The Biggest Lie About National Health Care

One of the most prominent arguments against national health care systems is that they reduce the power of doctors to determine treatments and increase the power of government bureaucrats. This is a false choice, since in the private market it is not doctors, but insurance company bureaucrats who determine which treatments will be paid for. The question is not between doctors and bureaucrats, but between government bureaucrats and private insurance company bureaucrats. So which is better? Benjamin Radcliffe gives an admirably succinct argument that government bureaucrats have a much better incentive structure to promote public health:

A rational agent might well deduce that government bureaucrats are preferable, since at least (a) they have no business incentive to deny care, because they are not making profits by minimizing your access, and (b) they are subject to the enormous political pressure that citizens exert on government to fund and administer Medicare in a conscientious fashion, overseen by elected representatives whose political careers depend upon maintaining public support, while the insurance company bureaucrat is (1) actively charged with minimizing the care provided so as to maximize corporate profit and (2) is answerable to no one but a purely private, profit-driven corporation. (The Political Economy of Human Happiness, 2013, Kindle Locations 1650-1654)

Neither system is perfect, but one of my biggest frustrations with the debates I wind up in is the assumption that removing government regulations increases the power of ordinary citizens. As I’ve pointed out earlier, that’s not true of the labor market, and it’s not true of the health care market either. Citizens are subject to a number of different forces when negotiating for wages and benefits and when getting health care. Government, imperfect though it is, at least doesn’t have an active monetary incentive to increase its own profits by negotiating lower wages or denying health care claims.


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