I hate waiting for doctors. You've got an appointment at 4pm, you arrive a few minutes early, and you're kept waiting for an hour and a half. That's what happened to me recently when I had to see an orthopaedic surgeon, and he became literally enraged when I expressed my irritation at waiting. How dare I criticize his performance of a service I'm paying for? I made a single, not particularly aggressive comment, and he ended up throwing me out of his office. What gives? Well, it's not that hard to explain from an economic standpoint.

Unlike many other more customer friendly businesses, a doctor's income is limited by the number of patients he can see. A widget-maker or a widget-seller can always sell 10% more widgets, so he has to keep his customers happy. His income depends on how many widgets he can sell, and he has an unlimited supply of them. Each disgruntled customer is money out of his pocket, so he wants to keep them all happy.

Doctors, however, seem to have an easy time filling their appointment book; there's a limited amount of time in the day, and as long as it's filled doctors have no incentive to keep their customers happy. (Plus, many doctors are extremely arrogant.) Any patient who resents the poor customer service and leaves can be replaced with another, and as long as the doctor's time is maxed-out it doesn't matter how angry people get.

Taking a more macro view, much of the problem can be laid at the feet of government regulation. The situation I just described persists because the government regulates the medical industry and makes it extremely hard for people to practice medicine. Think about it: does it really take a doctor to diagnose an ear infection or to set a broken bone? No! A nurse or an EMT could do the same job far more cheaply and with far less training. Doctors can treat their customers poorly because they have a government-enforced monopoly on their profession, and the medical schools, the American Medical Association, and the various state and federal governments all collude to continually raise barriers to entry.

What's more, this government-medical collusion increases prices for everyone. A wealthy person who can afford to pay the fees may very well prefer to see an MD for an ear infection -- and he'll probably get superior care -- but why should a poor person be forced by the government to engage such an expensive professional simply to get a prescription for amoxicillin? Yes, sometimes the ear infection will be something more serious that only a MD could diagnose, but most of the time it won't be and the money used to pay the MD will be wasted. Shouldn't the customer get to make that decision, instead of the government?

So if you want to improve service and reduce costs in the medical industry the solution is simple: reduce government regulation and let the free market sort things out.

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