Wednesday, July 22, 2009

Health Care is NOT a Public Service

Is health care a pubic or a private service?

That is the soul of the issue, what we should really be talking about. Those in favor of single-payer plans, socialized medicine, medical welfare, etc. all believe that health care is a public service, like the police or the fire departments. Those in favor of market solutions believe health care is a private service. There can be no agreement on what to do with health care coverage unless and until we settle this issue.

The police and fire departments are public services. There's little debate about that, except among anarchocapitalists. The rest of us agree that these are public services which the government rightly provides for us. They are public services because the public as a whole benefits from these services, yet individuals are unlikely to pay for those services which they don't typically receive. How often do we really need the services of the fire or police departments? Yet, we want them there when we need them. They have to be funded in the meantime, and public funding seems the most effective and efficient way of paying for these services.

The question then is: will hospitals and clinics and independent doctors exist without government funding. The fact that they do answers that question. Health care is a service that individuals seek out for their own benefit. Enough people do so on a regular basis that hospitals, etc. can exist without public funding. Anyone with even the smallest amount of knowledge of economics understand that if something can exist without public funding, it should continue to exist without it, as that is the most efficient, cost-effective way of providing the service.

The fact that someone might need the service at some time is no justification for it being a public service. Everyone needs food to live, but grocery stores and restaurants are not public service -- they are private services. Yes, food is necessary for our survival, but that fact is insufficient to make the service of providing food a public one.

There is also this wrongheaded notion that doctors should only be doctors if they are truly service-minded. People should be paid what they are worth, and doctors provide a rare, difficult-to-learn service. If there is more demand than supply, one would expect prices to be relatively high, to reflect that balance. I am sure that we could find people out there who would be willing to be doctors if they received a free education to become a doctor and who would only receive a middle-class wage once they became a doctor, but are those really the only people we want to become doctors? What would be the incentive to specialize? Further, would yuo find more or fewer people becoming doctors in such a system? Any clearheaded person would answer the obvious: fewer. Thus we would end up with fewer doctors for more patients, creating long waits fo all kinds of medical services. Give me a system that attracts people into medicine and specializations based on the draw of high wages any time. That will ensure a high number of doctors and specialists. Of course, as the supply of doctors increases due to the attraction of high wages, the prices of their services will drop. But we need to make sure there are few barriers to entry to ensure this high supply of doctors. Those doctors who are truly community-minded are also free to open up free clinics, or discounted clinics, to provide care to the poor. Such generosity is to be admired -- but the desire to make a good wage isn't something that should be denigraded just because we admire the generous.

So health care is absolutely not a public service. The fact that it can and does exist without government support alone provides evidence for this fact. Prices are the most efficient way of determine how health care is to be provided. Nor should it be a public service, as turning it into one makes for passive inefficiencies, long waits, shortages, and other problems associated with government-provided private services. In fact, every time the government tries to turn a private service into a public one, we get inefficiencies, long waits, shortages, etc. We saw it with food distribution in the Soviet Union, and we see it with socialized health care systems in places like Canada and Great Britain.
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