Monday, May 2, 2016

Government-Regulated Health Care in a Nutshell

This graph explains it all, in just one image (H/T: Powerline):

Note in passing that the growth in the number of doctors is far below the corresponding growth in US population over the same period (another figure that has expanded enormously, due to the government's lax policing of our borders).

The correlation is obvious: the more that government regulates health care, the less that smart people want to become doctors who are subject to its dictates -- regardless of how many people might need them.

Under government-regulated health care, doctors are not allowed to set the value of their services in a marketplace composed of their peers who are providing similar services. Instead, the compensation for each service is set arbitrarily so as to be uniform across the board, without regard to the skill or ability of the doctor providing it. (Shades of a government-dictated "minimum wage", anyone?)

Consequently, no individual knows for certain what he or she may earn after so many years of study -- indeed, the "minimum" payment for services keeps going down as total costs increase. And so, why work so hard for an ever-decreasing return, especially when the return will not be based on skill or  invested effort?

The sheer complexity of keeping a lid on government-regulated compensation for all that healthcare (which compensation is euphemistically referred to as "insurance", through sponsored, mandatory  "plans" whose compensatory details are likewise regulated to the nth degree) is the cause of the obscene bulge in administrators, which the graph depicts so vividly.

Folks, like everything else in life, you get the care that you pay for. What the government pays for is bloated bureaucracy and the red tape that bureaucracy generates. Its claims to want to make health care more "affordable" are mere smoke and mirrors: it cannot achieve them, because it is government.

The essence of government is the appropriation and spending, with no accountability, of other people's money.

When money is spent with no accountability for results, the money goes to those who don't want to account for it. And they are the last people to whom you want to entrust your health, your well-being, or your future.


  1. Will we ever see the day when during an in flight medical emergency the cry goes up, "Is there an MBA on board!?"

  2. I have been watching health care and health insurance policy changes for the past twenty years. I am an economist and have seen the kind of problems you've described as the obvious and foreseeable result of government's restriction of our health care freedom. So it has been incredibly frustrating for me to watch this happening, in slow motion, while I have tried to explain the situation to those patient enough to pretend to listen. However, I've been unable to discern any apparent progress from my little personal crusade.

    When I had a very young family of three in Washington State, I had a catastrophic policy with a deductible of $3000 (a lot of money 20 years ago) and paid only $45 a month! I paid out of pocket for our family's health care, which was really inexpensive back then. Then, during the age of Hillarycare(!!) enthusiasm, I watched as our state established a government health insurance plan; and then dictated insurance requirements so high and mandated insurance prices so low that every insurance company left the state's individual insurance market. It was a travesty, and the state government eventually backtracked enough to get insurance companies to offer individual policies again. Only then, the price increased to $300 per month for a similar policy.

    All these years later, state and federal governments have steadily choked off our freedom to get health insurance and health care in an open market. As anyone who is really paying attention would expect, prices are out of control, bureaucracy has multiplied, health care choices have narrowed, and government dictates are ubiquitous.

    There have been serious, freedom-oriented reforms proposed by credible people, and pay-as-you-go is still not forbidden yet (in Texas at least) so I hold out hope for the government to give back much of our healthcare freedom some day. With God, all things are possible.