Milton Friedman on Healthcare

From a classic 2001 article by Milton Friedman, How to Cure wellness Care: Two simple observations explain both the mettlesome school level of spending on checkup surge and the dissatisfaction with that spending. The graduation is that just about payments to physicians or hospitals or other managegivers for aesculapian checkup checkup care are do non by the patient further by a third social cluban insurance go with or employer or governmental body. The support is that nobody spends soul elses money as wisely or as frugally as he spends his own. No third start upy is involved when we shop at a supermarket. We pay the supermarket work directly: the same for gasoline for our car, wearing apparel for our back, and so on down the line. Why, by contrast, are or so aesculapian payments made by third parties? The answer for the get together States begins with the fact that health check care ingestions are exempt from the income impose if, and only if, medi cal care is provided by the employer. If an employee pays directly for medical care, the expenditure comes stunned of the employees after-tax income. If the employer pays for the employees medical care, the expenditure is treated as a tax-deductible expense for the employer and is non included as part of the employees income subject to income tax.

That strong incentive explains why most consumers frig around their medical care through their employers or their spouses or their parents employer. We have become so accustomed to employer-provided medical care that we regard it as part of the natural order. even so it is well il logical. Why single out medical care? sustenance is more essential to life than medical care. Why not! exempt the cost of food from taxes if provided by the employer? Why not return to the much-reviled company store when workers were in effect salaried in kind rather than in cash? The resurgence of the company store for medicine has less(prenominal) to do with logic than pure chance. It is a wonderful exercising of how one poorly government policy leads to another. During World warfare II, the government...If you want to get a full essay, order it on our website: OrderEssay.net

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