Bizarro Capitalism in Health Care

Thanks to Tyler Cowen for the link, here is an interesting article where the governor of New Hampshire is basically telling hospitals in his state that they need to stop expanding. A basic principle of macroeconomics is that supply and demand are inversely related.  Only in the health care industry, apparently a world of bizarro capitalism, could increasing supply actually increase demand. 

In fact, this is not a new phenomenon nor is it a novel observation.  Health care resources tend to get concentrated in areas where everyone has access to insurance.  The population in those areas tend to get more health care spending than they need, with no demonstrable increase in outcomes at all.  Spending elsewhere is suboptimal.  The net effect is that distribution of health resources is only tangentially tied to demand, and is certainly inefficient at any rate.

Anyway, sort of related.  I got an email from a friend, which is an email that a med student apparently sent to President Obama.  The student was on his emergency medicine rotation, which is what I am doing this month, so I figured I'd add it.  I end up with a lot of similar sentiments after my shifts in the ED.

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Dear Mr. President:

During my shift in the Emergency Room last night, I had the pleasure of evaluating a patient whose smile revealed an expensive shiny gold tooth, whose body was adorned with a wide assortment of elaborate and costly tattoos, who wore a very expensive brand of tennis shoes and who chatted on a new cellular telephone equipped with a popular musical ringtone.

While glancing over her patient chart, I happened to notice t hat her payer status was listed as "Medicaid"! During my examination of her, the patient informed me that she smokes more than one costly pack of cigarettes every day and somehow still has money to buy pretzels and beer.

And, you and our Congress expect me to pay for this woman's health care? I contend that our nation's "health care crisis" is not the result of a shortage of quality hospitals, doctors or nurses. Rather, it is the result of a "crisis of culture", a culture in which it is perfectly acceptable to spend money on luxuries and vices while refusing to take care of one's self or, heaven forbid, purchase health insurance. It is a culture based in the irresponsible credo that "I can do whatever I want to because someone else will always take care of me".

Once you fix this "culture crisis" that rewards irresponsibility and dependency, you'll be amazed at how quickly our nation's health care difficulties will disappear.

Respectfully,

STARNER JONES, MD