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Q: Why don't we have a free-market health-care system? A: Ronald Reagan

Thanks to conuly and siderea for this link.

The U.S. used to have a free-market health-care system in which you got what you paid for. Problem was, people who couldn't pay for health care didn't get it: they were turned away from emergency rooms, or treated briefly and immediately "dumped" onto other hospitals or the street, with predictably bad health outcomes. Pregnant women gave birth on the doorsteps of emergency rooms that wouldn't let them inside. This didn't look good for one of the world's richest nations.

So the well-known Socialist Ronald Reagan signed the Emergency Medical Treatment and Active Labor Act of 1986 forbidding most hospital emergency rooms to turn anybody away for inability to pay, or to "dump" patients who still needed urgent care. Problem was, the act provided no funding -- it was, in Reagan's words, an "unfunded mandate" -- so hospitals were on their own to figure out how to pay for care for all these indigent patients. Taxpayer-funded hospitals asked for more tax dollars; the rest had to charge everyone else more, double-charge Medicare and Medicaid, invent "facility fees", etc.

By guaranteeing emergency care to everyone, regardless of citizenship, insurance, or ability to pay, Reagan socialized the low end of health care: poor people's emergency health care was paid for by everyone else. Routine and preventive health care were not, so they naturally became rare luxuries for poor people. Since "an ounce of prevention is worth a pound of cure," total health care costs went up. Meanwhile, the high end was still a privatized Wild West, in which insurers could make a good profit by picking just the right people to insure and leaving the rest to fend for themselves in the E.R.

The result was the "worst of both worlds" health care system we've had for decades now, in which medical bills bear no relationship either to the provider's actual costs or what the provider expects to actually be paid, large numbers of people get their routine care from emergency rooms at exorbitant cost to the public, and the total money spent per capita is twice what it is in any other country in the world.

There are several ways we can go from here. We can re-privatize the low end (e.g. by repealing EMTALA), or we can partially socialize the high end (e.g. by requiring everybody to be insured -- although a single-payer plan would do this more effectively and efficiently). Or we can go on using taxpayer dollars to subsidize insurance company profits.


This, along with orphan drugs, was one of the real world issues that the TV show "Quincy" took on back when it was live.