The (unpublished!) study Fisman cites does not, as he seems to believe, contradict the Moorian notion that private provision of health care is disfunctional. Rather, it provides one example of why that is so.

It is precisely *because* private insurers are interested in profit, rather than the health of their customers per se, that they need to "recover the costs" of new diabetes patients, and, as a result, systematically provide a poor insurance product. In short, providing a better product would be a money loser.

(It is also why they refuse to cover "pre-existing conditions" or, generally, preventive health care.)

Likewise, the ability to change health-care providers is essential for market competition (just as you can change grocery stores or brands of cereal). To say that somehow this is undermining the market is contradictory--it is the expression of the market.

Now, just because private insurers are not interested in my health per se does not necessarily mean the market will not work. After all, the genius of the "invisible hand" is that even though, say, milk farmers do not care per se whether I like their milk (they are in it for the profit, too) the profit motive drives them to provide stuff I ultimately like.

So, the question remains, why does the invisible hand not seem to work in the health-care sector?

Whatever that reason is, I'm skeptical that the provision of a not-very-attractive (otherwise, everyone would join!) government plan will change much. Seems little more than wishful thinking.

I think you miss the obvious. Most health care insurance is provided by employers not the individuals who use health care. Employers like the insurance companies are also intrested in the bottom line not the health of the individual.

True enough. Employers view heath insurance as a way to attract workers. In this sense, insurance plans are just like wages. And, in the case of wages, employers are certainly not interested primarily in your (the employee's) standard of living--quite the contrary.

However, if your point is that somehow the intervention of employers is the cause of the failure of the invisible hand, I am unconvinced. Or, at least, if so it would be tantamount to arguing that the invisible hand is similarily hobbled in the labor market as whole. Maybe it is, but why?

Or, maybe you think the invisible hand is bunk. I think this is wrong, but it is certainly a consistent position: the health market doesn't work because no market works.

lloyd:

What do you mean, "no market works"? Please explain.

sideriosis,

I think markets work pretty well, in general.

There are obvious exceptions. Such as pollution, which can be viewed as the result of a market "failure". Factories do not have to pay for clean air and water, so left to themselves they use too much of it. We call the result "pollution". The solution to pollution is to impose a market (like the famous "cap and trade" for sulfur or carbon) or simulate the effects of one (through regulation or taxes).

Consider the the health care market. There are three possibilities. This market works just fine (some argue this, but most reject it). This market does not work for some reason having to do with health care (just like pollution, so we can consider a fix). This market does not work, but since (someone might argue--I would not agree) markets generally don't work anyway, there is nothing particular to be done about the health care market specifically.

Let's consider the second option, which is, I think, what most people believe. Then the question becomes: Why does the health-care market not work?

There are a number of possibilites. First, bad luck; health care is just intrinsically expensive by nature, and becoming more so (sort of the anti-electronics). Nothing to be done, really, except hope than the course of technology changes. Second, lawsuits: malpractice suits are driving up costs. The solution is tort reform. Third, bad information. Health care is very complicated (which is why we have highly trained health-care professionals) and, as a result, the customers ("patients") cannot properly shop for health care, and are systematically taken advantage of by these highly trained professionals. One solution, rein in the professionals through regulation.

For various reasons, I don't find any of these very convincing. So, the mystery remains. And the solution remains elusive.

The US health system does not work as an open market because I am not as likely to look for the best deal in doctors as I am in a gallon of milk or even a new car. I might buy whatever milk is closest to me (like the nearest supermarket) or the lowest priced car (best dealership rebate down the road), but if I have cancer I want the best treatment, not the clinic closest to my house or the cheapest inpatient treatment. And once you do get treatment it is impossible to change plans due to pre existing condition clauses. There is no resticion from switching to Toyota if you dislike your Ford.

I think you'll find US insurers are very interested in healthy policy holders since these are the least expensive people to insure. Hence their willingness to fund health club memberships and smoking cessation programs, yet their parsimony when it comes to diabetes supplies and special procedures. All insurance is risk driven and health insurance is no different -- the market favors the least risky pool of insureds.

I doubt that the automobile market would function very well if car dealerships refused to sell cars to poor drivers.

You have to take the profit motive out of medical care.

It's the profit motive that causes millions of Americans to be poisoned by DOCTORS with to many toxic, and unnecessary drugs.

It's the profit motive that causes DOCTORS to injure, and kill millions of patients with premature deployments of unproven medical devices, and drugs.

It's the profit motive that causes millions of patients to be injured, and killed with unnecessary, invasive diagnostic test, and surgery's.

It's the profit motive that allows 47-60 million Americans to have no health insurance. Because it's un-affordable.

It's the profit motive that lets 18-30 thousand Americans die for lack of affordable medical care each year.

It's the profit motive that bankrupts millions of Americans just because they get sick.

It's the profit motive that leaves millions of Americas children unprotected by easily accessible health care.

It's the profit motive that leaves parents afraid to let their children go out to play, or participate in sports for fear they will get hurt and need costly medical care.

It's the profit motive that lets a healthy child die from something as simple as a tooth ache that gets infected and destroys their brain.

HR 676 is the way to go. Before you or your loved ones are next. sickocure.org michaelmoore.com