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Expanded Medicaid in Oregon Brought More, Not Fewer, ER Visits for Nonemergencies


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Image Courtesy of Taber Andrew Bain/Flickr

More bad news for Obamacare and its proponents. A new study from Oregon shows that better access to health care increased—rather than decreased—both the number of folks crowding emergency rooms and the subset of those who sought care for conditions that clearly were not emergencies. Many health experts who supported the Affordable Care Act had predicted the opposite outcome.

After all, when Massachusetts—under then-Governor Mitt Romney—first introduced what you might call Romneycare, data showed that the number of emergency room visits either remained the same or declined. Emergency rooms are just about the most expensive place in the world to get treated for anything, which is why anyone who cares about burgeoning health care costs tries to reserve their use to true emergencies.

The Oregon study, which was published online January 2 by Science, is particularly compelling because it took advantage of a natural experiment that happened in 2008 when the state started expanding medical coverage to working poor households through the use of a lottery system. The random selection of participants allowed investigators to conduct a more scientifically rigorous study than would otherwise normally be possible.

When the investigators compared households that were newly eligible for Medicaid insurance coverage with their counterparts who “lost out” on the lottery, they found that the number of emergency room visits increased by an average of 40 percent. Indeed, nearly every category of emergency room visit saw an increase—from visits during normal daytime hours during the week to visits for things that could just as easily been taken care of in a doctor’s office. The one category that did not increase was visits to the emergency room for true emergencies.

Presumably, the lower cost of emergency room visits for the newly insured made it easier for them to choose the service. Still unknown is whether this was a temporary effect that will even out over time.

While no doubt confounding to some health care experts, the study shows how important it is to check assumptions about what people will do against data about what they actually do.

Another takeaway: there are no magic bullets in health care. If you want to reduce the use of emergency room visits for non-emergencies, you have to do more than just give more people health insurance. For example, if a parent is worried about having to take a day off from work to see the doctor about a child’s sore throat, an emergency room visit in the early evening might seem like just the ticket to solve the problem.

A few pilot programs around the U.S. are taking a more active approach to decreasing emergency room visits for conditions that could be handled outside the emergency room. One of them, called the Voices of Detroit Initiative, has found that reducing emergency room visits requires expanding the hours and locations of primary care clinics as well as coordinating and following up with individuals who would otherwise wind up being regular customers in the E.R.

 

 

About the Author: Christine Gorman is the editor in charge of health and medicine features for SCIENTIFIC AMERICAN. Follow on Twitter @cgorman.

The views expressed are those of the author and are not necessarily those of Scientific American.





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  1. 1. Uncle.Al 3:24 pm 01/2/2014

    The plural of “anecdote” is not “data,” and data are not information. If Obamacare as such and Obamunism as a whole sum to impoverishing, crushing, catastrophic disasters, then critics are disqualified from commenting by their social activism-unacceptable conclusions.

    Personal accomplishment steals from the deserving. Knowledge and understanding mock diversity. Reality is a peer vote. Fanfare not even the common man but LGBT, LGBTI, LGBTQQ, MSGI, GSD, SGL, GLBTA, GSM, MSM, FABGLITTER, LGBTQ+, and especially unknown acronyms.
    By Law.

    Link to this
  2. 2. rdholland 4:04 pm 01/2/2014

    So “free” equates to it will cost us more. Who could have known.

    Seriously, isn’t one of the main issues with health care costs due to the fact that the “single payer” isn’t the person receiving the care? Even low out-of-pocket costs is an effective cost control system and we are moving away from that with nothing in its place. So of course total cost will increase.

    Haven’t the Obamacare supporters ever heard “If you think its expensive now, wait until its free.”

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  3. 3. PTripp 4:10 pm 01/2/2014

    Yet another example of the flawed thinking behind Obamacare.

    It’s past time for politicians to stop thinking of themselves as experts in fields they have no real experience in. Instead of looking at facts, asking real experts, or having real discussions where opposing opinions are at least listened to they tend to come up with ‘talking points’ that they’d use in a debate and with the backing of their party/lobbyists/media they deem them to be ‘consensus opinion’, ‘established facts’, and ‘common sense’ when they may not be at all in reality.

    Notice I only said politicians. I meant people who by profession are politicians. In that realm they are the experts. In other fields they rarely are.

    I’m not singling out any particular party. In my opinion, the larger the party the more likely to abuse their power like this.

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  4. 4. kalimi 5:13 pm 01/2/2014

    i was actually part of that study in the didn’t receive medicaid group. what wasn’t mentioned in the article is how difficult it is to get a primary care doctor to accept a new patient on medicaid. i now have medicare and even on that i had to call around until i found someone much further from my house than i thought i would have to. i believe that human beings always tend to choose the path with the least resistance. i.e. the er.

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  5. 5. Soccerdad 5:29 pm 01/2/2014

    Economics 101. If you decrease the cost of something the demand will expand. In this case it’s the cost to the user – not the cost to the actual payer – that is being reduced.

    Most of the ACA architects are economically illiterate so there will be more unintended consequences than intended ones with this law.

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  6. 6. syzygy 6:07 pm 01/2/2014

    Check assumptions indeed!

    The abject incompetence of those writing and implementing the ACA has only just begun to be revealed.

    Link to this
  7. 7. Robin250 8:46 pm 01/2/2014

    Scarlett. I see what you mean… Gregory`s report is exceptional, on wednesday I got a great new Peugeot 205 GTi from having made $6005 this-last/4 weeks and over ten-grand this past munth. without a doubt its my favourite job I’ve ever had. I actually started 10-months ago and pretty much immediately started making a nice at least $73.. per hour. try this…….. ℂash2.us

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  8. 8. NaggerboyAgnosticoid 2:06 am 01/3/2014

    The same geniuses responsible for throwing money at low-income mortgage approvals and student loans at work here. The medical insurance industry has been boosting the price of medicine for decades, so what to the pointy-headed government meddlers do? More of the same.

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  9. 9. phalaris 3:23 am 01/3/2014

    from Europe : welcome USA to the world of free (for the user) health care. It’s breathtaking that people could have predicted the opposite: but then, they had a political axe to grind.
    Medical costs are open-ended. The only chance of reining them in lie probably with managed-care schemes. But they reek of big-brother, and courts (I think in the USA as well as Europe) tend to undermine them.

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  10. 10. sjfone 6:59 am 01/3/2014

    Negative waves man, get Bill Clinton in here to put a positive spin on things.

    Link to this
  11. 11. SpoonmanWoS 10:34 am 01/3/2014

    So, let’s see…there was a small-scale implementation of something very similar to the PPACA and it produced a set of results. A fairly different program was implemented in another location and it produced different results.

    Not really sure how that means the ACA will be a failure (everything’s still prediction at this point since the ACA only fully came into effect the other day). Perhaps the people of Oregon are just dumber than the people of Massachusetts? Maybe they have more emergency room doctors than general practitioners compared to MA?

    This is exactly the same kind of short-term thinking that exemplifies the right. Since most righties are pro-business, that’s no real surprise as businesses are typically short-term thinkers. Oh, they like to strut and prance like they’re some kind of omniscient visionaries, but the reality is they can’t see beyond their next reporting cycle.

    This is exactly why we can’t allow government to be run like a business, it’s far more efficient when it’s not. Things like giving people access to healthcare take time and planning. Of course there are going to be issues at the outset. They’ll be corrected. But, the reality is, even under the watered-down healthcare provided under the ACA, we’re still infinitely better off than we were prior.

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  12. 12. rkipling 12:58 pm 01/3/2014

    SpoonmanWoS,

    I’m a registered independent who is self-insured. So, all this ACA stuff will not affect me directly. I only say that to indicate I’m not cheering for it to fail as you believe the “righties” are. I grew up poor and remember what it is like.

    The problem with the design of the ACA is fairly simple. By design ACA takes from the middle and upper middle class earners to subsidize or outright give to those who vote Democrat by overwhelming margins. Those from whom money is taken will notice their money leaving. They won’t like it. When the employer mandate kicks in, even more money will be taken, and millions more won’t like it. Those from whom money is taken vote. So, that’s the core problem, and I can’t see a fix for it.

    You give us a suspicion by your reference to “righties,” that you may be a “lefty.” In the absence of examples of government efficiency exceeding that of business (there are none), touting the efficiency of government is just bizarre. You must be informed by your political ideology. While business is certainly not always efficient, businesses can’t print money. Inefficient businesses run out of money eventually. Business is self-correcting. Government can only be corrected by the voters.

    Neither Oregon Medicaid officials nor the ACA designers understand the behavior of those they target for help. Most of their targeted beneficiaries don’t observe appointments. But they know where the closest ER is. For them, the ER was already free. Why change?

    While I make no claim to be a visionary, I believe you should steel yourself to the failure of the ACA.

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  13. 13. jonathanseer 4:07 pm 01/3/2014

    Emergency room visits are hardly a measure of success or failure.

    Only someone rooting for the ACA to fail could see so much in so little especially since in Massachusetts visits did decrease.

    A lottery means the most desperate will constantly play to get access, whereas in Mass. everyone was qualified.

    Massachusetts had a complete risk pool. Oregon did not, thus any assumptions drawn from this single state are dubious and ironic in nature.

    One HUGE factor that nullifies this is that hospitals get paid something for services they used to get paid nothing to perform.

    That means they can be more equitable across the board for more routine services.

    The effects of getting paid something for all the work they used to do basically for free, because the poor couldn’t pay has a ripple in the pond effect.

    The good effects of the ACA are invisible to those who assume its just about the uninsured.

    The very equal partner was hospitals who long have had to shoulder the burden of providing these services without compensation.

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  14. 14. Menno 4:24 pm 01/3/2014

    It seems logical that expanded healthcare would lead to people doing some overdue maintenance. Since they are used to going to the ER it is likely they will go to the ER out of ‘habit.’
    A well designed public campaign could remind people they should visit a GP in stead of the ER.
    You could also choose to get GP’s in house. A triage at the desk can send patients to the GP if there is no Emergency. A similar system is in place in the Netherlands where GP’s are present in hospitals during the night and weekends.
    Lastly you could choose to institute a fine if people visit the ER when there is no reason for them to.

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  15. 15. rkipling 4:25 pm 01/3/2014

    Jonathanseer,

    You make a good point that it isn’t just about ER visits.

    It’s about taking money from one group and giving it to another. That’s what will sink the ACA. Like I said before, the taken-from will not like it. The designers of the ACA should have been sneakier about how they pilfered the money.

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  16. 16. rkipling 4:50 pm 01/3/2014

    Menno,

    The GP associated with the ER is a good idea. Let that be taxpayer sponsored for whoever shows up. That would be far cheaper than the ACA and leave everyone else alone.

    It sounds like you are well intentioned. No offense, but it seems you are unfamiliar with this demographic. Reminding them to go to a GP will not work, and good luck getting them to pay a fine. The GP at the ER makes a lot of sense though. They would use that.

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  17. 17. Dennis2sheds 1:52 am 01/4/2014

    I am a retired masters level hospital social worker with about 30 years experience. Poor and uninsured families have always had to seek health care in hospital emergency rooms. It would have been odd if the study had shown otherwise. A paper like this one would likely not meet peer review standards had it been submitted to a social work journal. The ignorance by academics, politicians, media and the middle and upper classes to the cycle of poverty that plays out in the real world is unbelievable.

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  18. 18. rkipling 5:53 am 01/4/2014

    Dennis2sheds,

    I have no doubt that what you have seen would be unbelievable to most. Does Medicaid improve their plight? What do you think of the GP at the ER idea? How could they best be helped?

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  19. 19. ghcolley 3:44 pm 01/4/2014

    I see quite a bit of cheering over an anti-ACA headline without much analysis accompanying the cheering, as some have pointed out.

    @rkipling: “taking money from one group and giving it to another” is fundamental to many social and economic structures, such as insurance, unemployment, social security for disability, starving children etc, etc. It is a way of transferring risk and reducing the costs of catastrophic loss. The only reason such transfers pose a difficulty for some, in this context, is because they value their money more than the health of others, or even the financial stability of the hospitals who have been covering ER visits by the destitute for years.

    As a country we spend far too much on health care and get far less in return than in most developed countries. We also deny healthcare coverage to millions in the process — whereas in many other places there is lower cost and greater coverage. You seem to prefer an environment where millions are denied basic healthcare so that others (the young who might prefer “no cost” to “a contribution to an insurance pool”, the employed and the employers, the wealthy) can maintain their extra cash in their accounts. The ACA is not under threat in virtue of being “ill-conceived” (it was, after all, conceived by AEI), but rather because a good number of people in this country simply don’t give a shit about anyone but themselves, and are willing to perform all sorts of intellectual and moral acrobatics to try and convince us otherwise. Until that changes, all manner of social progress will fight uphill battles. Things could be better AND more efficient save for the type of resistance you offer.

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  20. 20. rkipling 7:04 pm 01/4/2014

    ghcolley,

    I don’t see anyone here quoting Dickens, “Are there no prisons? Are there no workhouses?”

    I believe you confuse a prediction of what will happen with cheering for the ACA to fail. The problem is that some above the poverty level, who could afford insurance in the past, will no longer find it affordable. Many others will pay substantially more for a poorer quality of insurance (premium, copay, and deductible combined.) These people will likely see this as a significant hit to their standard of living. They will vote accordingly.

    No one was being turned away from ER’s across the country before the ACA went into effect. So, spare us the starving children routine. Spare us the people dying in the streets. Did you not read Menno’s comment about GP’s attached to ER’s? There are ways of addressing the ER cost issue while delivering healthcare to everyone in need. I am unable to read the minds of those who designed the ACA, but my suspicion is that they had two objectives. Yes they wanted to deliver healthcare to the poor (voters), but they also wanted to remove the stigma of receiving healthcare as charity. To achieve both goals, they blew up the entire system.

    Arrogantly, the designers believed they knew how the poor, the young, and the middle classes would behave under their new regime. Their assumptions were wrong. This arrogance comes from the top. Obama has never had a real job. Never having done anything beyond political campaigning, he has no concept of the relative difficulty required to accomplish different tasks. He has no concept or interest in what steps would be needed to complete said task. So, off the designers went, leaderless into the unknown. You see the resulting chaos unfolding. No half competent leader would have attempted the impossible.

    You write as would one of the folk who believe that Communism just hasn’t been tried properly. Human nature is what it is. Not being the Creator, I take no responsibility for the selfishness of human nature. Further, I reject your accusation that my resistance is the source of ACA’s failure. I assure you I touched it not. These words sent out into the ether form no impediment to the ACA. The ACA will collapse all on its own without my interference.

    Any contempt you may read into my words is directed at the ignorance and arrogance of those who have squandered billions on an unworkable system. These ideologues had all the answers and wanted all the glory for their grand achievement. To their chagrin, the glory is theirs.

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  21. 21. L1995 11:53 pm 01/6/2014

    @21,

    “No one was being turned away from ER’s across the country before the ACA went into effect. So, spare us the starving children routine. Spare us the people dying in the streets.”

    How about sparing us the moronic “it was all just fine before the ACA” fantasy routine.

    The fact that hospitals were providing the absolute bare minimum to make someone just healthy enough to walk out of a hospital under their own steam does not equate to actual healthcare.

    The expansion of mediciad has improved the plight of tens of millions of men women and children in this country.

    Or better yet, spare us your inane fantasy that “To achieve both goals, they blew up the entire system.” The entire system is not blown up, not even close.

    Your whining and histrionic ranting shows you to be nothing more than the ideologue you accuse others of being.

    And, while your at it, spare us the government has no success in business fantasy.

    Take a look at the healthcare enjoyed by other nations in the developed world, they get a better system for less money. Thanks to the evil government run healthcare you denounce.

    Link to this
  22. 22. rkipling 2:16 am 01/7/2014

    L1995,

    I haven’t seen anyone say it was all fine before the ACA. Certainly I don’t make that claim. I have no objection to expanding Medicaid rolls. From the studies I’ve read the health outcome for those on Medicaid is little different than just going to the ER, but that’s fine, expand. Menno talked about having 24/7 GP’s at ER’s. That might be an improvement? Improvements in healthcare delivery are absolutely needed. I just don’t have confidence that the ACA will do that. I could argue that your willingness to allow the poor to suffer under Obamacare is heartless.

    What I see happening is a slow motion detonation of the existing insurance system. The insurance industry is complicit with this destruction because they see Obamacare as perpetuating their protection from real market forces. In some markets only one insurance company is offered under Obamacare. Rather than directly addressing the necessity to increase spending on healthcare for the poor, the ACA attempted a slight of hand. The ACA takes from the middle class and above to give to those at 400% of the poverty line (I think it was 400%?) and below. ACA designers didn’t think the taken-from would notice. They noticed. They noticed that their economic situation is worse than before. The taken-from will vote.

    The ACA was designed as a grand social engineering program. Unfortunately none of the designers were engineers. Their assumptions were mostly wrong about how people would respond to the laws various and evolving provisions. Their design approach was hardly better than the monkeys with typewriters plan to reproduce the collected works of Shakespeare. It wasn’t necessary to degrade coverage and care for the many to improve coverage and care for the few.

    Needed improvements which could actually introduce competition and lower premiums could have been enacted, but they were not. Such ideas as allowing competition across state lines and tort reform are among many good proposals. A less grandiose program designed for the poorer among us (I grew up poor and know what it is like.) could have been more effective and less costly. I continue to believe their aim was removing the welfare stigma from healthcare delivery to the poor as much as or possibly more than actually delivering the care.

    I neither whine nor rant. I merely predict and grieve for those injured by this law. I will not be impacted by it personally. It is certainly possible to learn improved healthcare delivery methods from other countries. The Netherlands and Singapore may be examples. Many foreigners with means travel here to receive the best care. Curiously, very many of the top U.S. hospitals caring for these foreigners are not in the Obamacare system.

    Lastly, I don’t believe those turning the cogs of government have evil intent. To the contrary, most I believe are truly well intended. Unfortunately as a collective they are incompetent. Bureaucrats have little incentive to be efficient. Avoidance of individual responsibility is the aim of the bureaucrat.

    Watch as the ACA rolls out and despair.

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  23. 23. llirbo 3:14 pm 01/7/2014

    All these negative comments are poorly aware of the circumstances. The emergency rooms being increasingly visited for non emergency reasons is simply a reflection of the uninsured’s lack of a primacy physician.
    This is far from astonishing. The ACA is a tremendous change for the US, a welcome one at that, and in any large abrupt change, things take a while to settle. So wait a while before squawking like scattered ducks and see what happens once it has been running for some time.

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  24. 24. rkipling 4:59 pm 01/7/2014

    llirbo,

    I really thought, as a country, we had all put anti-duck bias behind us. Speciesism can get so ugly. (I didn’t realize that was a real word until it didn’t get flagged as a misspelling, and I looked it up.)

    Sure, let’s wait to see what happens. It seems pretty obvious, but sure, let’s wait. Do I detect defensiveness on your part?

    Did you not read the post @4 by kalimi, the Medicaid recipient? Wouldn’t it have been wiser plan to ask people like kalimi what would work best for them? I don’t see any evidence the ACA designers made such inquiry. That is the point to this article, yes?

    The issue is how best to provide quality healthcare to those in need. The issue isn’t, as you suggest, whether or not to provide the care. The negative comments are directed at the design of the ACA. I detect no haters-of-the-poor. ……………………… Only the poor, little (choke) ducks seem the object of hate. (Sorry, I got all verklempt. I don’t know if it was the ducks or the ACA?)

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  25. 25. syzygy 5:10 pm 01/7/2014

    llirbo,

    Were you frightened by ducks as a child?

    Link to this
  26. 26. lynnymoore 11:48 pm 01/7/2014

    Menno! Menno! Menno! Most of the rest of you blokes can keep aiming to choke on your narrow carrot…which is dangling in front of you.

    Christine: Pretty shoddy piece of reporting, doll. Next time ask a few questions, interview a few people – you know, journalism.

    Link to this
  27. 27. rkipling 1:08 am 01/8/2014

    lynnymoore,

    Apart from getting the general idea that you disagree with the substance of the article, your comment is content free. This story has run in various media. All reporting seems factually the same.

    If you wish to insult others here, writing in English would better accomplish that purpose. Please feel free to complain clamorously and hurl insults as you like. Let it all out. Perhaps that will be a palliative for your grief over the ACA’s failure. Even your corpulent relative Michael thinks the ACA is terrible. Watch what happens with the ACA and despair.

    Civility requires that I not characterize the debating ability of those who argue by affront.

    Link to this
  28. 28. hkraznodar 4:41 pm 01/9/2014

    Having read the article and most of the comments I have a few points of my own;

    1. The ACA is what we have left after extremist zealots on both sides got done stripping any value out of universal healthcare. It is very poorly designed. The best way to start would be by destroying the insurance ponzi scheme and nationalizing their assets. (this helps pay down the deficit as well as ridding us of parasites. Then look at the successful universal healthcare systems such as Germany (who pay roughly equal total taxes and get better services). If something has proven to already work then perhaps we should use it with minor adjustments for cultural and legal differences.

    2. Round up the hate mongers like Uncle.Al and exile them to Antarctica where they belong. If U.A had anything to add to the discussion that would be one thing but using every article on SciAm as a hate spout is unacceptable.

    3. PTripp and Kalimi had very cogent points – reign in the politicians and look at the actual people involved and the related experts instead of silly talking points.

    4. Could we please, please, please get some spam filtering on these blog posts? Robin250 is a case in point!

    5. The architects of the ACA are not economic illiterates. If they were they wouldn’t be so damned rich. Look at the benefits congress gets and then try to tell me that they don’t know how to game the system.

    6. The insurance industry has been trying to keep healthcare costs low to maximize profits for themselves. Healthcare costs go up because of expensive research into advanced treatments that save lives and improve quality of life.

    7 The American economic system is based entirely on redistribution of wealth. Every business that employs someone is taking the value of that employee’s work and in most cases stripping the majority of the value off as profits. This unfair redistribution of wealth is inherently corrupt. The vast majority of the poor work very hard and are paid a meager fraction of the value of their work. Taxing the most corrupt and exploitative for their sleaziness is a good way to address that unfairness. Imposing a strict limit on the ratio between the highest paid person and/or owner at a company for total compensation and the lowest paid of around 10 to 1 sounds pretty fair. That way you can be as rich as you want as long as your employees get a big chunk of compensation too. Well paid employees can afford their own healthcare

    8. Welfare systems that pay people to do nothing are stupid. I’ve worked with mild schizophrenics, Autistics, epileptics, blind, deaf, paraplegics and mentally retarded (yeh I know it isn’t politically correct but it is medically accurate so go get stuffed if you don’t like it). All of them did productive work. Unless you are paralyzed from the neck down or a vegetable, there is work you can do. If there isn’t useful work then we can have you move stacks of rocks (or count them as they are moved). Once you get the stack moved you get paid. The next day you move it back. If jobs pay decent and welfare doesn’t allow laziness you will find that unemployment and poverty are virtually nonexistent. Anyone that can’t support the child or children they have should be on reversible sterility until they are able to support them.

    9. The only thing worse than a 2 party system of politics is a one party system.

    Link to this
  29. 29. rkipling 6:47 pm 01/9/2014

    hkraznodar,

    Interesting. Well let’s see how to respond to you?

    While I agree that Uncle.AI may be a bit lacking in tolerance, shipping people you don’t like off to a very cold, isolated place is reminiscent of Uncle Joe. That would be Uncle Joe Stalin not Biden. Who exactly would decide which of us gets sent to the gulag? You? I do agree more civility would improve comments. I read hateful comments which come from all sides. Beyond filtering out hate speech, I wouldn’t recommend filtering by point of view. But moderation is the purview of the individual blogger as he/she sees fit.

    Dr. Ezekiel Emanuel, brother of Rahm, is one of the designers of the ACA. I’ve read his epistles on the matter and seen him interviewed on TV. This guy is an ideologue who made some very wrong assumptions about how people in various demographics would react to the provisions of the ACA. He graduated from medical school, but he appears ignorant regarding how insurance works. For example, most people under 35, who rarely need medical care, will not choose to overpay for insurance. Since preconditions are no longer a disqualification, they will wait until they need the insurance to buy it. They are not super bright. But they aren’t stupid. That’s just one example.

    I’m not going to defend the *&^%$** insurance companies. A better plan would be to have them compete across state lines. In some markets under the ACA a single insurance company has a monopoly. A lot of money could be saved by opening up competition in various ways. Trial lawyers wouldn’t like it, but Tort Reform would also reduce premiums. In any event, private companies would be far more efficient than HHS running the program. $600 MM for a clunky website that is insecure?

    It’s highly unlikely I could successfully explain capitalism to you, so I won’t try. Maybe I can give you the general drift of running a candy store. Let’s say you start a candy store. You put up your own money to rent or buy the location, acquire all the licenses and permits, buy candy wholesale for inventory, hire and train employees, etc., etc. All your investment money is at risk. There are no guarantees customers will buy enough retail candy to even cover your costs much less make a profit.

    If you have never been responsible for meeting a payroll, you may not know all the costs and government reports (city, state, and federal) there are before you even get to providing employee healthcare. It takes a lot of work just to keep up with that. Employees have to be paid whether you have any profit or not.

    So, you have taken all the risks with your own money. Let’s say you have managed to make a profit. You may wish to share profits with your employees? Shouldn’t that be your decision how much to share if at all? In your scenario, someone outside your business, a commissar perhaps, would decide how much of your profit you get to keep. Consider that there was no guarantee you would even make a profit to start with. You could have lost some or all of your investment. I’m not sure about the percentage, but a rule of thumb used to be that 95% of new small businesses failed within 5 years.

    So, give that a think, Comrade. Running your candy store is far more complicated than just raking in and hoarding money.

    Not everyone makes an equal contribution to a business. Without a potential economic incentive for economic reward, very little of modern society would exist. What you describe as a desirable social system is a command economy. Every command economy that has been tried keeps all but the elite rulers in poverty.

    Link to this

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