Health care is a public good, not a marketplace commodity

Most developed countries in the world understand health care to be a public good, provided by government action to ensure all citizens have access to care.

America considers health care to exist in the marketplace, a commodity to be purchased by consumers. The result: Many people cannot access health care as they cannot afford to purchase it.

Our national commitment to free-market capitalism has resulted in a failure to recognize a distinction that can be identified in Scottish economist and philosopher Adam Smith’s “Wealth of Nations,” in which he laid the philosophical foundation for capitalism. A careful reading suggests Smith distinguished between two types of “goods” — public or social goods and consumer or marketplace goods.

Public goods include, among other things: safety and security, education and health. Smith recognized that a marketplace cannot exist absent the protection of police and a military, the education of children in schools and the prevention and controlling of disease.

However, many believe that a commitment to capitalism requires that health care be understood as a marketplace commodity, in which those who can afford it have it; those who cannot, do not.

“Health care is not a commodity,” asserted American medical educator and ethicist Edmund Pellegrino, “and to treat it as such is deleterious to the ethics of patient care. Health is a human good that a good society has an obligation to protect from the market ethos.”

In 1972, Kenneth Arrow won a Nobel Prize in Economics, in part for demonstrating that health care cannot be an efficient component of the marketplace. He argued that among the several health-care characteristics that set it apart from the marketplace is the complex knowledge required to make sound judgments regarding appropriate care; knowledge not readily understood by the lay person.

There is a substantive distinction to be drawn between the transactional relationship of an individual buying a new television from a salesperson, and a person requiring surgical intervention by a physician for treatment of a malignancy.

As a result of the asymmetry of knowledge between the patient and the health-care professional, the patient must trust the health professional in ways not necessary in dealing with a salesperson when purchasing a television. Smith’s laissez-faire marketplace of commodities is competitive, where the seller is attempting to sell a product for the largest profit, and the buyer is attempting to purchase the product for the lowest price in order to conserve personal resources.

In the late Middle Ages, the concept of “learned professions” emerged, in which certain individuals (generally understood as physicians, attorneys and the clergy) were literate and possessed (powerful) knowledge to which the uneducated required access. These individuals “professed,” (avowed/promised) that they would always use their knowledge and skills in the best interest of those seeking their services.

Thus, the quintessential characteristic of learned health-care professionals today, as then, is trust. Health-care professionals are not purveyors of commodities.

Arnold Relman, longtime distinguished editor of the New England Journal of Medicine stated categorically: “Health care is not a business.” Rashi Fein, noted Harvard health economist, protested the commodification of health care: “A new language has infected the culture of health care. It is a language of the marketplace, of the tradesman, and of the cost accountant. It is a language that depersonalizes both patients and health professionals, and treats health care as just another commodity. It is a language that is dangerous.”

Basic health care is a foundational social good, a good that should not be treated as just another commodity. Political leaders must understand this important distinction, and lead the nation in joining the rest of the world’s advanced nations in ensuring the health care is available to all through public funding.

This story was originally published May 11, 2017 at 2:59 PM with the headline "Health care is a public good, not a marketplace commodity."