You get what you pay for

Don Boudreaux quotes Tom Miller on Medicare (emphasis mine):

Aside from the basic numbers of budgetary imbalances and continuing fiscal pressures, Medicare’s institutionalization as the dominant payer in US health care also has locked in the worst features of a costly and inefficient fee-for-service delivery system that still rewards providing more volume, instead of better value, in most health care decisions.

Well said. That’s something to think about.

Advertisements

One thought on “You get what you pay for

  1. It seems that when something is subsidized by a third party, volume is bound to go up and quality is bound to suffer. When the supplier looks to the third party subsidy for payment rather than the demander (sorry if I tend to use econ term), he supplies what the third party is paying for, i.e. volume rather than quality (which is so, so hard to accurately measure and which varies with each individual. The same happens even when the subsidy is given to the demander as the demander faces less consequence if he buys a poor quality item – he can always just buy more (with OPM).

    The ONLY way to fix the problem of prices, volume and quality so that they are what consumers really want, i.e what they value, is to eliminate the government from the equation. It’s as simple (as in uncomplicated) and difficult (as in politically unlikely) as that.

Comments

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s