Comment Re: Romneycare origins (Score 1) 240
The free market is a poor system for setting the price and supply logistics for things with inelastic demand. Health care is the big example, but basic foodstuffs, shelter, water, power, and the like all tend to have problems when they're left to the free market. On the flipside, the free market is *very* good at settling prices for elastic goods, and for driving innovation and luxury.
The free market is an excellent system when you're dealing with elastic demand, there is no collusion between any of the parties, and all the parties involved are fully informed. When you start taking away those critical elements, it very quickly breaks down, and can end up offering far worse outcomes than other systems of resource allocation.
Excellent post! A couple of examples for some very odd and potentially ruinous experiences which I believe are fairly common.
- An insured person who is admitted to a hospital that is in-network may be treated by a doctor who is out-of-network and then faces enormous bills. Such a person thinks that he or she has insurance and is in an in-network hospital.
- A person with traveling insurance is faced with a huge bill from the hospital and when the hospital was told that the insurance is from a different country and the bill is very high to pay out of pocket, the hospital offers a 75% "discount". So the initial bill was hugely inflated.