Private Health care can arouse strong emotions. In the US, private health care is often criticised for being bloated, inefficient and inequitable; - designed primarily for the benefit of private health insurance companies.
I actually included US health care in a post - 3 of the Worst economic policies of all time
Nevertheless, we need to be aware of the economic arguments in favour of private health care. This enables us to make a more rounded judgement about the best approach for health care provision in the UK and US. Tomorrow I will look at disadvantages of private health care and consider the best way forward for the UK and US.
Advantages of Private Health Care
1. Greater Efficiency and Quality of Service.
Private firms have a profit incentive to cut costs and maintain a good service, which is essential to attracting customers.
Private firms also face competition which is another incentive for better quality services. These factors are absent in government public services.
However, It can be argued health care is not like a private business. E.g. Doctors and nurses don't need a profit incentive to do a good job.
2. Provides greater choice for consumers.
We can choose most goods, why not choose health care?
3. Reduce burden on Government Spending.
If more people go private, less will use the NHS, therefore, the government can spend less
4. Reduce Waiting Lists.
If people go private it will reduce waiting lists.
5. Government Services can become very bureaucratic and experience diseconomies of scale. Arguably the NHS is overstaffed with too many administrators. Private health care can avoid these tendencies to bureaucratic inefficiency.