third-party payments reduces the role of quality rationing by price, so everyone wants the best.
Americans, many of them, believe that they are entitled to the best health care. But this is impossible; only a few can get the best. Suppose we all agree that the Smith-Jones Clinic is the best. Then ten times as many customers demand access as the clinic can handle. What to do? The clinic could raise its prices sky-high, eliminating most customers. This is rationing by price, which we reject. Or it could pick those it thinks have most to benefit (perhaps excluding anyone over age sixty-five) or pick blindly by lottery. It is still rationing, but not by price. Or it could expand its capacity tenfold. Then its quality would have to fall, it would no longer be considered the best, and other clinics would be faced with the problem of rationing excessive demand. Not everyone can get above-average anything.
Why do beneficaries always want more than any viable system can deliver? First, of course, they are unaware of their costs, or if aware, the cost to them of additional services may approach zero. Second, there are exaggerated expectations of what medical care can deliver, largely induced by the medical care establishment. Third, there is the change in what many people consider acceptable states of health and well-being; ours has become a hypochondriac society, in part because of the enhanced ability to deliver effective services and propaganda to that effect, in part because of rising incomes and an increased ability to pay for health care. Fourth, we have experienced a correlated shift in self-concepts from the Calvinistic, tough image of the past to a self-indulgent, tender image of the present, and a related change from a concept of health and sickness as natural outcomes of personal behavior, mental attitude, and uncontrollable events to one of medical interventionism, victimology, and extroversion of responsibility. Related to this change toward a narcissistic self-image is an increase in risk aversion and a demand for a fail-safe, risk-free life and an extreme reluctance to accept death as inevitable, a pathological fear of death. The demand for fail-safe cures is part of the explanation not only for the large increase in malpractice suits but for the preposterous awards recommended by juries.