> The problem is that without strict regulation any health care market will be flooded instantly with quacks. Yes, many more quacks would advertise services.

> The problem is that without strict regulation any health care market will be flooded instantly with quacks. Yes, many more quacks would advertise services. > Quackery is much easier than actual medicine. Quacks don't have to spend anything on R&D and quack medicines are a lot easier to manufacture (look up the synthesis pathways for popular pharmaceuticals!), so they can spend more on marketing and operate with much higher margins. Good point! > Pretty soon there will be little legitimate medicine left in the market. I'm not so sure. Even the canonical example of this phenomenon, Gresham's Law, requires legal tender laws or some similar mechanism which requires the acceptance of the "bad" money on par with "good" money. It's not clear that a requirement would happen in laissez-faire medicine. > Medicine has a unique and extreme case of the "uninformed consumer problem." In medicine it's incredibly difficult even for professionals to tell whether something actually works, let alone individuals. > > "Do your own research" doesn't work at all in medicine unless you have a billion dollars burning a hole in your pocket and can assemble your own research lab. Excluding emergency medicine and the most instantly and dramatically effective drugs, it's really hard as an individual consumer of health care to tell whether a treatment is working over the short term. Check out gwern.net and how much work he's put into trying to tell if various nootropics work and how much uncertainty remains. Agree. "Do your own research" in medicine doesn't work very well for a host of reasons. Chief among them: physicians don't understand the complexity of the body as a system. Microbiologists don't even understand the complexity of a single cell. We (humans) understand human life in certain aspects, and it's remarkable what competent physicians can do with the knowledge they do have. But if even they have no idea what is going on beyond essentially sophisticated educated guess-and-check, what hope does the layperson have? > The fact that individual discernment is so hard in medicine means defrauding people is incredibly easy. It's a market that is inherently vulnerable to massive fraud, and there is no easy way (that we know of) to fix this. Even with the FDA there is still a tremendous amount of quackery. Without the FDA and strict licensing and supervision there would be only quackery. I'm not sure the FDA is the only way. We could have stronger laws that punish fraud in civil court, or make practitioners liable financially (or in severe cases, criminally) for ineffective or harmful treatments. Things like the Internet make the information problems less daunting than in the bad old days of patent medicine salespeople roaming from town to town (though today we have unregulated MLMs). I also think that the regulation to which I refer is much broader than simply FDA regulation. Billing, electronic records, purchasing, distribution of medical equipment, pharmaceutical distribution, laboratory testing and just about everything else in the US medical system are regulated beyond belief. Many of these regulations were introduced with the goal of "improving efficiency," and have instead resulted in protected, rent-seeking firms with zero gains in efficiency. They've resulted in the death of the private practice, and have siloed practitioners into Kafkaesque organizations, each of which is a single point of failure. I'm skeptical that the FDA should do much beyond determining the safety of treatments, but there is a host of other regulatory nonsense in health care that could be innovated around, including many of the things GP was talking about.