Health

"Supply-side health care"

John Cochrane:

Fixing the supply of health care strikes me as the policy win-win. Instead of the standard left-right screaming match, "we're spending too much," "you heartless monster, people will die," a more competitive health care market giving us better service at lower cost, making a cash market possible, makes everyone's goals come closer. . . .

One pattern I see is that lack of competition is necessary to buck up government-mandated cross-subsidies. (Previous posts here and here.) The government mandates that hospitals cover indigent care, and medicare and medicaid below cost. The government doesn't want to raise taxes to pay for it. So the government allows hospitals to overcharge insurance (i.e. you and me, eventually). But overcharges can't withstand competition, so the government allows, encourages, and even requires strong limits on competition.