How do we choose the right answer when there is no right answer?

This article was brought to my attention recently. The relevant part of it basically says “as long as family practitioners are disappearing, we should use nurse practitioners.” This seems to be a popular prescription for reducing health care costs, but it misses a fundamental economic point.

To illustrate, imagine you come home and find a leaky sink. Do you fix it yourself or do you call in a plumber? Maybe you just put a bucket under it and address the problem later (don’t just put a bucket under a health problem though, get on MediBid and get it checked out!). Which is the correct thing to do? It depends. Maybe you’re a surgeon and you also just received a call requiring you to go into the hospital (put a bucket under it). Maybe you’re pretty handy and you can fix it yourself. Maybe you’re running a business and you have more important things to do so you call in a plumber. There’s no correct answer for everyone, everywhere at all times.

In the same way we shouldn’t choose between doctors and nurses once and for all. As a poor college student I’ll see a nurse practitioner, and I’ll fix my own sink. Ten years from now I’ll be doing the reverse. The economic lesson here is that costs are subjective. The cost of seeing a nurse is the combination of explicit costs (a fee for his/her time) and implicit costs (my own time as well as the opportunity to see a doctor instead). While the fee is an objective cost (although if we really trace down the meaning of money in an exchange economy… but I won’t drag you that far afield), the full cost is subjective. Only I can say if seeing a nurse or seeing a doctor is, because only I can know my own situation and my own preferences, however imperfectly.

Of course I also left another economic question on the table. Why don’t we see more family practitioners?

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