State should stop intervening in healthcare market

Government believes that it should intervene in the provision of healthcare as an essential and often lifesaving service. But food is even more essential than healthcare. Yet, government displays no driving urge to take over and control every aspect of this life-or-death requirement of the people.

Every single one of us needs food to survive. For food we are heavily dependent on farmers - dairy farmers, cattle and sheep farmers, wheat or maize farmers, citrus farmers, market gardeners - whatever foodstuff is demanded, farmers are growing it. We do our grocery shopping at huge hypermarkets or tiny neighbourhood spaza shops or convenience stores. We buy from butcheries, greengrocers and discount wholesalers, or, if we have a taste for more expensive imports, we buy from upmarket delicatessens. 


If a shop offers consistently good value for money, we may travel halfway across town to take advantage of it. Whatever food it is, it is produced, processed, packaged, transported, warehoused, distributed and sold by private individuals and enterprises. Now, what if government’s concern for the people, especially children, who are not getting enough to eat, suddenly escalated to the same degree that it ‘cares’ about our health? In the belief that everyone should be assured of adequate food, government decrees that all families should receive free tax-payer-provided groceries. It takes over all the means of production, supply and delivery itself.


In place of efficient, capable, private business, we have government turning former hypermarkets, supermarkets and other food stores into government depots from which all people, rich or poor, collect their rations on appointed days. Officials do not cater for individual tastes and needs, rather a committee of officials is tasked with deciding which foodstuffs are adequate for a balanced diet for each age group and everyone in each group receives identical grocery packs. Of course, this excludes privileged politicians and officials, who, as occurred in the Soviet Union, receive vouchers to buy from special stores that stock a wide variety of the best available food and drink. 


Our new government-cared-for population has no say in what is provided. To meet the needs of the majority, the diet is bland and appeals to very few. The people working at the food depots are not beholden to the ‘food dependents’ so are inclined to treat them rather badly. Most people would agree that this scenario would be a disaster and most unpleasant. But this is what government is intent on doing to healthcare. The product might be different, but the means are the same, and therefore the results will be as inefficient and ineffective.


The simplest and most effective way to ensure that no one goes hungry is to leave the food market alone and to supplement the income of the poor so that they can buy the food they need. And this, today, in this country, is in fact what happens. Officials can recognise that an efficient food delivery process happens without government getting involved in farming, market gardening or delivery outlets. The pursuit of profits guided by prices that occurs in a free and competitive environment allows food supplies to flow when they are needed to where they are needed. Why, then, should healthcare be treated so differently? The notion that profit should have no place in the production and delivery of essential lifesaving healthcare goods and services is false.


The more vital the product or service, the more crucial it is to have fierce competition in its production and delivery. Profit is the only true motivator of such competition to drive quality up and prices down. Prices for private hospital care are, in fact, lower than the total real cost to government of providing similar services. The Department of Health should not assume that SA’s people will stay poor forever. The nation is in transition from poor to wealthy - given optimum economic policies, our people will soon rise out of poverty. 


Based on that paradigm, the government’s policies and structures should be easily adaptable to positive transition. Firstly, it should concentrate its own limited resources and the energies of its officials on providing quality healthcare to the poor. Secondly, it must allow the private health sector the freedom to grow and create the healthcare environment able to supply the services required by such an increasingly wealthy society. 


South Africans will then have a totally private, high quality, and fiercely competitive private sector to depend on for their healthcare. Even the poorest of the poor, of whom there will be a steadily declining number, will receive the same high quality care purchased by government on their behalf from private sector providers. Food, which is more vital to life than healthcare, is privately produced and supplied. There is no reason why healthcare should not be as equally efficiently, competitively and privately provided. Government should stop intervening in the process.


This article was first published in the August 2012 edition of Medical Chronicle 


HPU Feature article / 13 September 2012

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