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The Gawande Fallacy



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Ron Bailey writes:

President Barack Obama famously read the surgeon Atul Gawande’s June 2009 New Yorker article “The Cost Conundrum,” which argues that medical costs are high because incentives are skewed toward providing ever more treatment so physicians can earn more money. Gawande analogizes health care to building a house without a general contractor. Without someone keeping an eye on what’s really necessary or desirable, home buyers might well pay an electrician for every outlet he recommends, a plumber for every faucet, and so forth. Doctors get paid for each procedure they recommend. Curing patients becomes an incidental side effect of their treatments. Gawande gets the diagnosis right, but he botches his prescription, calling for the government to impose such a general-contractor model. But cost-conscious contractors exist in the housing market because of consumer demand, not government mandate.



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