ABSTRACT
Health care incentives are a mess. Training medical personnel so that the reinforcers that are effective for them are not financial but the health of their patients has been partially solved through a grueling and often criticized training process: internship and residency. Patient care cannot be a truly competitive market. Patients don’t know enough about treatment efficacy and don’t for the most part decide on the basis of price. But costs can be controlled via monopsony. Alas, in drug purchasing, a prime area for price-control negotiation by the government as a major purchaser, negotiation is forbidden. In short, the US health care system is neither fish nor fowl; it is not competitive where competition might work, and it is not controlled where controls might work. It is no wonder the US pays twice as much for health care as other nations and gets, if anything, rather less.
