Why market competition has not brought down health care costs
Oh look, another attempt to argue that market forces somehow don&#x27;t apply to medical care.<p>In this one, the author makes the argument that &quot;competition&quot; leads to a proliferation of firms, a proliferation of firms leads to administrative complexity, and administrative complexity leads to additional cost. Supposedly, removing this cost would save us enough money &quot;to provide health care to all Americans.&quot;<p>It is easy to attempt to verify this claim by looking at actual data.<p>OECD: &quot;Administration of the US health system alone accounts for about 7% share of total spending. This is on a par with other systems such as France and Germany which also have multipayer systems (even if in some of them there is no or little competition across payers). In comparison, Canada and Japan devote around 4% of health spending on administration.&quot;<p><a href="https:&#x2F;&#x2F;www.oecd.org&#x2F;unitedstates&#x2F;49084355.pdf" rel="nofollow">https:&#x2F;&#x2F;www.oecd.org&#x2F;unitedstates&#x2F;49084355.pdf</a><p>So, if we adopted a true single payer system, by this math, the total spend in the US healthcare system would drop by 3%. US healthcare costs have recently been growing by 6% per year, so this would bring our costs all the way down to where they were on election day, 2016.<p>Next.