Everyone who is sick should get the cure.
September 28th, 2009 | Published in Economics idea | 2 Comments
This is a follow-up on yesterday’s post about a hypothetical miracle cure for cancer.
If the hypothesized cure is practically free to produce, denying sick people the cure doesn’t benefit anyone. The sick person dies. The inventor doesn’t avoid any effort. The world would be unambiguously a better place if the sick person were given the cure.
The question of how many cancer patients should be cured is trivial. They should all be cured.
The real question is how to divide up the benefit of the cure between those who are cured and the inventor.
Any fixed price is a problem because there will always be some people who need the cure but can’t afford the fixed price. The best solution would be to have a price that varies depending on people’s ability to pay. While a system like this would be difficult or impossible to administer, it is theoretically interesting.
What if cancer patients were expected to pay a fixed fraction of their future income as payment for the cure? If this was still too onerous on the poor, the fraction could increase as total income increases. This system would ensure that the cure is affordable for everyone.
If the inventor is greedy, he could still earn billions of dollars by setting a high fraction for middle and high income patients.
A fraction of income system like this makes more sense to me than a fixed price. There is, though, still the problem of how high to set the fraction.
September 28th, 2009 at 8:57 pm (#)
With all the furor over universal health care regulation we’re having in the US, the plight of Canadian citizens having to wait for appointments with physicians, surgeons and for surgery keeps cropping up as more and more stories of people crossing the border to buy care on the open market here. Just today, there was a TV piece about a doctor who has established a practice as a broker or middleman helping arrange surgical treatment for Canadian citizens in the US. It appears the price is not the problem, availability is.
September 29th, 2009 at 6:38 pm (#)
ClydeB
I was talking about a hypothetical situation where treatment was very cheap.
The problem in most cases is that the process of delivering medical services is very expensive. It seems to be unavoidably labor intensive. Highly trained specialists are needed to treat each patient.
The problem with health care is that everyone wants the latest and greatest treatment no matter how much it costs. This disregard for cost is what is causing the problem.