by Anand Mahadevan

Created on: May 16, 2008

There is a limit to what the market can accomplish. Certain goods and services are of a nature where a free market is just not the best solution and should be in the domain of the government as "public goods". Railways and postal systems are examples. If a postal system were to be driven by market forces, then there would be minimal incentive to deliver letters to vast sections of the land- after all why would a profit making enterprise deliver a letter to Nome, Alaska at the same rate as delivering a letter to NY, NY?

Health care is a similar public good. Consumers are just not in a position to make the right decision in a free market especially given the duplicitous nature of corporations who will do anything in their powers to ensure that the average consumer doesn't have the right kind of information to make a free and informed decision. This has been seen many times already like in the case of the mortgage crisis where ill-informed consumers were convinced by greedy banks and mortgage brokers to take out loans they had no means to repay or as in the dot com boom when investors were suckered into buying stock that had no value based on absurdly high ratings provided by Wall Street firms.
Buying health care is not a trivial task like buying TV's or even a car. It's a complex process with a lifetime impact and has a lot more human component than the TV or car purchase.

Over a period of time, insurance companies, pharmaceutical firms and profit-minded hospitals have done everything to make health care more and more expensive. There has been insufficient regulation of their activities and really the only agency that can put a stop to this is the government.

Which is why I maintain that state sponsored health care with private options available is the only solution to the crisis afflicting this country, one that is spiralling out of control. It is easy to pick out the faults in the British NHS or Canadian public health systems. It is trivial to find isolated examples of people whose health care was delayed because they were on a waiting list of some kind. But one cannot ignore that the majority of people are well served by this system and more importantly the majority of people don't have to worry about a potential bankruptcy because of a health related issue. The peace of mind that is attendant with knowing that there is an option available for free or low cost health care is invaluable. There is a significant comfort in knowing that one's health care is not decided by insurance company drones whose primary remit is to deny any claim that crosses their desk leaving the onus on the claimant to prove the legitimacy of the claim.

A monetary value cannot be ascribed to these aspects of a government sponsored health system.

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