Finding a Free-Market Fix for American Health Care

The author of the opinion-page column "Single-Payer System Guarantees Health Care for Less," Sept. 11, joins those calling for Canadian-style national health insurance. He asserts that such a reform "would save the US $67 billion in administrative costs alone." But I believe he is barking up a very wrong tree.The notion of megabuck administrative cost "savings" associated with nationalizing health insurance reflects a fundamental misconception. Think of analogous "savings" achieved by nationalizing, say, air travel and eliminating the "waste" of multi-airline competition. Picture a monopoly airline managed by federal employees - no costly advertising, no travel agent commissions, and low-tech, low-maintenance airliners. Efficiency would be further pursued by cutting flight frequency to assure full flights, an d eliminating out-of-the-way stops. Similarly, the billions in "savings" we are supposed to get with Canadian-style reform represent the sacrifice of essential features that make an industry efficient and dynamically responsive to consumer wants. The US system does very definitely require fixing. But, considering how socialist economies are crashing elsewhere around the globe these days, it seems strange that some Americans are keen to emulate Canada's free-care, tax-supported, government-controlled - in a word, socialist - system. Americans will have to be convinced that competition, manifestly successful and effective in other industries, can guide sellers to produce both efficient and high-quality medical care. Stuart G. Schmid, McLean, Va.

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