America's Inherent Healthcare Problem

As we have seen in class and all over the news, the largest and most prominent topic for the debate on private vs. public industries is undoubtedly the healthcare system in our country and the reforms that are being mulled over by our government. The essential question being asked is whether the healthcare industry should be managed by the private sector or by the government. Now, I think we all know what Friedman would have to say about this. He would undoubtedly say that, since healthcare can be divided by proportional representation, it should be controlled by the private sector. However, it is fairly clear that our healthcare system, if it hasn’t failed outright, is deeply troubled. The question we have to ask is why this has happened. Why have cost risen at almost absurd levels over the past 20 years? Why are the vast majority of Americans under-insured? Why has the Market Economy, which has been so incredibly efficient in other areas, failed here? An opinion piece written by Steven Burd, the CEO of Safeway Inc., and published in the Wall Street Journal gives an interesting take on this. Safeway, which manages its own health insurance plans, has managed to keep healthcare costs flat while national costs have risen 38% by focusing on the root cause of our healthcare problem. This issue is not that the healthcare system is broken, it is that Americans are prone to behaviors that inherently increase the amount of healthcare that they “need.” A staggering amount of the healthcare costs in our country are the direct result of our country being composed of generally unhealthy people who eat too much fast food and don’t exercise enough. Safeway has promoted health and fitness amongst its employees to reduce the overall cost of healthcare. More broadly, they have introduced the concept of personal responsibility to the healthcare, which i feel Friedman would greatly approve of.

http://online.wsj.com/article/SB124476804026308603.html