I meant to respond to this a while ago, but a bunch of things came up, so I’m just now getting around to it.  But anyway, here goes.  In W. Jerome’s post on reducing health care costs, commenter Joe said,

We should stop requiring that people get drivers licenses to be able to drive. The government costs in running DMV’s and driver education programs are completely unnecessary. Driving accidents continue to occur even though so called “licenses” are issued every day.

I’m kidding. I’m just pointing out that you are completely neglecting the concept of safety standards in the name of capitalism and competition. The point is that standards and licensing procedures must be constantly reformed and changed as new problems arise, but never completely done away with. It seems that system you propose would result in a class based system of doctors where the rich get “gold star” doctors and the poor get doctors that by today’s standards would be completely illegitimate.

I realize you probably have a good point to make here, but you must understand the ridiculousness of the idea of a medical free for all.

First of all, comparing drivers licenses to medical licenses just doesn’t make sense. When you drive, you have very little control over whom you are sharing the road with. Having a lot of people driving around without the basic driving skills you need to get a drivers license would make driving more dangerous for everybody. It’s completely different for doctors. If there’s a bad doctor, anybody can choose not to go to her. When we drive, we can’t choose whether or not to interact with inept drivers; when we shop for medical services, we can choose to avoid inept doctors. Now, this doesn’t show that medical licenses don’t make sense and drivers licenses do. It just shows that, in certain respects, medical licenses need to be justified on different grounds than drivers licenses.

As W. Jerome said in his post, I tend to be skeptical of medical licensing. The state-enforced monopoly on medical certification creates artificial scarcity in the medical profession and prohibits a lot of voluntary transactions. Doctors have to go through an enormous amount of training to get their MDs: undergraduate pre-med courses, four years of medical school, residency. Buying services from anybody with this much training is enormously costly. And for many complicated medical procedures, this makes sense. Your really do need tons of training to perform brain surgeries. But for many tasks that doctors commonly perform, this amount of training seems unnecessary. Do you really need eight years of undergrad and graduate training to prescribe drugs, set broken bones, and diagnose basic illnesses? But the American Medical Association actively tries to limit the ability of non-MDs, such as nurse practitioners, to do these things. This results in higher health care costs and huge rents for doctors.

But how would you know the difference between good and bad medical care providers under a health care system without licensing?  Well, for one, the internet makes it much easier to get information about things like this.  Right now, I can go to Google Maps, search for restaurants and other businesses, and find user generated reviews.  There’s no reason why this couldn’t exist for medical care.  I think one reason that it currently doesn’t is that our state-enforced medical licensing system creates a false sense of security among health care consumers.  The fact that the government guarantees the quality of licensed doctors makes it so that the consumer doesn’t have to worry about it as much (although consumers probably still should worry, because we have plenty bad doctors providing care despite the government guarantee).  Having a strong consumer feedback system would give medical care providers a strong incentive to give high quality service.  All that said, there probably is still a place for government regulation of medical care provision, but I think that we would be better off if we moved to a system with lower entry barriers where a body other than the AMA determines licensing standards.

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