chapter  11
Competition and Health Reform
WithEli Ginzberg
Pages 6

Most Americans look to the market and competition to keep their economy functioning effectively. Small wonder, therefore, that in the late 1960s and early 1970s many academicians, as well as Wall Street operators, saw the rise of for-profit hospital chains as the harbinger of a more efficient and effective health care system. Competition has also been keen among the pharmaceutical and medical supply companies in developing and marketing their new products. The limitations of competition in guiding the development of the health care system can be further illuminated by a brief consideration of some related factors. Competition, in the sense used by economists, has never been the dominant strategy shaping the US health care system. Philanthropy and government have played important roles, abetted by private health insurance. Competition, in the sense used by economists, has never been the dominant strategy shaping the US health care system.