THE UNITED STATES IS A CAPITALIST country, and our system of medical care is, to a significant extent, organized for profit. True, many hospitals are nonprofit, but the same cannot be said of doctors, who, judged as a whole, form an extremely affluent and privileged occupational group.

Sometimes physicians themselves seem a little uncomfortable about the business aspect of their professional lives or worry that outsiders will misinterpret their attention to economic matters. For example, the professional journal Medical Economics, which discusses pocketbook issues such as malpractice insurance, taxes, fees, and money management (“Are You Overpaying Your Staff?” is a typical cover story), works hard at not being available to the general public. When a subscriber left his copy on a commercial airliner, another reader found it and sent the mailing label to the magazine; the magazine’s editor sent a cautionary note to the subscriber. The editor advises readers to “do your part by restricting access to your personal copies of the magazine.

Don’t put them in the waiting room, don’t leave them lying about in the examination rooms, and don’t abandon them in public places.”67 Medical Economics probably suspects that even in our capitalist society many people, including probably most doctors, would not like to think of physicians simply as medical entrepreneurs who are in it for the money. And, indeed, many people here and many more in other countries criticize our medical system for being profit oriented. They think medical care should be based on need and that ability to pay should not affect the quality of medical treatment one receives.

Interestingly, though, some people criticize medical practice in the United States as being insufficiently market oriented;

prominent among them was the late Milton Friedman, a Nobel Prize-winning economist at the University of Chicago.

Friedman was a long-standing critic of occupational licensure in all fields. His reasoning is straightforward:

Licensure—the requirement that one obtain a license from a recognized authority in order to engage in an occupation—

restricts entry into the field. Licensure thus permits the occupational or professional group to enjoy a monopoly in the provision of services. In Friedman’s view, this contravenes the principles of a free market to the disadvantage of us all.

Friedman had no objection to certification—that is, to public or private agencies certifying that an individual has certain skills. But he rejected the policy of preventing people who do not have such a certificate from practicing the occupation of their choice. Such a policy restricts freedom and keeps the price of the services in question artificially high. When one reads the long lists of occupations for which some states require a license—librarians, tree surgeons, pest controllers....

Discussion Questions 1. What explains the fact that licenses are required for so many occupations? What do you see as the pros and cons of occupational licensure in general? Does it have benefits that Friedman overlooked?
2. Do you believe that licensure in medicine or any other field is desirable? If so, in which fields and under what circumstances? What guidelines would you use to determine where licensure is needed?
3. Is occupational licensure consistent with the basic principles and values of capitalism? Is it a violation of the free-market ideal? How would you respond to the argument that licensure illegitimately restricts individual freedom to pursue a career or a trade?
4. Does licensure make the market work more or less effectively? Would you agree that as long as consumers are provided with accurate information, they should be permitted to make their own choices with regard to the services and products they purchase—even when it comes to medical care? Or is licensing necessary to protect them from making incorrect choices?
5. Friedman and others view the AMA as a trade union, and they believe that the high incomes of doctors are due more to artificial restrictions on the free market than to the inherent value of their services.
Is this an accurate or fair picture of the medical profession?
6. Is licensing an all-or-nothing issue? Or is it possible that although only licensed professionals should be permitted to perform certain services, paraprofessionals and laypersons could perform less expensively but equally competently other services now monopolized by licensed professionals?