I've been thinking more about the health care/insurance article I linked to yesterday and I want to add one qualification to my general agreement with the authors. They write in their conclusion:
Finally, we must repeal HIPAA and all other government regulations involving health insurance or medical care. It is immoral for doctors to be subject to criminal penalties for documentation errors that violate no rights and have nothing to do with the quality of patient care. ...
As I considered the article, the phrase I bolded above stood out to me. I won't defend HIPAA, but I don't agree that "all other government regulations involving health insurance or medical care" should be eliminated. In particular, I think a very important role of government is to mandate transparency from experts in the commercial sector. There's no way that I as a health care consumer can ever know as much as the doctors who treat me, but the final decision for any treatment I undergo still lies with me and not with them. To that end, the government should require the disclosure of treatment information from medical professionals.
I'm thinking of a medical equivalent of the nutrition information that's mandated on food packaging. I don't want the government to tell me how many Fritos I can eat, but if it weren't for government-enforced transparency I wouldn't know what goes into Fritos and I wouldn't be able to make an informed decision about how many to eat. The government already requires drug manufacturers to disclose the potential side-effects of their products (do we need them in every commercial though?) and I think there should be similar transparency in other medical arenas.
It is a legitimate role for government to prevent experts from harming or defrauding consumers with their information advantage.
Thanks for linking to my article, Mike -- I'm glad you enjoyed it.
You raise an interesting and important question with respect to the issue of mandatory transparency. Here's my take on this issue, as applied in general to consumer goods (not just medical goods and services):
In a free market, the government definitely has a role in protecting against fraud and misrepresentation by the part of producers of goods and services. So if a yogurt manufacturer labels his products as "low fat", whereas they really have the normal amount of fat, then that should be illegal and the company should be punished appropriately.
Similarly, deceptive contracts and advertisements should also be outlawed, when crucial information and terms are hidden in the "fine print" (or the equivalent) in a fashion that cannot reasonably be expected to be visible to a normal, educated consumer. That's just part of standard contract law. When one party signs an agreement without a genuine "meeting of the minds", then the contract should not be regarded as valid.
However, I don't think it's the proper role of the government to mandate companies to include specific items of information in their labels. That can and should be left to the marketplace. So if there is a growing consumer demand for potato chips that have a, say, low magnesium content (I'm just picking an arbitrary chemical element here), then manufacturers will find it in their interest to advertise that fact. And neutral 3rd-party testing agencies would undoubtedly arise to verify such manufacturer claims, and to do their own measurements of the magnesium content of various potato chip brands even when potato chip manufacturers don't specify the magnesium content one way or another.
We already see such taking place amongst health-conscious consumers who want to specifically purchase products that are grown with certain farming techniques or which do/do not contain certain types of additives, etc. A genuinely free market will respond much better to the desires of consumers for this sort of information than a government bureaucrat in Washington DC.
Given the importance of factual information about drug effects and side effects to doctors and patients alike, I believe this sort of information would be very quickly forthcoming in a free market, because it would be in the interests of reputable drug companies, testing agencies, and doctors to have the truth out there. For instance, a drug company might voluntarily agree to routine audits of their lab notebooks by neutral third parties, and agree to swear under oath that they have disclosed all knowledge of adverse drug side effects to certain private "watchdog" consumer groups. Less scrupulous drug companies that don't agree to such voluntary transparency measures would find that good doctors and testing agencies will be skeptical of their claims about their products, and this would be heavily detrimental to their reputations and their bottom line.
(It might also require some nontrivial reforms in the legal system, such that honest companies can't be easily sued as "deep pockets" for problems that aren't there fault, but they are quickly held accountable for problems that truly *are* their fault.)
In summary, the government should not mandate which specific information should or should not be disclosed; that should be left to the free market. But when manufacturers make claims about their product, they should be held fully accountable by the government for the truthfulness of those claims - that is a part of fraud prevention and a legitimate function of government.
I hope this helps clarify my position.
hsiehp: Your approach would work in an ideal world with lots of competition, but unfortunately we don't live in such a place. For example, it's probably good that we allow drug companies to patent their products for a while to recoup development costs, but those patents also (obviously) prevent competition from other drug companies who might want to sell the same drug but give their customers more transparency.
I think the "nontrivial" legal reforms you mention would be very important, but I also don't see them forthcoming.
In all, government mandated transparency isn't ideal, but it seems like a suitably limited exercise of public power that creates a lot of good for little cost. I like the idea of private testing companies putting their own seals on products, but I'm not aware of any such system being widely used. (Not sure that "kosher" markings by Jewish organizations are of large enough scale.)
Anyway, there's certainly a lot of room for improvement!