Free market capitalism, not government control, makes healthcare more affordable, researchers discover

Saturday, February 13, 2016 by: L.J. Devon, Staff Writer
Tags: healthcare, free market capitalism, government control

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(NaturalNews) Researchers from the Stanford University School of Medicine and the National Bureau of Economic Research have uncovered the path toward more affordable healthcare. The path doesn't consist of new government mandates, taxes and consolidated government insurance plans. The path toward healthcare prosperity is less systematic, less consolidated, less controlling and less fear-based. It's a more open system, with more options that put the patient back in control.

"The research comes out of trying to understand some dramatic changes that have occurred in the health-care system over a couple of decades," said lead author Laurence Baker, PhD, who is a professor of health research and policy at Stanford.

Government intervention and fear-based care has created consolidated systems that confuse patients and drive up costs

The researchers found out that the answer for more affordable healthcare is simple: Get rid of the government controls and consolidation of physician services and instead create more competition in the marketplace. This doesn't mean create more specialists, more testing procedures and more diagnoses. This excess has occurred because of the loss of competition between individual physicians. This excess is a result of a healthcare system that has become more controlling and fear-based, creating more centralized systems that run patients from one specialist to the next in confusion.

What used to be several private practices, consisting of one or two independent physicians, has evolved into more complex organizations with many specialized doctors and systems. The competition that used to exist between individual physician practices has dwindled and diminished, consolidating care into larger organizations of healthcare providers who can raise the cost because there's no one in the area to compete with the price. They continue to raise the prices through the years because they know that patients have fewer options and will eventually be herded through their doors anyway.

As co-author Kate Bundorf, PhD, put it, "This has always been an important issue, and now it's even more important as policy moves us more and more toward larger practices."

Rammed through complex "efficient" healthcare systems

The larger practices allow doctors to work in groups and exchange information about a patient's medical history more readily. A bigger staff operating as one can take on a larger volume of patients, but this way begins to treat patients as units on a conveyor belt, as the time per patient dwindles to maximize efficiency within the larger healthcare organization model.

Also, with these consolidated healthcare systems in place, patients are trapped into having less choice as they succumb to the higher prices. The care is cheapened, as patients are rammed through the large gamut of specialized services.

Lead author Laurence Baker said, "It's an important question for the U.S. health-care system right now. If we move toward larger practices, how can we get the benefits but avoid the challenges higher prices would create?"

Researchers find that honest competition lowers the price of healthcare

In the study, the most prominent physician specialties were studied, by price. The study investigated the role of competition in determining the price of healthcare among medical providers and prices paid by the most common type of health insurance plan held by privately insured people -- preferred provider organizations (PPOs).

The researchers determined the average price paid for each healthcare service in 1,058 counties across all 50 states using the Analytics MarketScan Commercial Claims and Encounters database, which includes the prices paid to physicians for the more than 49 million privately insured people in the US.

The researchers used the Hirschman-Herfindahl Index (HHI) to determine the relative size of doctor practices to measure market concentration. A lower HHI represents higher competition, while a high HHI shows that the area is dominated by one large practice.

When they looked at the results, one thing was clear. The greater the competition in any given area, the more affordable the healthcare was. The top 10 percent of the markets with the least healthcare competition had the most costly "intermediate" doctor visits. These visits were $5.85 to $11.67 higher than the areas with the highest levels of competition.

When the costs of all the types of doctor visits were averaged, the least competitive markets were found to be the most expensive, averaging 3.5 to 5.4 percent higher in cost. With privately insured individuals spending nearly $250 billion on physician services yearly in the US, this small percentage multiplies into tens of billions of dollars.

Co-author Bundorf was surprised by how powerful competition is in healthcare policy, saying, "These larger organizations might have better processes in place to optimize care. But our research also points out, well, wait a minute: We also have to think about the effect on prices and try to balance those two things when we think about how to form policy about these organizations."

Less government control opens up new healthcare opportunities

Without government controls, the human race, especially in the healthcare industry, can become more compassionate and intelligent. With more options, the costs can be lowered in key areas, especially for the more unnecessary "healthcare" diagnostic protocols.

For one, imagine if government was out of the way: Then, healing plants could be made more available as medicine. Imagine a free healthcare marketplace where doctors prescribe very affordable options that actually work to heal- - like revealing dietary measures to cure diabetes, heart disease and more. Imagine all the high-end tests that would become unnecessary, like colonoscopies and mammograms, if doctors could prescribe to their patients the foods that prevent problems in the colon and breast tissue. Imagine cannabis oil curing seizures, curcumin and dandelion root cleansing livers -- all for a fraction of the cost of modern day "healthcare" protocols.

Sources for this article include:

http://www.sciencedaily.com

http://jama.jamanetwork.com