The UK’s NHS is experiencing another major problem. Patients ‘dying in hospital corridors’ is the headline of a BBC article describing “intolerable conditions” in the country’s government run hospitals. The system’s current problem is blamed on the flu and, of course, government underfunding. That the taxpayers’ funding of the NHS is at an all time high in inflation adjusted pounds is never mentioned. See graph below.
Ten percent of the British population buys their way out of the NHS. They pay their taxes and then purchase private health insurance. Were they not to do so and use the NHS it would come crashing down under the burden of 6.5 million additional patients unsupported by additional revenue. The stark fact is that the NHS will never have enough money as it is a government monopoly that claims to provide unlimited service. Obviously, it doesn’t.
Any good is rationed. We can’t live without food, but how much and what kind we buy is determined by price – ie, it is rationed by price (a free market.). The only ways a government medical system can control costs is either by not providing a service or delaying it. This is rationing by denial or delay.
Think about food and medical care for a moment. You can’t live without food. No food and the mortality rate is 100%. You might live to be 80 or more without ever seeing a doctor or a hospital. Medical care is a lesser good compared to food. So why doesn’t the government own all the food stores and set the prices farmers can charge for their product and provide food to all the population? Better yet, the government could nationalize agriculture. What could go wrong? Ask Ukraine.
Since the NHS is not subject to price rationing, a free market, what incentive does it have to control costs? None. Its response to every crisis is to ask for more money.
The NHS is a good model to predict the effect that a single payer medical system would have in the US. A government monopoly medical system will of necessity lack incentives to run efficiently and with financial regularity. The demand for medical care is virtually limitless, much of this care is discretionary and would be self limited were it subjected to market forces.
It appears that a large segment of the population will never be convinced that the government cannot solve the high cost of medical care. So intertwined with such care is the government at this time that its involvement can never be unraveled. We can look forward to more, not less government involvement with medical care until the whole Rube Goldberg edifice collapses at which time we can start afresh.
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