Wednesday, December 02, 2009

LASIK As a Model for Health Care Reform

Market-based health care solutions are discussed in this video, based on what works quite well in the other five-sixths of the U.S. economy, where choice and competition lead to increases in quality and lower prices over time (electronics, automobiles, clothing, etc.). In one of the few truly market-based areas of health care that is actually consumer-driven (since it's not covered by insurance and patients make direct cash payments) - LASIK eye surgery - there have been market-driven improvements in quality and dramatic reductions in cost, which could be a model for health care reform for other procedures.

Specific recommendations from Reason include:

1. Change the tax code.

2. Scale back state regulations and create a national market for health insurance.

3. Promote Health Savings Accounts (HSAs).

MP: The chart above shows the 42% reduction in LASIK surgery between 1991 and 2009 (in inflation-adjusted 2009 dollars).


At 12/03/2009 12:31 AM, Anonymous Lyle said...

But there is a big difference between LASIK and say a heart attack or cancer. No one needs LASIK, there are equally good alternatives such as eyeglasses. LASIK is a lot like cosmetic surgery in that neither is in general a life saving measure.

At 12/03/2009 2:33 AM, Blogger KO said...

Lyle, how much of medicine is a life saving procedure? Insurance should actually be mainly for those situations - the ones with extreme financial consequences. That's the way other insurance works.

But for routine checkups, tests, sprained ankles, sore throats, etc., why not put the financial decision in the hands of the end user? Right now there's no financial reward for being active and eating right. If you get obese and need drugs, your premium is the same and you just pay a little extra copays.

But let people keep the savings and people are going to try to save money. Right now, would people go to a cheaper doctor that's farther away? Not really if the copay is the same.

At 12/03/2009 10:16 AM, Anonymous morganovich said...


your point it totally irrelevant. it makes absolutely no difference what a procedure is for.

all that matters is that if providers must compete on price and quality, as they do in almost every other product and service, then price goes down and quality goes up.

medicine is increasingly a technology driven business. it's pricing would behave like one if our system didn't completely suppress the price signal and the innovation/efficiency it drives.

At 12/03/2009 5:47 PM, Anonymous Anonymous said...


You point is completely relevant. It makes complete difference what a procedure is for.

The whole point about Lasik should be that the market for procedures of choice act according to standard market norms. Procedures of non-choice (anything life threatening) do not.

At 12/04/2009 4:01 PM, Anonymous Jimmy1920 said...

The idea of consumer price competition in medical care would be laughable if it weren't that people actually beleive it is possible.

Lyle is right. It works for lasik surgery because people pay cash for it. There is another aspect of lasik surgery that sets it apart. The outcome measure is obvious to everyone - you see better or you are blind. Most of medicine is not nearly so clear cut.

Try this on for size. Go to a state like Pennsylvania that has published cost and quality data for well over a decade.

Even there you can not get good data on most of medicine. And where you can, people make all sorts of excuses for high cost, poor outcomes.

At 12/14/2009 8:34 AM, Blogger Paavo said...

And LASIK has changed a lot in that time. They have now better machines and results than they had when I had my LASIK in 2007. It cost 2500€


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