The idea that healthcare services should be delivered on the basis of the free market profit motive is just plain crazy. Even my “friend” David Axelrod at the White House, minces too many words in the memo he sent me today , “Something worth forwarding”.
This should be most obvious to those who believe most deeply in the profit motive. The profit motive says that people, including healthcare providers of all sorts, will market their services in order to obtain the highest possible return on their investment by charging whatever the market will bear (and it will bear a great deal to those who are sick).
Healthcare workers will push for the highest return on their labor. Nurses will push for the highest return on their services. Doctors will push for the highest return on their knowledge and skill. Hospitals will push for the highest return on their facilities. Drug manufacturers will push for the highest return on their chemistry. Medical equipment manufactures will push for the highest return on their hardware. Medical insurance companies will push for the highest return on their promises.
When taken as a whole, the profit motive assures that those in need of care pay the highest possible price for the least possible care.
With everyone looking to maximize profit . . .
- Everyone will will create scarcity of their product and service to drive up price.
- Everyone will avoid providing unprofitable product and service (basic care) and maximize demand for profitable product and service (Viagra pills and breast enlargement).
- Everyone will sacrifice quality of service to reduce cost.
- Everyone will calculate their success based on dollars rather than care and cure.
- Everyone will push other healthcare workers to work longer hours, serving more patients, for lesser salaries.
- Effective healthcare will be reserved only for those who are willing and able to pay top dollar.
- Everyone will do their very best to gain by charging more for less.
This is essence of the profit motive and in the end, a few get richer while the sick get sicker. If you want healthcare that makes you healthier, get rid of the profit motive!1
TAKE MY “WHERE DO YOU STAND ON HEALTHCARE” DIAGNOSTIC TEST
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- To remove the profit motive simply calculate the cost of a service and add to that a reasonable and equitable rate of return for those providing that service. This becomes the optimal basis for determining the total cost of a service. In the case of high cost essential services, offset these by pricing non-essential services at a higher rate. To guarantee universal service at the lowest possible overall cost, spread the risk pool to cover everyone. Make a healthy nation a matter of profit, patriotism, and pride, by which everyone gains. ↩
