Dec 06, 2018

Our Health Care Will Improve With Two Key Ingredients: Competition and Choice

Post by Freedom Partners

The Department of Health and Human Services released a report Dec. 3 about how the federal government and the states might promote health care competition — and what reforms it will pursue in the coming year.

In addition, HHS’s Alex Azar and Brian Blase of the National Economic Council spoke at the American Enterprise Institute on Tuesday to discuss barriers to affordable care and how they can be overcome with greater choice and competition.

America has tried regulating health care to increase its availability and quality — but that hasn’t worked.

Indeed, it has produced precisely the opposite of its intended effects: Costs have skyrocketed as supply has shrunk, often leaving millions of Americans with poorer health care outcomes. Meanwhile, draconian regulations on health insurance, not least Obamacare, have forced countless Americans into prohibitively expensive policies — or else forcing them to go without insurance entirely.

The solution to our country’s health care problems can’t be found in greater government control, but rather in competition and choice, an approach now pursued by the Trump administration.

“Government policy represents the main reason that choice and competition are suffocated in health care markets,” Blase said.

But, as Azar later noted, many of these reforms must be undertaken by the states, which “impose a thicket of regulations that drive up the cost of providing care.” Thirty-five states have certificate-of-need laws, which hike costs and reduce the supply of care by limiting the number of providers in a certain area and blocking expansion of services.

Many care providers, who would like to offer more services to patients at lower prices, are told they aren’t allowed by the state government, which has already granted monopoly privileges to another provider. As a result, common and necessary services like X-rays and MRIs often break the bank for many Americans.

What’s more, restrictive scope-of-practice laws at the state level — which limit the number of services that nurses, physician’s assistants and pharmacists can offer — make it difficult for health care providers to, well, provide care. After all, when the government tells providers that they can’t offer services for which they are eminently qualified, patients suffer. In many cases, this means that many Americans in rural areas must drive hours to see a doctor, even when a qualified nurse is nearby.

That’s the effect of onerous government regulations at work.

Thankfully, the Trump administration has worked hard to reintroduce choice and competition to the market, alleviating the problems of restricted supply and high costs from the industry.

It’s encouraging to see that the administration plans to bring enhanced openness to the market in 2019. Our health care system requires less of a heavy hand from government, more of the doctor-patient relationship and greater openness. That is the way to provide more Americans quality, affordable care.