Thursday, July 30, 2009

The Myth of America's "Free Market" Health Care: It's Free Market The Same Way Madonna is A Virgin

Both ObamaCare's supporters and opponents believe that--unlike Europe--America has something called a free market health care system. So long as this myth holds sway, it will be exceedingly difficult to prescribe free market fixes to America's health care woes--or, conversely, end the lure of big government remedies.

The fact of the matter is that America's health care system is like a free market in the same way that Madonna is like a virgin--i.e. in fiction only. If anything, the U.S. system has many more similarities than differences with France and Germany. The only big outlier among European nations is England, which, even in a post-communist world, has managed the impressive feat of hanging on to a socialized, single-payer model. This means that the U.K. government doesn't just pays for medical services but actually owns and operates the hospitals that provide them. English doctors are government employees!


But apart from England, most European countries have a public-private blend, not unlike what we have in the U.S.

The major difference between America and Europe of course is that America does not guarantee universal health insurance whereas Europe does. But this is not as big a deal as it might seem. Uncle Sam, along with state governments, still picks up nearly half of the country's $2.5 trillion annual health care tab.

More importantly, contrary to popular mythology, America does offer public care of sorts. It directly covers about a third of all Americans through Medicare (the public program for the elderly) and Medicaid (the public program for the poor). But it also indirectly covers the uninsured by--at least in part--paying for their emergency care. In effect, anyone in America who does not have private insurance is on the government dole in one way or another.

~"The Myth of Free Market Healthcare in America," Shikha Dalmia

9 Comments:

At 7/31/2009 7:00 AM, Anonymous CompEng said...

Thank you for posting this. I've been waiting for someone to say it.

 
At 7/31/2009 10:00 AM, Anonymous Dave said...

It seems to me that the current American health care system is so frightening that when physicians earn their medical degrees as part of a U.S. military package deal, their mothers advise them to stay in the military, where, as military doctors, they are less likely to be sued for malpractice.

 
At 7/31/2009 10:50 AM, Blogger Size said...

Dave,

H.R. 3200 does absolutely nothing to curb malpractice suits. That's the deal they cut with trial lawyers. But doctors will be paid less. So, I'm sure we won't have a shortage of doctors or anything.

 
At 7/31/2009 1:09 PM, Blogger Public Library said...

And the same way America is a "Free Market" economy.

 
At 7/31/2009 9:58 PM, Blogger QT said...

Mark,

An article for your consideration. It seems to cut to the heart of the economic and political dynamics of Obamacare.

 
At 8/01/2009 10:14 AM, Blogger 1 said...

Its kind of sad that we have keep redefining the phrase, 'free market' in this country that capitalism built...

Personally I completely disagree with the commentary of Ms. Dalmia...

Like most things American 'free market health care' is a relative situation...

Apparently Ms. Dalmia couldn't be bothered to mention that compared to her country of origin, India has nationalized health insurance in play...

Comparatively speaking our present day health care system such as it is, is quite bit more free market than India...

Ms. Dalmia alluding to the study from the liberal David Green founder of the Civitas think tank didn't help her attempt at rationalizing her point of view at all as far as I was concerned...

From John Lott's web site: Fox News poll indicates that 27 million without health insurance

 
At 8/02/2009 7:08 PM, Anonymous Anonymous said...

Our "free market" economy has government at somewhere under 25% of GDP (rockecting upwards as we speak of course). Healthcare has way more government intervention than that (upwards of 40%) so its completely fair to point this out. Yes even by American mixed-economy standards our healthcare is already very socialized.

 
At 8/02/2009 9:42 PM, Anonymous Mika said...

Dalmis presents a very weak, if not totally bogus, argument. In fact, the health insurance industry has free range in governing - including rejecting and overpricing - the health coverage and care of most Americans. Just because those without that insurance have a governmental safety net, doesn't mean the health insurance industry is not functioning freely in a free market.

 
At 8/03/2009 10:02 AM, Blogger Methinks said...

In fact, the health insurance industry has free range in governing - including rejecting and overpricing - the health coverage and care of most Americans.

That's true. But that's because state regulators have impeded competition by not allowing an interstate market in health insurance. This creates insurance monopolies and oligopolies and the freedom to charge what they want. There is no free market at all in health insurance and prices have not been forced down by the hell-fire of competition.

Also, state legislators pile on the expensive mandates, raising the minimum insurance and minimum prices insurers in the state can charge. Mandates are why had to pay $1,100/month in NY and could buy a $427/month policy when I moved to CT.

 

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