Next year Obamacare will give more than thirty million Americans completely subsidized health care under Medicaid, or mostly subsidized health care under the state exchanges. As the demand for health care will dramatically increase and the supply of medical professionals able to service that demand will remain essentially unchanged, we can expect to experience things like longer wait times for surgery, having to drive further to visit a specialist and even the possibility that no doctor in drivable distance is accepting new patients.
On a free market, increased demand that producers cannot meet would be, at worst, a temporary phenomenon. Greater demand for a service would allow producers to command a higher price, which would incentivize more people to enter the market. In the case of medicine, you’d expect the medical field to become more lucrative, which would incentivize more people to enter the profession and meet the increased demand.
But that’s not what’s going to happen in medicine because medicine in this country does not operate nearly on a free market—it is one of the most controlled industries. The effects of all those controls can be complex to trace, but to start, here are just a few ways by which government holds down the supply of health care professionals:
- After graduating from medical school, doctors must enter residency programs to train under experienced physicians. Residency slots are funded mostly by the government, which has capped the number of slots since 1997. On a free market, individuals would rush to enter a field in which there is great demand—but that’s restricted in today’s market. Read more about this issue here.
- What physicians earn is heavily influenced by government decree. Obamacare forces insurance companies to provide preventative care without charging any co-pays or deductibles. As a result, demand for primary care doctors, in particular, is predictably expected to skyrocket. On a free market, a field in greater demand would command greater pay, incentivizing more individuals to enter it. But in today’s market, pressure-group-warfare, not market forces, determines earnings. Read more about how the government sets physician pay, here.
- The government grants a monopoly to doctors to perform most medical services. Other health care professionals, such as nurse practitioners, are often forbidden from performing services that they have undergone training for, such as drawing blood, prescribing certain medications and performing other routine primary care functions. Fortunately, some states have begun reversing these laws. Read more about this issue here and here.
These are just a few of the distortions on the supply side of the market, and there are countless others on the demand side as well (30 million individuals now entitled to totally subsidized [or mostly subsidized] health care was, after all, not a market phenomenon). Given the distortions, we should not be surprised when finding a doctor willing to see us becomes a harder and harder task. The only solution is to free the market.