Miami’s Health Care Costs: What Happened to Supply and Demand?

Medicine’s costs confound economists. Classical economic theory (I’m not an economist, correct me if I’m misinterpreting) would have you believe that as supply increases demand is met and prices stabilize. In health care as supply increases, demand increases and prices increase. Health care is simply not a reasoned rational system.

Consider Miami: (Time, May 20,2009)

“the 2008 average private-provider costs for a Miami family of four – $20,282 – as the highest among the 14 major U.S. cities it studied, adding that more than 40% of that amount came out of Miamians’ own pockets.”

“Miami’s inordinate health-care outlay – 20% more than the national average – “is not a pretty picture,””

“That’s especially true since Miami-Dade County also has one of the country’s lowest median incomes ($43,495).”

“”South Florida has an “excess capacity of health-care providers and institutions,” Quick notes. And to make sure they all get a piece of the action, they’ve created a wasteful and ill-coordinated system of health-care redundancies, from unnecessary MRIs to inpatient treatment that too often could have been cheaper outpatient treatment. Miami-Dade, for example, has one of the nation’s highest hospital readmission rates – and more MRI machines than Canada.” (Medicynical emphasis)

Medicynical Note: For-profit medicine is simply for profit. In Miami, efficiency and even the patient’s welfare comes second. Can we learn from Miami?

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