“When you spend your own money on yourself (box 1), you try to maximize quality while minimizing cost. And that drives the businesses that are competing for your money to constantly seek more efficient ways of producing better products at better prices.”
“This system generates creative destruction, which sometimes can be painful, but the long-term result is that we are vastly richer.”
“Governments, by contrast, don’t worry about efficiency or cost (box 4).”
“For all intents and purposes, instead of buying health care with their own money, they use other people’s money (box 2), a phenomenon known as third-party payer. And because most of their health expenses are financed by either government (thanks to Medicare, Medicaid, Obamacare, etc) or insurance companies (thanks to the tax code’s health care exclusion), consumers focus only on quality and don’t care much about cost.”
Why Single-Payer Health Care Delivers Poor Quality at High Cost | Daniel J. Mitchell
When you spend your own money on yourself, you try to maximize quality while minimizing cost. When you’re spending other people’s money on other people, you aren’t concerned with either quality or cost.