Reforming healthcare is something that only gets more complicated with time. Rising costs, increased government involvement, and complex insurance policies only compound the problem further. These are problems that have been going on for decades with no clear resolution. But, what about looking at healthcare from an economic standpoint? Can market forces solve the problem?
Noted economists Milton Friedman and Alain Enthoven once sat down to discuss exactly that. The start of the problem, they found, came when employers became primarily responsible for providing healthcare. What started off as government price controls has evolved into the system we have today and there’s no going back. As Friedman puts it, “I’m always fascinated, not about this issue alone, but about so many cases how something gets started for one reason, and ultimately develops into something altogether different and yet, once it develops- you can’t get rid of it. It’s what my wife and I call in the title of one our books, The Tyranny of the Status Quo. It’s much easier to make a mistake then it is to correct a mistake. That’s true for individuals, too. It’s very easy to bang your car up, but it’s not so easy to fix it after you have. So that’s how it got to be the practice of employers.”
So how exactly did this problem start and what can the market do to fix it? Find out in the Free To Choose Media Podcast, Healthcare Reform.