Private Sector Innovations
- Defined contribution health insurance (the employer contribution is applied).
- Medical homes.
- Re-pricing chronic care.
- Electronic medical records.
- Value-based purchasing (patients pay the marginal cost of more costly choices).
Full piece on Dallas-area innovations (gated).
Innovation is always a good thing.
Value-based purchasing is something that has been done in every other market for millenniums. That is: consumer compared amenities and the marginal cost. Consumers then decided which goods and services held value and paid for their preferences. Yet, only in health care where there is a convoluted system of third-party payment is the idea of paying for value seem novel.
The title of this post should read….Private Sector Innovations the Government is Finding Ways to Corrupt. At least they are already doing their best with EMR and medical homes (possibly the rest).
Wouldn’t the list of government-sponsored inventions be much much much longer?
Ambrose, I assume by government-sponsored, you mean that government is sponsoring something before it has been invented and backing the inventors with the capital they need.
It seems like we have enough private capital in this country that government funding often isn’t needed – that’s my guess why the list would be so short.
@brian and @ambrose both are right and wrong.
@ambrose- there has been lots of government invention, but to get the funding they have forcefully taken the money from people…..and have lots of failures as well.
Unlike private companies that have many, many incentives to keep losses down…..the government often shrugs its shoulders at massive losses of money. Furthermore, it is the scientists that come up with the invention, and there would likely be more funding for research if the money wasn’t taken out of the market in the first place.
Therefore, while there have been many government inventions the would likely have been many more without the government.
@brian- there is a lot of capital, but the government takes a lot to fund its research (see the NIH, DARPA, and NSA budgets). The government produces a lot of research and innovation, but the kicker is that in all likelihood more could be produced by the private sector if they didn’t forcefully take the money in the first place.
Both,
We can debate the role of government research, I am even supportive in some areas, but the fact is that whether innovation comes out of the government or the private sector it is the implementation of that innovation that can save….or lose money. The government has proven that it is excellent at finding ways to make good innovation lose money.
@Ambrose, you are indeed correct.
@Brian, how is that different from a private company inventing something? Who pays the bills is rather irrelevant.
For evidence, check out this recent invention:
http://www.slate.com/blogs/trending/2012/06/26/superfast_wi_fi_that_attaches_information_to_light_beams_created_by_scientists_at_darpa.html
@Charles, many inventions would not have existed were they not funded by our nation’s largest pocketbook. That’s an important distinction between public/private innovation and it means that not ALL things could just as easily be done by private companies.
Were computers not first purchased by the Social Security Administration, most economists think there would not have been economies of scale. Without police and military, private companies wouldn’t be able to invent. Without the interstate system, our development would have been much slower.