Keeping fees high

THE EDITOR: Professional licensing, more than keeping the public safe, is about keeping fees high. This has been inadvertently revealed by the resistance of doctors to the Medical Board’s attempts to revamp the specialist designation.

In economics, barriers to entry are one of the key factors that cause economic inefficiency, ie, higher prices and scarce services. Licensing is one device that creates these conditions.

If doctors did not have to be licensed, and if regulations did not prevent certain services from being provided by anyone, then medical costs would drop. Nurses, for example, can provide many of the treatments that doctors do, but are prevented from doing so by law.

The argument for licensing is that it protects the public from fraud and life-threatening treatment. To the extent that this happens, however, it is clear that licensing is a crude instrument. Moreover, in the absence of licensing, people would be more motivated to find competent professionals, either by word of mouth or through non-government quality agencies (which would surely be created without a state-sanctioned medical board or law association). This is what happens when people hire contractors or go to a barber.

For political reasons, licences will always exist. But the push should be towards loosening professional requirements, not tightening them, since this will only lead to even higher fees.

ELTON SINGH

Couva