Friday, March 24, 2017

There never can be a free market in health care

I submitted the following comment to David Brooks “The Trump Elite. Like the Old Elite, but Worse”, New York Times, 2014-03-24, http://www.nytimes.com/2017/03/24/opinion/the-trump-elite-like-the-old-elite-but-worse.html?comments#permid=21912241. (Warning, my comment is buried among several others.)

There never can be a "free market" in health care.  Sure the sellers are free to leave the market, but few of the buyers are free to leave the market.

Let's hope it doesn't happen to you, but suppose you are in a car crash on a rural road.  First responders find you unconscious and decide to send you to a big city hospital rather than the nearest small town hospital.  Depending on the severity of your injuries, they call an ambulance (very expensive) or a helicopter (really expensive).  Oh yes, there is no free market in either because there are not many sellers of either, not many being only one.

There can be a free market in insurance providers, but how free a market is there when only five or six providers in your market?