One of the most popular narratives in American public discourse, especially as it pertains to health care, is that government is bad, and the free market, meaning private industry, is good. And the natural extension of this line of reasoning is that the government cannot, and therefore should not be part of any health care reform solution. Further, only the free market is capable of fixing things, and it was just unfettered from excessive regulation, it would do just that. Although the initial premise, that government is bad, is in many ways true, the rest of the argument just doesn’t follow, and it represents a distorted and inaccurate view of the world.

First off, let’s deal with the government side of the equation. The reality is that our government is corrupt, inefficient, and incompetent. But it’s also important to understand the details, especially if we hope to make things better.

Let’s begin with our elected officials. While corruption has always played a role in government, the current generation of American politicians has taken it to a new level. With the modern campaign finance system, where private industry lobbyists, representatives of the insurance and pharmaceutical industries, line the campaign coffers of both parties and elected officials on almost every level, American politicians have essentially thrown out every known concept of conflict of interest and plain decency. It is little more than legalized bribery. And it shows. Our health care system is organized around, and works best for, the insurance and pharmaceutical industries. For the people who depend on it, on the other hand, it is often just plain terrible. It is a very troubling situation, both in the fact that politicians accept and go along with it, and that it so disrupts any connection between citizens and their so-called leaders.

And then there is the bureaucracy, the non-elected nuts and bolts that carry out the day-to-day workings of government. It is largely bad as well. Its creations include a medical billing and payment system so complicated that it takes high-level college degrees to understand it, and an entire industry to administer it; privacy and security rules so voluminous and confusing that they impede, rather than encourage the flow of medical information; Meaningful Use, the government program designed to encourage computerization of the medical system, so bad that it will likely take the next ten to twenty years to recover from its effects; and now MACRA, the new government “value-based payment” system that will use excessive and likely inaccurate data to destroy anything left of our already-hobbled health care system. It is not a pretty picture. Just about anyone who deals with the health care bureaucracy, in other words, doctors and nurses, is left utterly demoralized and distracted.

And so, if it is true that government is the problem when it comes to health care, does it follow that the free market is the answer? The answer is clearly no. The reality is that the private health care industry may be just as bad.

The best analysis I have read is the eye-opening book, An American Sickness, written by Elisabeth Rosenthal, an MD and journalist. Dr. Rosenthal details how every industry involved in the American health care “market” has gone on a wild ride of profiteering, jacking up prices, taking advantage of, or just outright bilking the system for monetary gain at the expense of everything else.

Almost all of us have had to deal with the effects of annual double-digit increases in health insurance premiums and rising deductibles and co-pays, and the obvious and sickening price-gouging of the American pharmaceutical industry. These are the industries that are going to fix health care?

A much more accurate view of American health care is that both government and private industry are to blame for its demise. And neither government nor private industry, in their present form, is capable of, or even interested in, fixing things.

What we clearly need is better government. We need money out of politics, and likely some form of term limits, to re-establish the bond between elected officials and the citizens they are supposed to represent. And we need a wholesale re-shaping of the bureaucracy and the methods that it employs, and to wipe the slate clean of the excessive and unnecessary rules and regulations that plague health care today.

But at the same time, we need a profound re-do of corporate governance. The sole focus of a corporation should not be shareholder and CEO profits. Corporations, in addition to generating profits, must also take care of their employees and communities, as well. Corporations without consciences are just as harmful, if not more, than corrupt and ineffective government.
And size matters. Too many companies have grown far too large, removing any semblance of competition from health care “markets.”

But I doubt any of this will come about through corporate self-regulation. That is the role of government, good government, to help guide industry and protect against abuses.

So, health care in the U.S. will not be fixed by merely shrinking government or removing government from the equation. We most assuredly need government, but better government, working alongside private industry, conscientious and better-regulated (not over-regulated) private industry, to fix American health care, and to restore the balance that fosters a more healthy American society.

Matthew Hahn is a family physician who blogs at his self-titled site, Matthew Hahn, MD.  He is the author of Distracted: How Regulations Are Destroying the Practice of Medicine and Preventing True Health-Care Reform.

Image credit: Shutterstock.com