What Adam Smith said about the butcher, the brewer and the baker is equally true in health care. You cant be successful in the medical marketplace unless you are meeting other peoples needs. The more needs you meet, the more successful you will be. Profit is one measure of how much good you are doing.
A profitable medical enterprise is one that takes resources that have a value elsewhere in the economy (as measured by the cost) and creates even greater value for consumers/patients (as measured by the revenue). By contrast, a loss implies that resources are being used in a way that is less valuable than their use in producing something else.
[There is such a thing as charity care. But in this day and age, most hospitals have found a way to make a profit by being charitable! Thats a subject Ill reserve for another day.]
|John C. Goodman is a Senior Fellow at the Independent Institute, President of the Goodman Institute for Public Policy Research, and author of the widely acclaimed Independent books, A Better Choice: Healthcare Solutions for America, and the award-winning, Priceless: Curing the Healthcare Crisis. The Wall Street Journal and the National Journal, among other media, have called him the Father of Health Savings Accounts.|
Obamacare remains highly controversial and faces ongoing legal and political challenges. Polls show that by a large margin Americans remain opposed to the healthcare law and seek to repeal and replace it. However, the question is: Replace it with what?