Paying for healthcare
18th October 2009
There is an obvious alternative. We could pay for our medical treatment the same way that we pay for our cars or our food or a roof over our heads: out of our own pockets. Before rejecting the idea out of hand, at least acknowledge that it would encourage us to ask a very different set of questions, including: “is there a cheaper way that would work?”, “can I get better value treatment elsewhere?”, and even “would I save money if I drank less and exercised more?” The effect on cost and quality would be bracing.
We do pay for healthcare. If you have an individual plan, you can see the rapid inflation before your very eyes. If you don’t, your employer provided plan has probably decreased in quality, and there is an argument that the cost of the plan to the employer is one main reason for wage stagnation (in other words, the cost of the employee included healthcare). There are issues with assuming that purchasing healthcare is analogous to purchasing food. But it is true that people do not as individuals (the doctor and the patient) make decisions which minimize costs because there are no incentives to do so.