Question to ponder.

[nolawitch58]

Within a Capitalistic society, are there any endeavors that you think should be not for profit or is profit the only driving force that matters?

It seems to me that profit at any cost is a moral hazard in some instances. All but the most callous of laissez faire capitalist recognizes that price gouging, the onerous increase in price for a commodity during an emergency, is repugnant. Nobody should have to pay ten dollars for a one dollar bottle of water in an earthquake or hurricane ravaged area.

There are some natural limits to profit making. If the fickle fashion market decides that the mauve so pervasively popular last season is no longer in, all mauve clothes will no longer command high prices. If supply oversaturates a market, demand cannot keep up and prices go down. Otherwise, profit for goods can be reduced to simple formulae summing costs of raw materials, labor, overhead and shipping plus a margin of what the market will bear.

I think that some endeavors should not be for profit because of the high risk of moral hazard contained within each. Look at the current uproar about health care. The medical-industrial complex has become a tangled web of greed and avarice. Any industry that can spend a million dollars a day fighting efforts to reform it qualifies as having already achieved a moral hazard in my opinion. Exacerbating the many ills within the medical-industrial complex is a two-fold problem: if a person has health insurance, the list of doctors on the plan are limited making it difficult to shop around, and the medical facilities don't list their prices or even discuss them comfortably with patients if asked. In emergencies, the priority is survival and not finding a cheaper hospital to have a wound repaired.

How then would we guarantee that quality medical facilities would even be available if they can't make a profit? Oddly enough, those business models exist in hundreds of thousands of communities already. They're hospitals, teaching hospitals associated with medical schools and clinics in low-income neighborhoods. All Catholic hospitals are non-profit. Here in New Orleans, we have Ochsner Hospital, which is non-profit. Teaching hospitals are non-profit.

Where then are the profits being made in the current system? The middle men. Insurance companies add layers of cost, but not layers of value, on to what your health care dollar buys. Not only do they take your premiums and make you pay co-pays that increase every year, but they also deny claims to keep the money for themselves. Medical personnel have to hire a layer of clerical help to handle the non-standardized claim forms that vary between each insurance company. They have to fight to be paid; they have to fight for treatment insurance companies deem unnecessary or experimental; they have to keep up with the capricious changes in pharmaceutical formularies, which are the lists of drugs that an insurance company agrees to pay for.

All the while, insurance companies answer to naught but their stockholders. If they make a profit, the stockholders are happy. If the profits increase, no matter how many patients were denied treatment or suffered unnecessarily, the stockholders are happy. Is this how you personally want your health care determined? By whatever makes stockholders a lot of money and provides outlandish salaries to corporate executives? Isn't it time we thought of what's best for society and not just the bottom line?

Comments

[blackbyrd2.livejournal.com]

Don't forget about unnecessary treatments. They form a large slice of the health care cost pie, and do little to help, and in some cases actually cause more harm.

Having insurance also adds a layer of unaccountability for costs. If the patient pays the same regardless of what the treatment costs, there is room for increased profit taking with no active market pressure to reduce costs. Where is the motivation for the patient to comparison shop?
The people charging for such treatments are also free to make decisions without regard to market pressure.
If you want to see first hand how much this adds to our costs, try a year or two of uninsured healthcare. If your doctor has any ethics at all, you'll find he actively assists in cutting your costs; something which never happens with insured healthcare. (Or perhaps this has nothing to do with ethics, and everything to do with profit. Uninsured patients are the most likely to be the uncollectable debt.)

I agree that some treatments and equipment would never be developed, much less be used, if it weren't for the massive profits realized. Imagine the development of the MRI without a billion-dollar R & D budget. But I also agree that the healthcare industry needs fixing.

[krikkert.livejournal.com]

Adam Smith himself lined up a whole slew of things that the Government should handle, because there shouldn't (or couldn't) be a profit-oriented motive involved. Schools, infrastructure, and health care are examples of things that fully or partially should not have a profit motivation.

[voxwoman.livejournal.com]

Infrastructure, like, say, the communications network? (do I *need* a sarcasm tag here?)

[krikkert.livejournal.com]

Building it, sure. Running it, no (other than ensuring that companies play fair).

[saminz.livejournal.com]

Define "should" :-).

In a perfect world, if anything "should" be a main driving force, it would probably have to be sustainability...

There is truth in the "homo oeconomicus" theory, though. Who would take it upon hirself to devote a decade of their lives to getting a specialized medical degree if it wouldn't (also) mean they will be able to live in comfort ever after? Only some few saints, I'm afraid.

My personal opinion is that profit as such is quite okay. When I manufacture a beautiful chair out of wood, I certainly want to get more money out of it than the other guy who just pours plastic into a mold.
Only in our societies, the differences have grown out of every proportion.
I do think that the work of a surgeon is worth more than that of a street sweeper. But not 30'000 times as much, really.

And my understanding stops completely at the point where the well earning surgeon feels more worthy the more the street sweeper suffers. This is where we stand, at the moment, I'm afraid.

For a pragmatic start, transparency about cost of things would help.
A strong state sector will always be a step in that direction, of course. (So will strong, free media.)

Health care is a good example.
If I pay for a mandatory health insurance, I will want to know why my bills increase year after year. I will want to hear about success statistics for "fashionable" treatments, for example. Or will be interested about pharmaceutical patent deals. And when I'm fortunate enough to live in a democratic country, I will try to elect people into health departments that are not on the payroll of Novartis, of course :-p.

In our capitalist societies, profit indeed is the most common "motivator". But not the only one.
Or not many people would compete for political careers. The power to be a mover and shaker seems to be almost more attractive to some. Or even to "make a difference", in science, politics and what have you.

Ethics are still around somewhere, as well. I'm pretty sure that in most of us, the thought of selling water or oxygen to the highest bidder only somehow causes at least a diffuse uneasiness.
Not sure if this will stay so for much longer, though.

[voxwoman.livejournal.com]

I think that the "mandatory" insurances (i.e. health, auto) should be non-profit endeavors. Remember, however, that "non-profit" does not necessarily mean "government run". I would even go so far as to say that all insurance be non-profit, but the insurers are supposedly taking some sort of risk with their money and if there is no incentive, then there is no reason to put money up in the first place (I'm thinking of the insurance for shipping and suchlike from hundreds of years ago when all these schemes were invented).

If one is required by law to hold insurance (like auto insurance), so that there is a large pool of citizens contributing to it (and the payout money comes from the pool of citizens rather than the pockets of some fat cat somewhere), then the insurance endeavor should be non-profit, and the salaries of the top administrators should be "reasonable".

[pecosdave.livejournal.com]

I've given lots of thought to it, and I agree in spirit that health care should be free, or at least affordable to the individual, but from the logistical/practical side I just don't see it. We're well past the days of being dumped on the local religious cast for care taking, of course the care is much better most of the time now.

That's health care, I throw land onto that list as well. I don't like the concept of land ownership. I like the idea of throwing down a dwelling some reasonable distance from the home of another, this distance varies by terrain and setting, and calling it home. All open range, with the exception of a fenced yard and some provisions for farming. If you decide to up and move, your home is available to the next person who wonders by and wants it, etc... We have much to large of a population for that to work of course. This would rock for beach houses, but I could see that getting really nasty....

I agree the medical industry is fueled by greed and avarice, and on the whole, it isn't the doctors fault. The drug companies are responsible for a lot of it, to much lobby power and to much of a strong arm position and interest on perpetually medicating a condition instead of fixing one. The insurance companies are crooks and victims at the same time, and the populace as a whole is to sue happy and to likely to defraud.

Corruption runs through at every level. I ran into it a few weeks back. When I got my wisdom teeth yanked the very first form on the clipboard was a credit application. I caught onto what it was immediately, I'm not sure everyone would have bothered to read what it was. I could very easily have filled out this credit application and turned it in first thing, where I would now be paying outrageous interest rates on my dental work. Since that wasn't an individual dentist office, but more of a joint corporate run dental clinic, I place the blame on the company, not the individual doctor, but to me that was very dishonest, and takes advantage of the poor and uneducated.

There's another problem with both the subjects I covered. WAY to many people. I have no problem with "helping my own". These are people I know personally, or someone I have some other attachment to through social groups etc... I'll help them find a job, make it over a rough spot, and yes, even care for them if they need it when they're sick. The problem is, this doesn't work in healthcare.

The problem with it working for health care is it's specialized. Only a small portion of the population can do any part of it, and those who can do one part can't necessarily do another part. I don't want my dentist giving me an artificial heart valve for instance. With specialization comes demand, with demand comes price. I'm sure these people would gladly work for free for 20-30 hours a week if all of their needs were taken care of. Instead they make a fortune working 60+ hours a week and take care of their own needs, exceedingly well.

For how conservative I am, I really do long for a "tribal communism" - barter and trade system. It's a much friendlier world that way. To me the Smurf Village is the ultimate example of a positive money-less system where everyone's needs are cared for. Farmer farms for everyone, Greedy cooks for everyone, Papa Smurf is the doctor and the leader, Handy fixes things and Smurfette is the village, uhmm, female. We would need to work on that last one a bit. Unlike the Soviet version there's no one poking everyone else with a stick, it just works that way, a need arises, and someone who appears to have those skills tackles the job. I'm sure I would fill the role Handy does.

We're just in so deep no matter what way you look at it I don't see a universally good fix.

[saminz.livejournal.com]

Bloody hell.

Your story there with the credit form? I didn't think much of the US "medical system" could shock me any more, but...

This is indeed bad. Evil, even. Sorry to hear.