Let the Canadian with armour-plated underwear step into the debate:
I understand your collective frustration about insurance companies. What I appreciate the most was the quote regarding the market inefficiencies, and unavoidable externalities that accompany Healthcare.
Quote:
|
Originally Posted by martinguerre
i think about bad health care as a market externality. ustwo, this is for you.
being a good consumer take time. most purchases, a little research will quickly identify some good options, and help a consumer select a good product at a fair price. however, if a system of pricing becomes confusing and byzantine in arcane details....
Then the consumer spends time, time that could be used to make income and be productive, and uses it to secure only minimal gains against a complex pricing scheme. Quality is not being assured by market pressure, since consumers often lack the information to make cogent decisions, and competition is restricted by the urgency which accompanies most health care decisions. Instead of accepting the cost of making health care easier to access and choose levels of care, the current system passes the cost on to the consumer. Lost time equals lost wages. Low and behold, we have ourselves a market inefficiency!
Where's your invisable hand now?
|
How are you to know that the hip replacement you purchased is the best one, or in the economic sense "The Most Efficient"?
You only have two hips. You can only purchase two new ones.
Your hips are unlike another consumers. They may have better or worse hips than you. In this case, no two consumers are the same.
The person performing the hip replacement needs a vast array of instruments, tools, and personnel to assist.
Any number of things can go wrong, and on any given day there are risks involved.
Look what an insurance company brings to the table:
People are risk averse; They want to buy that risk away, and are willing to pay a premium for that service. Medical care can be very expensive, and the costs can be quickly prohibitive when a serious illness is involved. The chances are slim that at any given time you will fall sick. Notice that insurance fits in perfectly here! You pay a fee to avoid the instance where you will be hit with a large penalty.
Hold on.
Doesn't the government require you to have driver's insurance? Isn't there a fine if you get caught driving without insurance? Why is that? Because the risk to the general public is high if you get into an accident and cannot pay for the damage you do.
Hmmm.
If healthcare is a for-profit private industry, why isn't police services, of fire departments?
Hmmm.
What if all of the insurance companies were suddenly gone? What if the government paid the wages and costs associated with health care? The government could capture the profits of private health providers and insurance companies, and take that money and put it back into healthcare. Isn't health insurance just another tax? Aren't you paying someone for the pleasure of having a public service available to you whan you need it? When your employer gives you health insurance coverage as part of your employment contract, is that not just like another corporate tax?
Hmmmm. As a Liberal, I don't mind government being involved in the economy, and providing several services to all of its citizens, whether they can afford to purchase them privately or not. I see the public good that occurs when EVERYONE is covered.
Remember, in order for there to be a good market, the following rules need to be met:
1. Atomicity: There are a large number of small producers and consumers on a given market, each so small that its actions have no significant impact on others. Firms are price takers, meaning that the market sets the price that they must choose.
2. Homogeneity: Goods and services are perfect substitutes; that is, there is no product differentiation.
3. Perfect and Complete information: All firms and consumers know the prices set by all firms.
4. Equal access: All firms have access to production technologies, and resources (including information) are perfectly mobile.
5. Free entry: Any firm may enter or exit the market as it wishes. (See Barriers to entry).
(
link here, wikipedia)
Now, this really doesn't exist (besides agriculture, and there are very good arguments against that) except for an academics scratchpad.
Would you privatize public order? Would the uninsured go without police protection and be banished into a lawless abyss?
Would you privatize municipal services, and only insured people would be allowed to drive on the roads, and walk in lit areas?
I cannot understand why people don't want everyone to have access to Universal Healthcare.
Everyone dies; Everyone gets sick; Everyone will need health services at some point in their lives. You were born in a hospital, and chances are you will die in one.