Economic Forces, Clinical Constraints

Abstract

To understand just what challenges physicians face as a result of the economic overhaul of health care, we need first to note a few fundamental features of the United States’ health care system. In its broadest outline, that system is more or less a free market. Much of its financing is private, and most of its providers are, too. Within certain regulatory parameters, citizens have free opportunity to become providers (‘sellers’), offering a wide diversity of health care services and facilities from major hospitals to sports and wellness clinics. This is unlike those systems in which a government, acting as sole overall provider, determines how many of which facilities and services will be established to serve which citizens. The free market system also features a wide variety of purchasers (‘buyers’), in contrast to those systems in which government is sole purchaser on behalf of all eligible citizens. As reinvigorated by the Reagan and Bush administrations, this free market approach is based on the belief that if individuals are free to buy and sell goods based on their own preferences, it will be possible most efficiently to satisfy citizens’ wants and needs, to improve quality of care with innovative services and products, and to keep prices down through vigorous competition.¹