Determining Health Care Rights from Behind a Veil of Ignorance

Abstract

Should our society establish positive rights to health care that each citizen could claim, as many health policy analysts believe? Or should it provide only background rules of contract and property law and leave the provision of health care to the free market, as Professor Richard Epstein advocates in his recent book, Mortal Peril: Our Inalienable Right to Health Care? This article argues that this question should be addressed from the Rawlsian "veil of ignorance" perspective. That is, the question should be answered by asking what kind of society individuals would agree to form if they had no knowledge of their individual skills or endowments; if they did not know whether they were rich or poor, health or sick, weak or strong. The article contends that individuals behind such a veil of ignorance would balance their inherent risk aversion (which favors a safety net of "rights") against the inefficient incentives created by rights regimes that would reduce net social wealth (which favors a free market). Whether they would choose to establish rights to health care or not is ultimately an empirical question that turns on how inefficient any particular right would be. The question thus requires a case by case analysis of proposed rights. The article then considers the policy issues of (1) community rating of private health insurance and (2) the mandated provision of emergency medical care. It concludes that in these cases the inefficient incentives created by establishing rights are probably small and/or controllable enough to lead individuals behind the veil of ignorance to favor a regime of positive rights.

JEL Classification: K32, I18