" product which is exactly what has happened in every unregulated industry in the history of the world. And for higher end products: the calculus of a PR cover up operation and possible civil suit vs. actually safely creating food is done by companies, and currently federal regulators weigh in on the side of 'you had better make this safe or else'. You are proposing pushing the balance here towards "well, if we can save a buck, screw it, we can tie the victims up in court until they go bankrupt and die anyway or blame it on the supply chain and promise we will do better" which makes safety much less important.
A health care spending card is perhaps a natural suggestion but is made all the more insidious because it is so. It is, in reality, an atrocious and murderous idea; the entire crux of health care is not only that it is essential to living and therefore has an infinite price and that quality is almost impossible for consumers to accurately assess but that needs for different people are drastically different, usually for reasons that have very little to do with their choices or desires, which is why it is generally taken care of by insurance while people do not buy "food insurance". Health care spending cards (or HSAs) are essentially a euphemism for condemning any poor person who gets sick to death.
And of course it makes a difference whether poor people can steal the food. Remember that unfettered free market capitalism is the system where a rich man's dog eats 5 course gourmet meals while his poor neighbor's child dies of hunger. Putting something necessary for survival behind an arbitrary chalked in line and saying "sorry, you don't get to have that because you weren't born rich and the neoliberal market economy has transitioned and has no room for your skillset, enjoy your one free death, maybe when you are reincarnated your father will be named Koch" is a very fast way to start riots and anarchy. The only reason the rich are rich is because the poor believe they are and act accordingly, we call this belief structure market society and government; shattering that necessary illusion will likely hurt everyone, but it most definitely hurts the rich. The point is that if food is available but inaccessible to the poor the free market and governmental structure in place will cease to exist -- the market and government have evolved in a very careful way to prevent this from happening.
I'm sorry, but I don't buy this assertion of yours, and since we disagree on something so fundamental we're unlikely to be able to have a useful discussion.
> which is exactly what has happened in every unregulated industry in the history of the world.
This is an extremely strong claim which requires extremely strong evidence. Do you have any?
> the entire crux of health care is not only that it is essential to living and therefore has an infinite price
By this logic any action which carries any risk of reducing your life span and is not absolutely necessary should not be done. Do you live your life that way? Does anyone?
> unfettered free market capitalism is the system where a rich man's dog eats 5 course gourmet meals while his poor neighbor's child dies of hunger
This certainly happens in systems that are regulated by governments--such as ours. Where is your evidence that it happens, and is worse, in systems that are not regulated by governments?
> if food is available but inaccessible to the poor
In a free market, what would prevent the poor from producing their own food? In the US, historically, this is how most people got their food--they grew it or hunted it or fished for it themselves. Or they lived in small communities where everyone knew each other personally, so they knew the people producing their food. Our current system, in which almost all of us are dependent on a small number of food producers whom we don't know and cannot influence on our own, is, as you appear to agree, a product of massive government regulation--combined, as you conveniently forgot to state, with massive regulatory capture on the part of the corporations that own most of the food production capacity.
Yes, the government inspects food to see that it doesn't contain harmful microbes--but people knew how to do that before the government got into the act (if not, humans would have gone extinct long ago from food poisoning). The government also subsidizes the production of high fructose corn syrup and factory farmed meat and poultry. It subsidizes wheat and corn so that most of the US's acreage goes to those crops instead of a greater and healthier variety. (And then it subsidizes ethanol from corn so that we can burn food in our cars while poor people starve.) I could go on and on. Why does the government do all these things? Because it has the power to do it, and that power can be bought, and has been.
Of course this system, now that it exists and we are all caught in it, is by no means simple to escape from. But that does not mean it was inevitable, nor that it is good.
Also once "the system" has its claws in you, you can't leave in practice even if its theoretically legally possible. My MiL goes in with stomach upset vomiting urgent care, next thing you know she's getting admitted something to do with gallbladder removal. In theory she legally could have vomited her way out of the hospital with an IV attached into the parking lot to another, cheaper hospital to have her gallbladder removed (or whatever it was) but in practice this isn't happening.
Emergency care, yes, that's unpredictable, and that's the sort of thing that health insurance should cover.
End of life care is not always unpredictable. In fact it rarely is in terms of the general need. Yes, you can't predict the exact point in time at which an 80-year-old person, say, will have an event that makes them require assisted living or a nursing home, but you can certainly foresee well in advance that such a need will arise at some point around that age. So this is not an unexpected need in the sense that emergency care is. And there's no reason why the same health plan should have to cover both needs, yet that is what the US health system does.
> you can't leave in practice even if its theoretically legally possible
Yes, this example of yours is an case of an unexpected need that health insurance should cover. However, I don't know of any "health insurance" in the US that only covers cases of unexpected need like this, and does not also cover everything else that is in any way involved with health care.
The reality is the unified vocational training and the court system and malpractice insurance system and fluidity of employee transfers and government licensing standards mean the variety in care available is more like the difference between McDonalds and Burger King and this aspect is extremely carefully avoided in the debates. Price competition simply will not happen in medical care, theres a lot more required to initiate it than merely messing with the insurance system, it goes very deep.
I think you miss the difficulty of walking out in mid treatment. Yes sure in theory its possible for people to get reservations at three restaurants and eat appetizers and drinks at one, the main meal at the second, and desert at the third. In practice roughly zero people do this even though in the restaurant marketplace they're hopefully not in pain or dying or semi-senile or some other medical distress, and their family isn't panicking. To get the restaurant marketplace analogy correct above, you'd have to use McDonalds, Burger King, and Wendys as your examples, so even if you wandered back and forth between restaurants, the bill would be about the same in the end if not higher on a system perspective from all the paperwork and increased transactional costs. The main, possibly only, effect of playing patient "hot potatoe" would be increasing suffering of sick people.
In other words, regulations, mostly from the government, prevents competition from resulting in variety. I propose to fix it by less regulation--letting more of the benefits of competition be realized. You propose to fix that--how, exactly? With more regulation?
> Price competition simply will not happen in medical care
In the current regulatory regime, you are correct, it won't, because there is no incentive for it. But that's not because price competition is inherently impossible in health care? Or is it because the regulations are removing the incentives for it?
> I think you miss the difficulty of walking out in mid treatment.
I agree that it's hard to change providers in mid treatment when it's urgent, yes. But urgent care is not the only opportunity you have to evaluate providers. In a competitive environment, smart providers would view ordinary care like annual physicals or shots as opportunities to show potential patients their competence, and smart patients would take such opportunities to evaluate the competence of providers. Plus, families and friends can pool information--people do that now. The value of such information is limited now because there is not much choice in the marketplace, yes (hence your McDonalds vs. Burger King analogy). But, once more, why is there such limited choice? Because competition is inherently impossible in this domain? Or because it's regulated out of existence?
> People do not grasp how much of this insanity is codified by law and rule, and when they are informed of it, they shrug it off in the name of "safety."
Not to make minimize the problem, but this feels a bit like privacy in IT (or lack thereof) due to government overreach.
People care much less about something when they are not directly impacted (or think they're not impacted).
A software engineer is hired for their skills (at least ostensibly). No one is required by law to hire someone with a specific degree and specific post-degree training and specific exams.
Contrast this with healthcare. To do certain sorts of procedures, you have to hire a physician. Not because it's demonstrably necessary to have someone with an MD and a residency in such-and-such area do this, but because it's required by law.
As someone else pointed out, this is just the tip of the iceberg. That residency? Residents have no bargaining leverage over their conditions by fiat of residency rules--they cannot leave an abusive residency, for example, to change conditions. Financing the residency itself? Businesses won't cover the expenses because it's not actually worth the costs, so the government foots the bill. And once you leave residency? Well, subspecialty organizations are deciding that it's good to carve out even more regulatory capture with subspecialty credentialing.
People do not grasp how much of this insanity is codified by law and rule, and when they are informed of it, they shrug it off in the name of "safety." It's like terrorism or crime: no one wants to be branded as soft on terrorism or crime, so the government becomes more and more invasive and draconian, and the costs of maintaining the military-police-industrial complex increase and increase. Similarly, no one wants to be soft on safety, so the government becomes more and more invasive and draconian, and the costs of maintaining the medical organization-physician-insurance-industrial complex increase and increase.
There's something disingenuous for physicians to complain about being overworked, and then fight against the things that would alleviate their burden the most: letting perfectly competent professionals with different backgrounds do what they do just as well. But that would mean admitting that you don't need an MD at the apex of healthcare.
To some extent, financial market pressures are doing what I'm saying anyway, as hospitals are realizing that MDs are too expensive as they are. So maybe this is just the first sign of things to come. But the downside of the current system is that administrators aren't allowed to go elsewhere for alternatives, so they just crank up the hours expected of MDs. The upshot is they get devalued without even being given the benefit of being let off the hook.
I guess to address your comment directly: if healthcare were actually a transparent free market, my guess is physician salaries would go down, but their workload would also decrease also. What you'd see instead is much more diversity in who you see for any given service.
The biggest sin of the government in the healthcare debate is willfully ignoring the costs of healthcare, by failing to increase competition, choice, and transparency in pricing. We talk about who pays, but not why we're being charged what we are, and whether or not it's worth it.