A friend of mine on Facebook criticized the Affordable Care Act (a.k.a. Obamacare) because it is not single-payer system, but lauded it as a step in the right direction nevertheless. Someone else left a comment about how wonderful “free healthcare” is. I responded to the post and comments:
There is no such thing as “free healthcare”. Socialized medicine is not the answer. Government bureaucrats do not know better than the free market, in which individuals engage in voluntary trade for mutual benefit according to their preferences, how to efficiently direct scarce resources to productive ends. Without the market’s pricing system telling entrepreneurs and investors where to direct resources to satisfy consumer demand, decisions about where to direct them are made at best arbitrarily, assuming good intentions of politicians, or, worse, for corrupt reasons, such as to shower benefits on one special interest group at the expense of everyone else.
The incentive for health care providers competing in a free market system for a customer’s business is to provide the best possible care for the lowest possible cost. When you eliminate that freedom, incentives become perverted. This is why health care is so unaffordable in the U.S.
Due to government interference in the market in just about every way imaginable, including the role of the FDA, it is geared towards benefiting the special interest groups of Big Pharma and the insurance industry, and doctors no longer treat diseases, but instead the symptoms, such as by putting people on an expensive drug for the rest of their lives instead of directing them to get proper nutrition, etc. The incentive becomes not to provide the best care, but to NOT heal people and instead make them permanent customers who are never cured of their ailments, just drugged up so they can live with the symptoms, which drugs have side effects requiring even more drugs to treat those new symptoms, and so on.
The so-called “Affordable Care Act” doesn’t do anything to address the rising costs of health care. It only exacerbates the underlying problems with perverse incentives, such as punishing people who choose to eat a healthful diet and exercise by making them subsidize the costs of care for those who choose unhealthy lifestyles.
This is the whole purpose of the individual mandate, to force young, healthy people to subsidize the costs of care for those requiring it.
This was deemed necessary because the requirement that providers insure everyone, even if they already have an existing condition requiring expensive care, which defeats the purpose of insurance (imagine requiring fire insurance providers to insure everyone, even if their house has already burned down). This creates the perverse incentive for people not to purchase insurance unless and until they get sick, thus exacerbating the problem of people not being insured and causing rising premiums for those who are.
This requirement in turn was deemed necessary because of the large numbers of people unable to get insurance due to a preexisting condition, which was in turn exacerbated by government interference in the market, with subsidies for employer-provided insurance that is non-transferable, meaning you can’t take it with you from job to job, unlike individual policies.
The third-party payer system itself causes many problems, such as being unable to choose your doctor from all those available, but being limited to coverage only within the provider’s network (the doctor in the above video pretty was being disingenuous when he denied this by saying you could still choose; yes, but it’s a more limited choice). Insurance companies work out arrangements with health care providers for prices such that health care becomes “one size fits all” and prices become distorted such that the price paid for a particular form of care is different based not on how much it actually costs, but just who is paying. The hospital’s client under this system is not the patient, but the insurance company. The doctor-patient relationship is broken, and the idea of individualized care is out the window, along with market prices.
The high costs of health care in the U.S. are a consequence of government interference in the market. Thus, it is evident that even more government interference cannot possibly be the answer.
That prompted the following rather humorous conversation with “Matt”:
Matt: When you put a price on life you aren’t a good person. There should be no profit in illness.
Me: You must be kidding. So doctors should not be compensated for their time and labor? Who would ever want to become a doctor in this system you are dreaming of?
Matt: Clearly you don’t know what you’re talking about as it doesn’t take a massive medical bill for a doctor to make a living.
Me: How do you propose a doctor makes a living if he is to receive no compensation for his time and labor?
Matt: I never said they receive no compensation, did I?
Me: Yes, you did. You said you shouldn’t put a price on life because that’s not being a good person, and that there should be no profit. Ergo, logically, you are saying that doctors should work without compensation.
Matt: Ergo you no not what ‘logically’ means.
Me: Explain. Tell me, Matt, how it can be true that doctors may not profit and yet at the same time also true that they receive compensation for their time and labors. Clearly, the one who has a problem with logic here is you.
Matt: When I say profit I mean gross profits. I at no point said a doctor shouldn’t be paid. A system such as ours in the U.K where doctors are paid by the Government is what I propose. But of course I’m sure you will see this as “evil socialism”
Me: So you think doctors should be paid? Correct?
Matt: Yes, doctors should be paid, but no all healthcare is about doctors, it’s about meds and how much they cost. If Obama really wanted to help people afford healthcare he could just reverse what Bush did that allowed big pharma to stick any old crazy price on their meds.
Me: Okay, so you think doctors should be paid, but not to make any profits. Correct?
Me: I’m trying to understand you, Matt. Help me out here. You said there should be no profit. Then you said doctors should be paid. I’m trying to figure out how that works in your mind.
Matt: Profit is not made by the doctor, it is made by the hospital/pharma company – doctors get paid for their work …. and on the side in the U.S get money to pimp unneeded pills for profit. Cancer sufferers are forced to pay crazy amounts per month just to stay alive or without pain. If you can’t understand the simpleness of this then I’ll reduce it to something you must be able to understand: You are wrong, socialized medicine is the only way forward People before profit.
Me: How can it be true that profit is not made by the doctor and yet also true at the same time that doctors get paid for their work? If doctors receive no profit, how do they make a living? Do they all live on welfare in the U.K.?
Matt and I can agree on at least one thing: his thinking on health care is indeed “simple”. I went to Matt’s profile, and his banner image is of the British parliament building burning, with the words “I absolutely Fucking Hate this government.” How ironic.
Apart from being amusing to me, the reason I’m posting this is because it offers an instructive example of how people claiming to want socialism instead of the free market have absolutely no concept of what either is. People like to spout these words that to them sound good and they take up positions on issues based on some feel-good idealogical basis, but they don’t bother to actually take the time to think through the logical implications of their own ideas.
It’s pretty frightening to me, actually. This is why democracy, i.e., mob rule, is such a dangerous idea.
I was just getting ready to post the above when someone else jumped in. Here is my discussion with “Wayne”:
Wayne: Jeremy, you are obviously a very well educated young man, so i suggest you do some research on this matter further. But to answer a question, Doctors are very, very well payed & make a fantastic living here, you obviously have your wires crossed because nothing is being sold to make a profit, they receive substantial salaries for all their hard work. 1 more point, National Health contributions are are very small, & I would rather give up 5% of my income to help everybody, than give up 30%-50% of my income to help myself, only to be denied payment on my HMO for life saving treatment because I had an ear infection when i was 16 & forgot to mention it on the HMO form when applying for cover.
Me: Wayne, to say “nothing is being sold to make a profit, they receive substantial salaries for all their hard work” is a self-contradiction. Both can’t be true. If they receive substantial salaries for all their hard work, they are by definition profiting from selling their services to their customers. How else could doctors make a living if they received no profit? Why would anyone want to become a doctor if there was no profit in it?
Wayne: well in that case, you answer your own question you asked umpteenth times above!
Me: I don’t know what you are referring to.
Wayne: Count how many times you ask if the doctors make a profit in your comments above, you basically refer to it in all of them.
Me: Yes. Is it not clear to you why I repeatedly asked Matt this question?
Wayne: Definition of ‘Profit’ A financial benefit that is realized when the amount of revenue gained from a business activity exceeds the expenses, costs and taxes needed to sustain the activity. Any profit that is gained goes to the business’s owners, who may or may not decide to spend it on the business. Does this apply to Doctors salaries? I dont think so, they get paid for a service.
Me: Profit: “net income usually for a given period of time” Applies to doctors’ salaires.
Wayne: You obviously think that HMO’s are a better system, I personally dont, thank you for the chat
Me: I’m curious whether you could discuss this matter further without feeling it necessary to create strawman arguments in order to defend your own view.
Wayne: nearly 30 posts & we cannot agree the difference between profits & salaries so obviously I cant lol
Me: You disagree with Merriam-Webster’s 3rd definition of “profit”?
Man, this is just too much fun. I’m wasting time at this point and need to get back to work. But it is always an educational experience trying to reason with irrational people.