THE BLOG
06/16/2010 02:19 pm ET | Updated May 25, 2011

Capitalist Free Markets Can Successfully Provide Healthcare - If the Playing Field is Leveled

When I caught up with Phil a few days later I abruptly greeted him saying, "Let's chat about situations where health care services can be optimized by the free market."

Phil was shocked. Our last discussion on healthcare had focused on how the free market fails to provide cost-efficient basic care to many Americans.

Seeing that he had no reply, I continued, "A free market system for healthcare works if the patient can make an informed choice between desirable options so they can shop around for health services. Think about it, when do cost differences make it worthwhile to shop for health services?"

"Medical tourism"

"Great example! Medical tourism will probably continue to grow in the future. Patients considering expensive surgical procedures can research accredited hospitals abroad to find which ones provide quality services at cost-efficient prices. More Americans are likely to go abroad for some services as medical costs in the US continue growing at double digit rates."

Phil shook his head. "I understand your argument but who's really going to trust a hospital in Thailand to do their heart transplant? Most Americans won't gamble with their lives."

"They already are gambling, but that's for another discussion. It's true that many Americans won't consider using medical tourism either because they don't trust hospitals in other countries, don't want or can't to travel abroad, don't have the luxury of time to select a foreign hospital or because it doesn't make financial sense. Accreditation as well as collaborations between US hospitals and foreign hospitals will help address quality concerns. Elective surgeries like knee replacements and many plastic surgeries are expensive enough for the patient to consider medical tourism where the travel costs can be offset by savings in the medical procedures."

"The large percent of patients that either can't or won't travel abroad for surgery will ensure that some of these services will always be provided domestically. What about basic healthcare and preventative medicine. Can the free market succeed there?"

"In The World is Flat, Thomas Friedman emphasized that we live in a global marketplace so the United States can't be complacent. Imagine having virtual medical examinations where doctors in India, Thailand, Nigeria or other countries provide basic healthcare services to American patients here in America at a fraction of the current costs. These patients would go to a US office where a technician, not a doctor, would examine the patient and run all the basic health tests while simultaneously being supervised by an MD abroad via a high speed internet connection. Telemedicine already exists in some places and can ramp up if we see changes in regulations, technology and our comfort with remote medicine. "

"I see how virtual basic healthcare would save money but I suspect that the AMA and other American medical interests would block that from happening."

I signed, knowing he was right. "America picks and chooses when it wants free market capitalism and when it wants domestic protectionism. Right now the domestic free market is failing to provide affordable basic healthcare in the US. If the international community is allowed to compete in a reasonable level playing field, then basic healthcare in the United States would probably become more cost effective."

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