Paul Krugman writes today that moves to introduce more consumer choice in US medical care are useless because patients aren’t really consumers. They do not have the information as Ken Arrow pointed out long ago. Austin Frakt points out that they asymmetry is not just in information but how that translates into power. Of course, the actual power of patients is an empirical issue for which we don’t have much information.
One insight we get from this is a study that Andrew Leigh and I conducted a little while ago (not yet published because apparently the issue of patient power isn’t of importance to health economists!). That study looked at doctor-patient negotiations over birth timing. Here is the paper and here (and here) is a discussion explaining the result. The bottom line is that in Australia, patients have some power (despite the large public health care system) while in the US they have no power (despite the private system).