On October 25, 2009, this Blog was moved to:  
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Free-Market Medical Care in China and America 

In 141 B.C.E., a new Han emperor sat on the Dragon Throne. His name was Wudi. He ruled for fifty-four years. Wudi believed that all people should have the right to buy certain commodities. He implemented government monopolies in certain critical areas like salt, alcohol and iron. Prices were controlled so everyone paid the same low price. Emperor Wudi believed that commodities essential to survival should not be included in the free-market system. 

After his death, a national debate known as the “Debate on Salt and Iron” took place. The government monopolies were abolished. The poor could no longer afford many essential commodities. The rich grew wealthier. Afterward, the Han Dynasty entered a period of stagnation sort of like what is taking place in America today. The Han Dynasty eventually collapsed.

 After the Communists won China in 1949, health care greatly improved. Prior to that, life expectancy for the Chinese people was thirty-five years. By 2001, it was approaching seventy-two years. The focus in China is on prevention meaning to plan your lifestyle around healthy habits. That’s why early in the morning you may find many older Chinese outside exercising using the graceful, poetic movements of Tai Chi to insure health and longevity.  

Meanwhile, more than three hundred million Chinese smoke American cigarettes and obesity is a growing epidemic in China like it is in the United States. How could obesity not be a problem since the Chinese are having a love affair with American fast food? China loves most things American. McDonalds and Domino’s Pizza are considered gourmet restaurants and can easily be found in China's cities.

 Prior to the reintroduction of a free-market economy in China, there were three basic areas of medical care during Mao’s time. Free substandard medical care was provided to the proletarian working class, meaning workers and peasants. Mao started a program called ‘bare-foot doctors’. This program was the backbone of rural health care in China. This meant anyone could become a doctor. Mao told the people that if you wanted to be a doctor, you didn’t need to go to medical school. All you had to do was have the motivation to provide medical care to needy people and the government would support you and provide limited training.  The second class of medical care went to people like teachers, clerks and secretaries, ‘friends’ of the working class, the proletariat. The only difference was that these ‘friends’ had to pay to get medical treatment. It was possible to face financial ruin from one hospital stay. The third class were termed enemies of the proletariat like former shop-owners, landlords and denounced intellectuals like liberal arts professors. These people were denied treatment altogether. 

Today, that medical system no longer exists. Doctors and nurses are trained the same as in the Untied States. Since Mao’s death, in one of the greatest policy reversals of modern times, China dissolved free medical care in its rural communities, privatized vast areas of the economy and shifted public-health resources toward the cities.

 President Ronald Reagan's administration seems to have been the role model for these changes. During Reagan’s years, the U.S. saw a steep rise in the for-profit sector in medicine, in particular the for-profit hospital chains. Other Republican presidents like the first George Bush continued this rush toward a for-profit, free market approach to health care. The result like what is happening in China today, means there is no room for the poor and uninsured and uninsurable beyond what is considered basic services like blood pressure tests and taking your temperature along with a bit of advice.  

Although China’s government has promised that by 2010, basic medical and health care will cover all rural residents, if someone becomes seriously ill and can’t afford medical care, he is out of luck. Under this proposed basic medical system, subscribers are funded at a level of fifty yuan per person (twenty yuan from the central government, twenty from the local government and ten from the individual). For many peasants in rural areas this could mean as much as ten percent or more of their annual income would have go toward basic health care insurance. The rural people do not have a choice. The government forces everyone to pay his share. 

Basic care also does not include a stay in a hospital. A stay in a hospital in China would cost about $100 a night compared to a thousand or more in America. Since the best doctors live in the major cities, the best equipped hospitals are there too. If a peasant living in the countryside becomes seriously ill, he may have to travel a long distance to get proper medical care. That is, if he has the money. Medical care in China is all about money just like in the United States. Money opens hospital doors and pays the rent for the surgeon’s scalpel.  

However, when it comes to drugs, the Chinese government has factories in every province that manufactures drugs at a low cost. This is one commodity where the prices are controlled. For example, a bottle of antibiotics in the U.S. that costs $80 would cost $14 in China. That cost is still out of reach for many rural peasants living off only a hundred or more dollars a year (six or seven hundred yuan). 

Maybe Emperor Wudi of the Han Dynasty had the right idea when he decided that certain necessary commodities and services should not be part of the private sector.

The piece was originally published at " Speak Without Interruption" on March 25, 2009. This version has been edited.