Is the Government in American Healthcare a Blessing or a Curse?

Pundits argue over specific policies and legislation, but few ask whether government’s role has been helpful – or whether we should rethink it entirely.

To gain historical perspective, consider the various roles government has played in the past. At the founding of the American republic, the government’s role in healthcare was mostly to protect its citizens from death by foreign invasion or frontier raids. As the country industrialized, government focused on protecting consumers’ safety and the integrity of the healthcare marketplace. Food and drugs were regulated, and newly-arriving immigrants were screened for diseases. Professionals’ training was validated through licensure, and government agencies policed the marketplace to discourage fraudulent dealing between private parties in the buying and selling of healthcare services. About 50 years ago, government expanded to dominate nearly every aspect of the purchase, sale, production and allocation of healthcare goods and services. The result was an unimaginable escalation of healthcare costs and spending that made healthcare unaffordable for millions and depressed economic growth.

Today, the average American family spends $20,000 on health insurance each year, mostly through employer-paid premiums that could otherwise raise their wages. Healthcare consumes one-sixth of the entire US economy and almost half of the federal government’s budget – and is only propped up by massive, unsustainable borrowing. It is estimated that ⅓ of that expenditure is wasted.   

If today’s unaffordable, wasteful healthcare industry is largely a creation of government, is it time to rethink the dominant role government has played the last 50 years?

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