U.S. health care: Free drugs, no waiting

In a checkout line in a big-box grocery store on a trip to Florida last week I saw something that didn’t compute: a flyer for free drugs from the store’s pharmacy. “These meds are free for as long as a doctor prescribes,” the flyer read. And it listed seven common meds, including two for high blood pressure and one for diabetes, as well as four antibiotics.

The big-box chain that was offering the deal is Publix Super Markets, which started in Lakeland, Fla., the spring training home of the Detroit Tigers, and now has more than 1,000 outlets in the southeastern U.S. Its flyer offers another 25 drugs at the rate of $7.50 for a 90-day supply.

That’s $7.50 in U.S. dollars. But still.

We economists try to avoid the word “free.” As Milton Friedman taught us, There’s No Such Thing as a Free Lunch. Or a free anything. Everything has its cost. Everything requires you to give up something.

Sometimes you give up money, sometimes time or other opportunities: Having lunch in one place with one set of people means you can’t have it somewhere else with another set of people. (Not at the same time, at least, although it’s not unheard of for people to have two lunches in one day.)

The drugs that Publix is giving away didn’t materialize out of thin air. Time and money went into producing them. But Publix has decided to offer them at a zero price, which is our economist’s term for “free” (even if “the best things in life are zero price” doesn’t have quite the same ring to it). Publix gets your prescription information, which may have value to it, and maybe it gets your other prescription business, where it can make up its costs on these loss leaders. Or maybe you start buying your groceries there. Or it has other motivations I can’t plumb.

But still. Free drugs.

Another thing you notice in Florida are big billboards advertising this or that hospital’s care by telling you what the current wait time in its emergency department is, using the same bright red or green LED lights you see gas stations post their fuel prices with. The idea that emergency wards would actually compete for consumers by offering rapid service is mind-boggling to Canadians — it always is to me — as is the idea that the usual wait time would be measured in minutes rather than hours, which was the case on every sign I saw on my latest trip.

Another thing about Florida and across much of the U.S. is that when people hear you’re Canadian, often the first thing they want to talk about (maybe after apologizing for Trump) is health care. Some tell horror stories about paying many thousands of dollars for a hospital’s treatment of their straightforward, uncomplicated health emergency but even those Americans who are very satisfied with their own care worry that many of their fellow citizens fall through what can be pretty wide cracks in their system, if you can call it a system.

Our system has cracks, too, although successfully avoiding them has less to do with cash than with class and education and which doctor you went to school with or has kids in your kids’ daycare.

Despite these imperfections, the data suggest we do a better job of getting health care to everybody than the Americans do. I get that.

But still. Free drugs. And emergency rooms competing for patients by providing prompt service.

I’ve never waited 18 hours in a Quebec emergency ward, which appears to be roughly the time required for your case to make it into the papers. But a couple of years ago when I broke my elbow slipping on ice, I waited 25 hours over three days before I got a definitive decision about how to treat it. (The system did provide painkillers while it slowly, slowly digested me.)

The problem with systems where we all get the same treatment is that sometimes the treatment isn’t so good. Budgets and service menus are fixed on a top-down basis, there are no alternative suppliers, and unions and others providers rent-seek, often successfully. With nobody facing the pressure of competition, the only obligation to provide excellent speedy service is moral.

As Adam Smith argued in The Theory of Moral Sentiments, his first masterwork, which preceded The Wealth of Nations by 16 years, people generally do respond to moral incentives. I’m sure he would have applied that to doctors, too.

But in a monopoly system presided over by a single government minister of health, moral incentives are often all you’ve got.

Most of us don’t want the U.S. system holus-bolus. Judging by the polls, most Americans don’t want the U.S. system holus-bolus, either. But fierce competition in both drug pricing and emergency service? That’s a prescription we should be trying to fill.

THE PROBLEM WITH SYSTEMS WHERE WE ALL GET THE SAME TREATMENT IS THAT SOMETIMES THE TREATMENT ISN’T SO GOOD.