Sunday, May 26, 2013

Two-tiered health system coming?

Forbes columnist John Goodman (the health economist, not the actor) sees a have-and-have-not future for health care.  The wealthy will pay a premium of about $2k/year for concierge medicine, with quick and easy access to one's regular doctor and no surgery delays. 

Most everyone else will be dealing with a rationing-based system, not unlike Canada's.  Goodman sees rationing coming quickly because
  1. Obamacare will create more demand for medical services
  2. But it does nothing to increase the supply of doctors
  3. Many doctors will accelerate their retirement to avoid dealing with heightened regulation
  4. More and more doctors will shift from small practices (where they get paid more if they work more hours) to hospitals where they will pull a fixed salary; as a result, doctors are likely to cut back significantly on their work hours
In other words, supply down, demand up and price not allowed to adjust -- the classic recipe for a shortage. 

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