by Dr. Lawrence Wilson

© May 2024, L.D. Wilson Consultants, Inc.

All information in this article is for educational purposes only.  It is not for the diagnosis, treatment, prescription or cure of any disease or health condition.

Health care systems in most developed nations are in financial difficulty.  Health benefits are being cut back due to exploding costs. Degenerative illnesses such as diabetes and cancer are at epidemic levels in spite of new drugs and treatments. While doctors, politicians and insurers blame each other, they rarely mention the real problem.

Skyrocketing costs are due to the structure of health care in all these nations. All are mainly socialized, including America. This means they operate as top-down bureaucracies, out of touch with people’s real needs.


America really has three health care sectors:

The socialized sector comprises about 65-70% and includes Medicare, Medicaid and the Indian Health Service.  It also includes the Veterans Administration, the Public Health Service, programs such as Kidscare and the bulk of medical research. The latter includes the National Institutes of Health, National Cancer Institute, National Heart Institute and about 30 other government institutes. The ‘donors’ for this research have little say over what or how wisely their health research dollars are spent.
            All the above are funded from taxes confiscated from the people at the point of a gun, making them a less-than-compassionate system.  All are insulated from the health care marketplace and thus from rational decision-making.  All are run as huge bureaucracies, with their inherent problems of fraud and high administrative overhead.  Medicare rules alone are 133,000 pages.  This makes the 10,000-page income tax code look like a model of simplicity.

·           The regulated sector, which is called the private sector, comprises most of the rest of the health care system.  It is not a free market or private sector by any means.  The correct word is the over-regulated sector because it is riddled with thousands of cartel-inspired rules and regulations that cripple most of the real competition from alternative method of healing, for example, and from alternative healing devices that must be approved by the FDA, which is thoroughly corrupt and does not allow most of them.

·           The true private sector is very small in health care.  These are mainly unlicensed ‘healers’ who offer a variety of services, almost under the radar of the regulated and socialized sectors of health care.  Yet they care for thousands of people, generally with simple, natural healing methods such as nutrition, herbs, massage, foot reflexology, shamanic methods, bodywork and a few others.


An example of the dismal failure of the socialized sector in America is the ‘war on cancer’, administered by the National Cancer Institute.  It has cost taxpayers some $30 billion over a 35-year period.  After adjusting for a longer life span, between 1950 and 1989, the incidence of cancer  rose by about 44%.  Breast cancer and colon cancer in men have risen about 50%, while some others have risen 100%. (See Epstein, S., Losing the War on Cancer, Int J Health Serv., 1990 (20)1:53-71 and Epstein, S., Evaluation of the national cancer program and proposed reforms, Amer J Indust Med., 1993; 24:109-133).  

A recent article in the Journal of the AMA was entitled "Are Increasing Five-Year Survival Rates Evidence of Success Against Cancer?" The answer was, No. (JAMA, 2000, 284(4) June 14:2975-2978).

The news mostly announces new cures and new drugs, but nothing about the waste of money of federal cancer research.  A recent news broadcast said some cancer had declined “due to lifestyle changes”.  For this we paid $30 billion.  However, this waste is predictable because national research laboratories are not primarily interested in a cancer cure, no matter what they claim. They are interested foremost in keeping their jobs and second in getting more money next year from Congress. This is the nature of all bureaucracies.


The so-called private sector of American health care is better termed the regulated sector. It includes insurance companies, HMOs and licensed physicians. To receive any government reimbursement they must "play by the rules" imposed by the socialized sector. As a result, this sector is mainly an extension of the socialized sector.

            Insurance companies are burdened with over 1000 state and federal mandates regarding what services they must cover. HMOs are also heavily regulated and are in fact creations of the US Congress via the HMO Act of 1973. Without government subsidies and overrides of state laws that forbade physicians from being paid to deny care, they would not exist.

            Medical schools also receive government subsidies and grants. This means what is taught is influenced, if not dictated, by these funding sources.  Physicians are regulated by state licensing boards and, of course, must abide by Medicare and HMO regulations if they choose to work in these settings. To call any of these aspects of the health care system "private" is a joke.


Perhaps two percent of the health care system is private or free market. It is composed of the unregulated, non-mainstream holistic and alternative healing schools and practitioners. People pay cash for their services and products. Practitioners and suppliers must respond to people’s needs to stay in business.

            I have a medical degree but have worked as an unlicensed nutrition consultant (not a dietitian) for 43 years. My attention is focused 100% on what clients need, not on getting grants or subsidies, receiving insurance reimbursement or paying lobbyists to plead my case in Washington.  In the free market sector, costs for vitamins, for example, have decreased.

            Sadly, many alternative practitioners who were shut out of mainstream medicine have lobbied for licenses.  There is no real need, except they can charge more, keep out the competition and hopefully force insurers or the government to reimburse their services.  These include chiropractors, naturopaths, acupuncturists, physical therapists and others.


A cartel occurs when one organization controls the entire production and distribution of a commodity.  It is most important to understand that medicine in America is a cartel.

Through licensing and other laws enacted in the early part of the twentieth century, one group, The American Medical Association, controls how many medical schools exist, how many students enroll, what is taught in the schools, the availability of hospital residencies, and indirectly through licensing laws, who will get jobs in medicine.  No other industry in America is so tightly controlled by one group or union.

            Alternative therapies and practitioners have been ruthlessly suppressed, with their proponents often being run out of the country.  Thousands of Americans flee each year to Mexico and Europe to obtain products and therapies banned in the United States, but in use for up to 50 years elsewhere. 

            The kingpin of the cartel is the restrictive state medical licensing laws, passed in the early part of  the twentieth century.  Previously, there were no licenses and the health care system worked well.  However, the drug doctors were not making  enough money.  The AMA, formed in 1847, was quite candid about their intentions.  They sought vigorously to reduce the supply of doctors by eliminating their competition and controlling the number of medical graduates.  By their efforts, the number of healing schools fell from 140 in 1900 to 77 in 1940.

            The purpose of a cartel is to improve the income of its members.  From this perspective, American health care is a resounding success.  Goodman and Musgrave, in their excellent book, Patient Power, explain that “the AMA endorsed the idea of a medical cartel and made participation in it an ethically mandatory”. (p. 140)   

            In his book, Price discrimination in Medicine, Kessel states “The delegation by the state legislatures to the AMA of the power to regulate the medical industry in the public interest is on a par with giving the American Iron and Steel Institute the power to determine the output of steel” (p. 29.)


The large drug companies and the FDA operate pretty much as a unit.  Anyone who believes the FDA is an impartial or even helpful agency needs to read The History of a Crime;  How Could It Happen by Harvey Wiley, MD, first director of the FDA.  In the book, which was banned for a time in the US, he meticulously details how the FDA became infiltrated by food and drug companies and its mission completely subverted.  The same adulterated foods Dr. Wiley objected to in 1906 – bleached flour and sugared, caffeinated soft drinks – are still approved by the FDA 100 years later.  As a physician, I believe no other single agency has caused more deaths than the FDA. 

            Physicians are the legal drug pushers in our society.  Those that step out of line and prefer to prescribe vitamins, herbs or non-patentable drugs often lose their licenses, though they do no harm.  Only one state, Arizona, has a second medical homeopathic board that allows medical doctors to escape from under the thumb of the state board of medical examiners and practice as they see fit.  In the past two years, a few states enacted laws to protect physicians from losing their licenses just because they use methods unapproved by their medical board.

            Through physician licensing and hundreds of other rules, only those who practice drug medicine hold licenses, work in hospitals and HMOs, and direct government research institutes. This effectively blocks change. Most alternative health practitioners who practice a far less expensive type of healing are shut out of the mainstream.

Special-interest laboratory laws also abound. In America one cannot walk into a laboratory and request a cholesterol test. One must first go to a doctor to obtain ‘permission’. Results may not be sent to the patient, only back to the doctor. This means another doctor visit. Thanks to these rules, a ten-dollar test may cost $100.00 or more. The extra cost discourages people from caring for their health. Instead, they wait until a crisis occurs, which further raises the cost of health care. In Mexico, by contrast, one just walks into a laboratory, orders the test and receives the results.


Whenever an industry becomes mired in special-interest rules, deregulation is the answer. It is a healing process that many industries periodically need. America deregulated trucking, airlines, the phone system and power generation. In every case, dire predictions of chaos did not come true and the public benefitted greatly. Power deregulation has been very successful everywhere except California, where it was not done correctly. This is important, because medical deregulation must be fair and encourage competition in order to benefit the public.

Private regulation of health care is not new.  For her first 120 years, America had a true free market health care system free of government interference.  Herbalists, hydrotherapists, nature cure practitioners, allopaths or drug doctors, homeopaths, osteopaths and others offered services and competed with one another.

There were few licensing laws so no group had a legal advantage. Whoever helped people the most prospered.  Competition between many kinds of practitioners kept prices low, people paid for exactly what they wanted and our health statistics ranked first in the world.  Today America ranks 19-37th in the world in many health care areas.


The biggest problem with the drug medicine cartel  is that drugs and surgery do not prevent disease, do not address deep causes of disease and do not make people healthy. They mainly suppress symptoms. According to the American Public Health Association, 48% of the determinants of disease are now due to "behavioral lifestyle", 25% are due to genetic constitution, 16% to the environment and only 11% are due to lack of access to medical care. Often drugs make people sicker, which only adds to the cost. Malpractice lawsuits due to harm from the system add even more cost.

According to a recent article in the Journal of the AMA (JAMA 2000 July 26;284(4):483-5), modern medicine is the fourth leading cause of death in America, just behind cancer, heart disease and strokes.  This only includes deaths that occurred in hospitals.  The Nutrition Institute of America completed a broad survey of the side effects of drug medicine.  They found that adverse drug effects and medical errors account for some 669,000 deaths, making it the leading cause of death in America.  A 2009 report by Gary Null, PhD, entitled Death By Medicine also found that modern medicine is the leading cause of death in America. 


An entirely different model of health care is possible. Instead of focusing on diagnosis and treatment of disease entities, it focuses on supplying missing factors of health. The new model is a true science of preventive medicine. There is no reason to wait to supply the factors of health. Prevention is hundreds of times less expensive than treating a condition when it has fully developed.

            The new model uses more sensitive assessment methods that detect imbalances long before a disease occurs. Whether by checking one's spine, hair tissue mineral analysis or acupuncture pulses, small problems can be detected and corrected before they become serious ones. It is the only way to control health care costs and really improve people’s health.

            The new model stresses participation and presumes the patient is responsible for his health. Changes in diet and lifestyle can only be recommended. Self-discipline and desire to be well are required. An adult-adult or client-consultant relationship with the doctor replaces the current parent-child relationship. Patients need to ask a lot of questions. Taking responsibility is healing in itself. It is empowering, replacing the futile and energy-wasting attitudes of fear, denial and self-pity.

            The new model redefines health. It is not just an absence of cancer or heart disease. It is the act of relating harmoniously with one’s physical, emotional, intellectual and social environment. Health is never a commodity that can be bought and sold, doled out to the poor or guaranteed by a government agency. All such thinking is incorrect. Health is an outcome of understanding oneself and perfecting one’s relationship with one’s surroundings.


The health care cost crisis offers an opportunity to view health care like any other industry. There is no market failure. How can there be market failure when there is almost no health care market, in the sense of free agents who willingly buy and sell based on free access to information?

Deregulating health care would have to be part of dismantling the welfare state, as the two are closely related.  Medical licenses are not only the basis for the cartel’s control.  They are meal tickets for any doctor who wants to participate in the welfare state.  No one mentions how unfair this is.  All Americans pay for the welfare system, but only licensed practitioners receive benefit in the form of reimbursement for their services.

            Replacing licensing with private certification would break the power of the cartel and help restore a free market.  No physician would be prosecuted and jailed for doing his best.  Many people, brainwashed by 100 years of life under the cartel, would object, as they have objected to all the other deregulation efforts.  I believe, however, the American people would be much better off.

            Instead of the FDA, several competing consumer rating groups would do far more to protect the American people than the current system. Lest this seem impossible, it was the system used successfully in America for over 120 years. Several organizations tested new medicines and medical devices and decided which merited their seal of approval.

            Though we may not wish to admit it, American health care is only slightly less socialized than the single payer systems of Europe and Canada. No wonder costs are out of control. Deregulating health care would benefit all Americans and restore a crippled system to sanity.  Health care does not have to be costly or dangerous.


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