Why is health care so dang expensive? It concerns me to see that the default solution to any problem is more government regulation. Congress seems to love passing more laws, but it never thinks that maybe its mountains of legislation are the source of the problem.
Health care has been riddled with more and more government intervention since the 1960s, and it's no mistake that costs have skyrocketed since President Johnson introduced Medicare and Medicaid.
The U.S. now pays at least $2,000 more for health care per person than any other nation, and the quality isn't significantly higher than in Canada or Europe. While many people think capitalism is to blame, I find it strange that the U.S. health care system in the past 50 years has been anything but free market health care.
What exactly would free market health care look like?
First and foremost, let's get something out of the way. Under a private health care system, those without insurance would not be denied care. It's not a "Let ‘em die if he can't pay!" scenario as the media seems to believe. After doing some research, I found that immediate care would be provided in emergency situations at a direct loss to the hospital. This makes sense because no hospital would want to see "Local hospital lets uninsured homeless man die on the floor" on the front of a newspaper, moral implications aside.
I'd like to zero-in on the cost of service. This is the major concern because the overall goal is affordable and universal health care. Generally speaking, I have come to believe that high costs are the result of the state. I'd wager that a lack of competition is probably the biggest reason for the high cost of insurance. There's simply not much choice when it comes to insurance coverage nowadays.
Government regulations that require fixed-priced standard care packages tend to be more expensive than more innovative insurance packages, which could be made in absence of these laws. Regulations that give way for fraudulent medical billing and malpractice, which outlaw price discrimination as well as hospital subsidies and antitrust laws, seem to cause increased costs on the whole. Not to mention the incurred non-medical bureaucratic and management costs that play a significant role in why health care is so expensive.
That alone was shocking to me. Maybe private systems work better after all, but what about those who still can't afford it - those without insurance? Specifically regarding expensive treatments like kidney dialysis, I found there was historically 1) a shortage of machines which resulted in high costs and demand, and 2) people stayed on dialysis for longer than they should have. The free market allows for new and unrestricted innovation in medical technology, which has been at work driving down costs of machines in the long run.
Free market information systems unabashed by government controls will improve, allowing for more proper diagnosis and treatment.
In conclusion, I think we're jumping the gun a bit with health care. "Who pays for the uninsured that need help?" is probably the last question we should ask.
Private insurance companies and hospitals would shoulder most of the cost from their profit margins. Further, employers, private charities and associations, churches, individual donations and family contributions would be able to foot the rest of the bill.
Especially given the new affordability of care, customer choice and lower costs of technology, I am now confident that everybody would receive cheaper, high-quality treatment. I think we should give private health care a true shot and remove government as far from the picture as possible. It might just save more lives.
David Masten is a mechanical and aerospace engineering freshman at UF.
