Why is it that Washington is spending so many hours over so many months — on top of two decades of prior conversation, analysis and debate — and is still failing to come up with a reasonable way to reform the health care system? Today I will slice through the Gordian Knot and give you a simple way to keep score.
There are four basic questions to be asked of any health care system. If you answer these questions the right way, the path to reform is rather easy and straightforward. But if you answer even one question the wrong way, you will get caught up in a cycle of complexity — with fix upon fix, each trying to patch up the problems created by the previous fix.
Hint: Right answers are the ones that give people socially good incentives. Those are incentives to meet your own needs without imposing external costs on others. Wrong answers are the ones that give people socially bad incentives. These are perverse incentives to impose external costs on others in the process of pursuing your own interests.
httpv://www.youtube.com/watch?v=An1-ntyBcz8
“1-2-3…that’s how elementary it’s going to be”