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Free Market Medicine
by James W. Brook
by James W. Brook
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The problem of health care for the uninsured has been solved. The
solution, as usual, lies in free markets. We have not had a free market in
health care for many decades.
I am actually a part of a small, but growing, movement of doctors
who have "opted out" of the third-party payment system and simply charge
patients directly. No insurance contracts, no medicare, no medicaid, just
direct payment at the time of service, from the person who receives the
service.
The results? Throughout June and July of this year, my average
charge was $37 per patient. Sounds affordable? Well, get this - that fee
includes housecalls, some antibiotics and other medications dispensed, and lab
fees.
Wait a minute, did that guy just say housecalls? Nobody does
housecalls any more! Well, a doctor who employs free market principles can
provide the kind of care that a patient wants, including housecalls. The
patient is the customer, not the insurance company or the taxpayer.
By not contracting with third parties for payment, I do not have
the kind of overhead that is needed to contend with those bureaucrats. Medical
Economics magazine pegged the annual overhead for a family physician without
obstetrics at roughly $272,000 per year in 2003. Mine is less than one tenth of
that. A typical FP collects about 60% of his charges. I have collected 101%,
due to tips. Yes, patients frequently tip me.
I calculated that if I charge $30 for something now, in order to
come out the same, I would need to charge $107 if I had the same financial
constraints as most doctors. I would have an extra $34 in overhead per patient,
raising the fee to $64. Then to collect that $64, I would have to charge $107.
I can also offer generally same-day service, flexible hours, and
adequate time with patients. I charge by time, so I am not financially
pressured to gloss over issues or reschedule for later. I have even combined my
office with my home. I call this Modern Medical Care with Old Time Service.
I am not really the first to be doing this; it was the typical
practice model decades ago. There is a group of physicians, the Association of
American Physicians and Surgeons, comprised of many like-minded doctors, that
advocates just this sort of practice.
As far as morality is concerned, the free market approach is
supremely ethical. Nobody has money confiscated from them, under threat of
deadly force, to pay my fees for somebody else's health care. That is the way
Medicaid and Medicare work. My patients willingly pay me, and for the most
part, they seem very grateful for the service they get.
One might think that America has free market health care, and that
is our problem. After all, we are the only developed nation that yet lacks
socialized medicine. How blessed we actually are, that we have not become
completely socialized. After all, Canada's own supreme court ruled in 2005 that
their prohibition on private care "interferes with life and security of the
person as protected by s. 7 of the [Canadian] Charter." That was because people
were dying on waiting lists.
So where do we lack for free markets? First, health insurance
premiums are tax deductible if paid by employers, and now the tax deductibility
has expanded with health savings accounts. This makes health benefits much more
valuable than salary, skewing the perceived cost of health care.
Next, welfare programs such as Medicare, Medicaid, and the State
Children's Health Initiative Program now are the payors of over 50% of health
care dollars. The massive sets of regulations that they have spawned have been
adopted by private insurers.
The Food and Drug Administration blocks entry of effective new
drugs into the market for many years, and drives the cost of developing a new
drug to about $800 million. While the sale of drugs is being blocked, people
are suffering and dying.
The Drug Enforcement Administration, Clinical Laboratories
Improvement Amendments, Emergency Medical Treatment and Active Labor Act,
Health Insurance Portability and Accountability Act, Stark laws, state-mandated
insurance coverage for specific services, abuse of court power through
malpractice, and even licensure itself, all combine to tie the health care
industry into knots of red tape. There is very little free market at all left.
The ray of hope shining through our fog of government interference
is found in the doctors who choose to stay as far out of it as they can. We are
not a large percentage of doctors, but we are becoming more known. We can try
to influence other doctors to do the same. We can try to educate the citizenry.
We can try to slow down the advancement of socialism in the halls of
government.
The free market is the most moral and effective approach to health
care, as it is to our other economic activities. It has brought better goods
and services to people than any other system. It is time we restored free
markets in medicine. Health care is much too important to let government
continue to mess it up.
August 4, 2006
James W. Brook, D.O. [send him mail], who is board certified in
family practice, practices in Idaho Falls, Idaho.
Copyright © 2006 LewRockwell.com
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