[QUOTE=EarnedStripes44;695838]So in otherwords, healthcare providers should seek to obtain the highest possible price for product. Seems like the perfect rationalization for price gouging. Snake oil salesmen need apply. [ENDQUOTE]
Health care providers should seek the highest competitively profitable price for their product. If they charge more than the consumer can pay, their business will dwindle and perish. If they charge low enough so the consumer can pay but still above a margin below which they could still profit, then competitors will charge the lower profitable rate and the high end provider will, again, dwindle or adjust down or perish. As I pointed out earlier in this thread, when the vast majority of consumers are private individuals paying out of pocket, the competitively profitable rate must be what they can pay. When a wealthier mass consumer such as an insurance co. or government pays for the majority of clients, the prices rise to higher competitively profitable margins.
[QUOTE=earned stripes]I always thought of healthcare - with all its implied demand inelasticity - as fitting squarely in the public domain [ENDQUOTE]
The Rand Health Insurance Experiment, the most important heath insurance study ever conducted, showed that demand is, actually, elastic. When patients share the costs with insurance, their demand goes down. Totally free health care leads to greater demand and demands for unecessary, or more costly than necessary, care. What also may become more elastic with greater coverage and benefits is the behaviour of the client in ways that raises costs for insurance. This is referred to in the industry as Moral Hazard.
[QUOTE=earned stripes] given whats at stake, i.e. human life. [ENDQUOTE]
What is at stake is not some general concept of human life, but, specifically, YOUR LIFE. Surely, you are FAR more interested in your life than any bureaucracy. If you are so trusting to turn over total control of your health and life to a government bureaucracy to choose what care you need and when you can get it as opposed to consulting physicians of your choice and determining what's best for you, fine. But let the rest of us who prefer to be totally involved in our own well being continue to be able to do so.
[QUOTE=earned stripes] But by your LOGIC, lets just let the free market purist doctrine of perfect discrimination roll all over that. ENDQUOTE]
I have to admit, I am not familiar with this doctrine. Please expound.
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Originally Posted by earned stripes
So when gas prices are up again, I expect to see the same roll out of free market theory  in defense of $5/gallon premium. |
Will Bush be responsible for the coming $5/gallon price? How many Senate hearings on gas prices have we had over the last two decades? How often were they preceded by blustering threats to get at the bottom of the gouging and to expose the evil doers and bring them to justice? What was ever found? What was ever done? The senators knew beforehand that market forces drove the prices, not gouging. Occasionally A gas station! was found to be charging well above others. The only real action ever taken was price controls by Nixon, and that resulted in long lines and gas shortages, so was quickly dropped. Congress also knows it makes more profit off a gallon of gas in taxes than big oil. And when the price goes up to your projected $5--then the government will really be gouging us. By the way, didn't Al gore (forget if it was while he was veep or running for Pres.) say, at that time, that gas prices were too low in the U.S. That, for environmental reasons, we should be paying European prices, which, at that time were over $4/gallon? But when they got that high under Bush, why then, it was gouging. And what about drilling for our own oil. Is the free market responsible for forbidding that?