Re: The market doesn't have an M.D.

Carlos responded to an earlier post with a thoughtful comment, which I thought I'd reproduce here in case you missed it:

Dude, you just opened the healthcare reform door...

So, yes, our healthcare system is incredibly inefficient and wasteful, with spending rising faster than inflation and GDP, while our country's health indicators remain at the bottom of the industrialized world.

Why is it so inefficient? You hit one point on the head: People can not be expected to make good spending decisions regarding health care. If people knew exactly what they needed when they were sick, we wouldn't need doctors! We'd only need a few pharmacologists and a few surgeons who'd set up shop and just fulfill their customer's orders. Also, since many people have health insurance, most are completely unaware or unconcerned about the amount of money that goes in to providing them with care, and so they seek care freely. And health insurance companies distribute payments on a fee-for-service basis, so doctors are incentivised to over-treat so that:

1. They don't get sued.
2. They get as many insurance payouts as possible.

Health insurance companies were initially designed to be the watchdogs of the system. They would make profit by covering as many people as possible, and reduce costs by promoting cheap preventive care and denying payment for unnecessary care. But here, we find that:

1. Insurance companies are not very good at determining what is necessary since they aren't the patient's doctor.
2. It's easier to just assess the riskiness of each potential enrollee and deny "high-risk" customers from the get-go.

So this is where all the "health insurance horror stories" come from. Stories of people getting denied treatment for their fatal cancer. Stories of construction workers getting injured on the job, not being able to work, and being denied private health insurance.

And of course, this is all ignoring the fact that there are millions of people in our country who are completely without any kind of health insurance, and so become exceedingly risk-prone and are unable to get care they need due to prohibitively high costs.

So, what do we do? The government is in the health industry's pocket, and the health industry is benefiting from the status quo, so change is slow, nonexistent, or retrograde. The people suffering the most are the uninsured who are already relatively quiescent in the political realm and are not able to leverage much pressure on the political system. Further, conservatives bust out their best "socialism" fear mongering whenever anyone tries to talk about healthcare reform. And so we wait until the middle class gets pissed off enough with the system that change can be made through the ballot.

What kind of change? Well, that's a whole other rant, but for a quick hint, look at France's health care system.