This thread is a perfect example of Hayek’s fatal conceit.
Here a pro- central planning pundit points to one preferred version of price setting, declares that it “works,” and then treats every other failure of price setting as somehow unrelated.
Maryland has all payer hospital rate setting and global budgets. You like the outcome, so that counts as smart planning (not to mention Maryland has plenty of flaws).
Medicaid pays pediatricians far below commercial rates, patients struggle to find doctors who participate, and suddenly that is not a problem with rate setting per se. That is just the wrong rate setters, or the wrong politicians, or the wrong program. Or Medicare pays hospitals 5x what a doctors office charges. Just the wrong central planners again.
But the core problem is the same. No commission has access to the dispersed knowledge needed to set the right price at the local level.
It cannot know the capacity of each pediatric office, staff wages, rent, malpractice costs, supplies, local demand, physician burnout, opportunity cost, patient urgency, or how much a parent values being seen today instead of six weeks from now.
Prices are signals that coordinate resource use in the face of scarcity.
When planners suppress or manipulate prices, the cost does not vanish.
That is the unseen harm.
The fatal conceit is believing the problem is never central planning itself. It is always that the right central planners have not been put in charge yet.
If the concern is access, subsidize patients. Give people purchasing power. Do not pretend a commission can calculate the right price for every clinical situation from above.
There’s zero reason that every American can’t have access to pediatrician visits without any more government involvement than a means tested cash equivalent subsidy. There’s no more of a market failure there than with food.
But central planners don’t want that. They just want control.
Overly simplistic argument *designed* to cast ALL rate setting as "socialism."
Price controls don't invalidate rights. They're often used to protect rights when market power prevents genuinely voluntary exchange (ie: HC).
Should humans have different values based on income?