The Semantics of Rationing Health Care

There are two dictionary definitions of ration. One is to give people a limited amount of something for free and the other is to prevent people from spending their own money to consume as much as they want of something.  Almost nobody ever objects to the first definition which is getting something for free.  But healthcare is different.  People frequently object to expanding our government rations of free healthcare. 

Econbrowser says that there are three ways to ration health care.

The basic reality is that we have found some ways to prolong life and reduce suffering that are very, very expensive. What we need, in my opinion, is a social and moral framework for deciding which of these are worth doing and which are not.

And there are three ways to determine which medical services don't get provided.

• (a) The government can limit the procedures it will pay for and the people who are eligible to receive them.
• (b) The insurance company or other third party can limit the procedures they will pay for and the people who are eligible to receive them.
• (c) If [the government] and [insurance companies] both say no and you don't have the money yourself to pay for it, then you do not receive the treatment.

Each of those options is morally troubling to many of us. But reality forces us to choose some mix of the three. Pretending that there are no tough choices just digs us deeper into a debt that can't be repaid.

That third option is the normal way the free market always rations goods by people's ability to pay.  But we usually do not call this 'rationing'.  It is just everyday life under capitalism.  If I don't have enough money to pay for massages, then the market will 'ration' them away from me in favor of someone with more money.  Critics who complain about government 'rationing' of health care never mean that the US government proposes to block you from buying health care with your own money.  They are complaining about restrictions on government entitlement spending.  They seem to want to force the government to pay more extensive kinds of health care.  We do not call it 'rationing' when the government funds other projects.  For example, when a government-run school system cuts their music program we do not say that the government is rationing music.  The government just stopped paying for it and so parents will need to buy their own music lessons privately if they can afford it.  It is odd to criticize the idea of expanding health insurance as being a form of rationing, but many critics of universal health care proposals do exactly that:

government can forcibly reduce the expenditures on medical services by only two methods: 1) restricting the use of medical services, and 2) lowering the payment for such services. And regardless of what Congress and the administration may claim, ultimately, these two boil down to one: the "R word"--direct or indirect rationing of medical care.

True, the government often does restrict the medical services that the government will pay for (no medical marijuana, for example), and it does have a lot of bargaining clout to reduce the prices it pays to doctors, but this is not really rationing because it does not prevent anyone from spending their own money for legal medical services at any price.  This is a far cry from real rationing like the US government did during WWII.  The government issued ration tokens that limited how many consumer goods people could buy with their own money. Even the richest man in America was legally required to limit his consumption of gasoline, tires, sugar, meat, cheese, coal, shoes, and many other basics according to his ration allotment. 
Rationing usually means restricting people's consumption despite their ability to pay.
Real rationing is a feature of every medical system.  Rationing medical services is popular in the US if you just stop to think a bit.  For example, triage is the emergency room's protocol for rationing immediate care according to need.  Human organs are rationed according to a similar formula of expected benefit rather than according to ability to pay.  Whenever there is rationing, there is also usually a black market where people with enough money illegally pay extra to get more than they are rationed.  Even human organs for organ transplants are sometimes allocated by bribes to get around the rationing.  Only a small minority of Americans, like the textbook author I use for microeconomics (Froeb), thinks that human organs should be allocated by the free market according to ability to pay rather than rationed by medical protocol. Furthermore, all medicines are rationed by prescriptions from medical doctors whose services are rationed by licensure. 

Rationing other kinds of health care is possible and, for example, is done in Canada, but that is not what US health proposals have been about.