Liberty in Health Care

The unregulated market is the basis of every free and successful society. Unrestricted trade has enabled competition among men to produce the best goods and services using the most efficient means. Why then, should health services be treated any differently?

President Clinton's plan for health care reform through "managed competition" is flawed to the very core. The only effective solution to the health care crisis is to allow the market for medical services to function freely, unconstrained by destructive regulation and financially draining responsibility shifting.

The key to the market solution is ending the health care monopoly--not through an antitrust policy, but by simply abandoning the restrictions which have made and encouraged that monopoly.

To a large extent, regulation is responsible for our health care crisis. This regulation comes in the form of government support of one of the most powerful monopolies in the history of the United States: the American Medical Association (AMA).

The federal government requires that all medical schools be accredited, and it allows the AMA effectively to decide which schools receive approval for accreditation. This means the AMA is actively able to limit the number of practicing physicians in the United States. When consumer demand outweighs the number of doctors available, the rates for medical services rise, and people do not receive the care they need.


A drastic fall in the number of general practitioners is a further consequence of the AMA's control of medical students. As new areas of medicine open up to study, more students opt to specialize rather than to train for general medicine. Thus, the number of doctors is held roughly fixed while the number of students who actually stay with general medicine has fallen over the years. The percentage of students who enter general medicine has fallen to a record low of less than 15 percent, and general medicine is an area where the nation desperately needs more practitioners.

New medical schools should be permitted to train the additional doctors necessary to meet the demands of Americans. Clinical programs such as those currently operating at several hospitals across the nation could become the basis for an efficient alternative form of schooling. At the same, new medical schools of the traditional form might open to further research efforts and theoretical medicine. Most importantly, doctors should be able to practice medicine without AMA accreditation.

Opponents of a market health care system claim that if the number of doctors were to increase because of a relaxation of government regulations, the quality of doctors and the care they provided would suffer. But certification does not necessarily equal quality. A slight slip of the scalpel can occur even to a board-certified physician. Likewise, a degree from a newer medical school does not preclude high performance.

Should new schools be allowed to open, they would have a very strong incentive to train competent physicians. If they failed, the number of applicants they attracted would decrease, and the schools might eventually have to close. If they succeeded, they would attract better students and superior faculty members.

Even if every one of these new doctors would not be able to perform brain surgery, he would still be able to set a cast or give a tetanus shot. Indeed, it is the demand for these most basic medical services that is increasingly going unmet because of government regulations.

Although physicians would no longer be certified by the government, certain standards for medicine would evolve. Just as the private Underwriter's Laboratories certify the quality of electronics products, so might a private medical certification program form--a program that would enable consumers to better judge the quality of physicians who had received widely varied forms of training.

The difference is, the program would be entirely voluntary. If doctors were not certified, they could still practice. Perhaps those doctors would not receive many "customers." On the other hand, some might fill a niche in the health care market for lower-income consumers or for those who preferred alternative forms of medical treatment.

Doctors would still be able to receive private certification that illustrated the level of studies they had completed. Thus, they could demonstrate that their training was equal to any AMA-certified physician. In addition, many levels of certification would open up above and beneath this level.

The integrity of each certifying agent would ensure that its doctors were sufficiently competent and qualified. If the certification process were to become corrupt, doctors would abandon the certifying agent in favor of a another. Today, the government as a certifying agent is bound by no such constraints of integrity.

Free market health care might very well mean a poorer person would not be able to afford the best physician. However, as Milton Friedman argued in Free to Choose, why shouldn't people receive the services of the Chevrolet of the medical profession simply because they cannot pay for Cadillacs?

Turning health care over to the market would place the responsibility for provision of medical care where it belongs: with doctors and patients. Doctors would have to provide the best services for the lowest cost possible. Patients would be responsible only for their own medical needs, not for those of others, and would make the most economical decisions concerning the services they would choose.

The only way to fully address the problems with our health care system is to attack its core. By removing the restrictions that enable the AMA to retain a monopoly on health care, we could successfully put America's health care crises in the past.

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