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Comment by VancouverMan | Hacker News Reader

This is the kind of economic distortion that should be expected when onerous government-imposed regulation of practitioners, medication, and medical devices creates barriers to entry that reduce competition.

While such regulation may have been imposed to try to increase safety, quality, and consistency, for example, it also ends up interfering with the incentives of the participants.

The lack of real competition, combined with the introduction of significant unnecessary costs and other overhead, encourage and enable the participants to act in ways that may not be beneficial to the patients.

The truly unfortunate part is that such regulation often takes options and choices away from the patients, preventing them from accessing alternatives that may help mitigate or avoid the perverse incentives introduced by regulation.

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Alternatively, this is the kind of economic distortion that occurs when excessive de-regulation removes the floor of a market, allows local monopolies to flourish, and allows a system in which the most profitable action is to let people die.

While such deregulation may have been imposed to increase competition, it also interferes with the incentives of the participants.

The lack of real oversight, combined with the introduction of unnecessary profit margins and shareholder returns, encourage and enable the participants to act in ways that are harmful to patients.

The truly unfortunate part is that deregulation often takes options and choices away from patients, as an unregulated market’s tendency toward monopoly prevents them from accessing alternatives that may help mitigate or avoid the perverse incentives introduced by quarterly performance targets.

Strongly disagree with this comment. The most powerful monopoly one can hold is one entrenched by the will of the government. Every time the people have asked the government to step in and regulate healthcare, corporate lobbyists have crafted the laws in such a way to weigh down any potential competitors.

In the US, the more regulated a market is, the more likely people are to demand further regulation, because they incorrectly blame the free market when the market is anything but free.

The unnecessary deaths in US healthcare are largely attributable to waste and incentive mis-alignment; the person paying for healthcare isn't the one receiving it, so it is no wonder patients receive poor care.

> the person paying for healthcare isn't the one receiving it, so it is no wonder patients receive poor care.

This works fine in fields like the restaurant business or the haircutting business, where people can decide for themselves what they want to eat or how they want their hair, and they can decide for themselves whether their food or their haircut is satisfying.

The sector where it is least applicable is healthcare. You don't know what disease you've got, you don't know what can be done, and you don't know what the incentives of the people who do know are. This makes it hard to take advantage of the feedback loop from the other industries mentioned.

I don't completely disagree, but that's the edge cases of mystery diseases or rare cancers that make for good headlines.

The vast majority of healthcare is basic screenings (physicals, x-rays, bloodwork) and chronic disease management (birth control, blood pressure). These services are more or less understood and interchangeable, and absolutely can compete on service, quality, and price.

> The vast majority of healthcare is....

...entirely unnecessary procedures done for profit

Almost have it right.

The problem is regulatory capture. Regulating an industry that can easily kill people is probably smart government. The problem is this creates a system that allows companies like Pfizer and Moderna, or Siemens, or GE or capture many or all of a given market sector.

I would actually argue regulatory capture is a worse outcome than de-regulation in almost any industry. It's a delicate balance. In our industry we can see this with last mile internet. We can see this with taxes in America where regulatory capture has permitted Intuit to have a license to print money. No different than providers, insurance companies, and medical device manufacturers.

Here's one example. If we took some regulation away from health insurance providers, allowing them to make bigger risk pools through cross-state service, the patients would by and large see better and more consistent outcomes. In fact, this is so scary there are untold billions being pumped into congress to stop it. Instead, we got the abortion of a solution known as the ACA. Sometimes properly applied deregulation creates the environment needed to make an industry better by removing regulatory capture. Competition is a good thing at all levels. Any effort to completely stamp out the competitive nature of human beings always results in worse outcomes for everyone. Imagine if doctors had to compete for patients! The life of a doctor right now couldnt be easier. Make friend with insurance and the wallets-with-pulses are sent directly to you!

Patient options and choices such as "go to the doctor" vs "go into crippling debt while trying to navigate a labyrinthine billing nightmare"?

Just as an alternative point of view - you describe these regulations as "government-imposed". Would it not be equally (if not more) likely that these regulations are being created and supported by the industry players themselves?

This lack of real competition that you mention sounds like a dream if you have few scruples and a captive market. And telling someone that they'll die unless they pay for your services seems to be about as captive of a market as you can get.

I think choices was meant to mean things like being able to choose between competing healthcare providers.

Created and supported by big industry players that get them turned into law (and thus "government-imposed" - classic regulatory capture.

On the Mexican side of the border there are clusters of doctors, dentists, etc., offering lower cost treatment. I imagine that a large part of the decreased cost is due to reduced regulations that make it easier for small, independent providers to offer their services, which in turn results in substantial competition between the many providers to offer the lowest cost for the standard of treatment that patients want.

That's describing two different services, preventative care, and reactive care.

Your only choice for reactive care is generally only the closest place, and you may not even get a choice on the provider because you were unconscious when it was chosen.

Once you're there hooked up to a machine, how are you changing provider now that you know their services aren't right for you?

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