Econoclasm Chapter Two: Medical Economics

You hear all the time politicians and pundits saying that we should let the Free Market ™ work in health care, that Free Market™ solutions are the best. But it should be obvious that Medicine exists in a world even less like Economics 101 than most industries. To begin with, while our basic needs for food, clothing and shelter are predictable and roughly similar for everyone, our n eed for medical services is largely unpredictable, and it varies radically from person to person and time to time. Some people go for decades without really needing any at all, although there are some preventive measures or screening tests that are recommended even for people who think they’re per fectly healthy. Then suddenly, by surprise, people can face medical costs they cannot possibly afford; and the alternative might be horrible suffering, disability, or death.Another major reason Medicine is not like Economics 101 is that Bob knows what kind of food and other goods he likes, and he has some idea how to evaluate the products on offer and compare the prices. In other words he can shop around and exercise his power as a consumer. But for the most part, as consumers of medical services, we can ’t do any of that -- the problem of information asymmetry is extreme.We might have a symptom that bothers us and go to our physician to get it diagnosed, but we have to rely on the physician to tell us what is happening and what to do about it. We might not even have a symptom. We may go for a che...
Source: Stayin' Alive - Category: American Health Source Type: blogs