Free-Market Health Care?

Won’t work you say? Will cause severe harm to patients without government regulations, you say?

Wrong! Free market health care is the only area of the health care market where prices have actually gone down, while customer satisfaction has gone up. Economist Alex Tabarrok writes,

Laser eye surgery has the highest patient satisfaction ratings of any surgery, it has been performed more than 3 million times in the past decade, it is new, it is high-tech, it has gotten better over time and… laser eye surgery has fallen in price. In 1998 the average price of laser eye surgery was about $2200 per eye. Today the average price is $1350, that’s a decline of 38 percent in nominal terms and slightly more than that after taking into account inflation.

Why the price decline in this market and not others? Could it have something to do with the fact that laser eye surgery is not covered by insurance, not covered by Medicaid or Medicare, and not heavily regulated? Laser eye surgery is one of the few health procedures sold in a free market with price advertising, competition and consumer driven purchases. I’m seeing things more clearly already.

2 Responses to “Free-Market Health Care?”

  • laser eye surgery is elective. it may or may not prove that elective surgery compares with healthcare that is not elective but, rather, necessary.

  • Most uses of current health care is also elective. Competition breeds quality! And the Government could still ensure certain fairness and standards.

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