Comparative Health Care
By Arnold Kling
The Left’s story of health international health care comparisons is the following:
1. The U.S. system is flawed.
2. Other countries’ systems work much better.
3. The U.S. system relies on the free market.
4. There are two systems of health care in the developed world–ours, and the one every other country uses.
I believe (1). It seems as though a favorite debating tactic of people on the Left is to brand their opponents as defenders of the U.S. system. I do not defend it. I see health care policy and regulation as driven by the interests of providers. I think that Americans make extravagant use of medical procedures with high costs and low benefits.
I do not believe (2). (Please don’t cite the “rankings” by the World Health Organization. In large part, they are rankings of how close a country comes to having a socialist system.) There is no health care system that works so well that I would like to see it adopted here. As far as I know, the systems for financing health care are unraveling everywhere.
I do not believe (3). Another favorite debating tactic of the the Left is to say that the flaws of the U.S. system prove that markets do not work in health care. But government pays for close to half of U.S. health care spending–more, if you count things like government employees and the tax subsidy for employer-provided health insurance. Government heavily regulates health insurance. The over-spending and inefficiency that plagues our health care system is quite evident in Medicare and Medicaid.
Government regulates licensing and practice of medicine in ways that promote rent-seeking and ensure inefficiency and fragmentation. Taking all these factors into account, conceivably one might find that ours is one of the *least* market-friendly health systems in the western world.
Which brings me to (4). Other countries have very different health care systems. The UK is centralized. Canada is government-run, but each province manages its own pool of doctors. France is not government run, merely government-paid. All of these countries have consumers paying for some of their health care privately. Thus, there is a lot of variation in other countries’ use of markets in health care. Rather than describe our system as unique, it would be more accurate to describe each country’s health care system as unique.