GOVERNMENT IS THE PROBLEM

Politicians used to run for office promising to fix the health-care crisis, but lately they've given up pretending they have any answers. Since 2000, medical costs have soared, and the number of people without medical insurance has grown. Yet the issue has been almost invisible in this presidential campaign. We know more about the candidates' hobbies than we do about their health-care plans.

As it happens, President Bush and Sen. John Kerry have some proposals, which consist mainly of measures to increase the number of Americans with medical coverage. Bush wants to rely on tax credits, while Kerry hopes to reduce insurance premiums by making the government pick up some of the costs of catastrophic illness.

Unfortunately, neither addresses the maddening dilemma we face. Anything you do to expand access to health care, like making insurance more available, increases the demand for health care and, in turn, drives up the price of health care. But if you try to control the cost of health care, you make it less accessible by discouraging hospitals and doctors from providing it. Politicians can't figure out a way to ameliorate both problems at once, so they end up doing little or nothing, or else they take steps that are likely to make things worse.

But there is a way to advance both worthy goals simultaneously--one that has been almost completely overlooked. Instead of focusing on demand, we could take steps to expand supply and promote competition. Like a glut in the gasoline market, that would allow people to consume more without all of us spending more.

Medicine is one of the most tightly regulated sectors in the entire economy, and many of the regulations limit supply. We require doctors to spend at least seven years in training after college, which deters many people from going into medicine. We impose licensing requirements that prevent some trained people from offering care. At the same time, we limit the types of treatment that other medical professionals, like physician assistants and nurses, may provide.

These policies are supposed to ensure quality, but they also deprive patients of options they might happily choose. Licensing of physicians arose in the 19th Century mainly as a way of limiting the supply of doctors and thus shielding the profession from competition.

Even now, California State University economist Shirley Svorny notes, "Many economists view licensing as a significant barrier to effective, cost-efficient health care." You might think tight regulation is needed to protect patients from quacks. But Svorny notes that while this type of regulation certainly raises costs, studies indicate that "the effect of licensure on consumption quality is ambiguous."

There is plenty of evidence that government policies reduce the availability of medical care. Though chiropractic is now widely used, the medical profession waged a long battle to prevent it from gaining acceptance. Today, the value of spinal manipulation for treating lower back pain, said a 1998 article in the New England Journal of Medicine, is "no longer in dispute." Medicare, however, still declines to cover some services that chiropractors are licensed to provide.

That experience should be a lesson about the value of expanding patient options, an approach that could lower costs while increasing satisfaction. It's not the only such lesson. Twenty years ago, midwifery was treated with scorn by medical experts. But a growing body of academic reports indicates that for normal pregnancies, deliveries can be handled as safely by nurse-midwives and lay midwives as by obstetricians.

One reason many people find health care inaccessible or too expensive is that we insist on providing so much of it through highly trained physicians. The idea of finding ways to reduce the years of training doesn't seem to have occurred to anyone. Apart from that, nurse practitioners, nurses and physician assistants could do a lot of what we now rely on doctors to do--and they could do it at a lower cost. They could also expand access to medical care in poor and rural areas that physicians shun.

It's easy to say everyone should get care from doctors. But that's like saying everyone should drive a Volvo. If we limited consumer choices to one ultrasafe nameplate, many people would not be able to afford a car at all. We let individuals make most of their own choices about safety and cost when it comes to their wheels. Why not with medical care?

For the last 40 years, every solution to our health-care problems has been a variation on the same theme: more government. Maybe the real answer is more freedom.

From the Chicago Trib.

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For greatest efficiency, lowest cost and maximum choice, ALL hospitals and health insurance schemes should be privately owned and run -- with government-paid vouchers for the very poor and minimal regulation.

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