Monday, August 18, 2008

Random Health Services

Random Health Services

An example of a side effect from government influenced health care.


Some Canadian doctors are using lotteries to cut their waiting lists (National Post, August 6, 2008). The patients who draw the short straw will have to find another family doctor — which one Canadian out of eight lacks. This phenomenon illustrates some interesting aspects of the Canadian health care system.

When market prices don’t ration demand, another mechanism is required. Everybody can’t get everything. At zero official prices, consumers will demand a very large quantity of health care services. Since the taxpayer is not ready to pay for it, supply must be rationed. If groceries were made free by a “Canada Food Act” and provincial “foodcare” monopolies, the same would happen in grocery stores as now happens in hospitals, clinics and doctors’ offices: shortages.