The Decline of Local Government

You might want to take a look at this piece by Simon Haeder at The Converation. In it he explores the history of public hospitals in the United States and the effect that Medicare and Medicaid have had on them:

The U.S. could potentially even have ended up with a British-style, government-run health care system. Yet, the country went a different route. Instead of expanding, public hospitals have been closing since the 1960s in large numbers. How come?

In my recent academic paper on the subject, I analyzed the creation and closure of public hospitals in California, the state with one of the most extensive public hospitals system in the nation. My findings indicate that when state and federal governments extended health coverage through programs like Medicaid and Medicare, all but the most well-resourced local governments in turn began closing their hospitals.

My findings bear implications for policy debates today. Advocates for any large-scale health reform effort such as Medicare-For-All should be mindful of the eventual unintended side-effects they may trigger.

That may be surprising to some but it isn’t to me. It’s completely consistent with what I’ve been saying. Federalization neuters local governments. It doesn’t expand the services available at the local level but decreases them for most people.

3 comments… add one
  • steve Link

    You should follow the link to his own synopsis of his study. There he says the following.

    “counties that could afford public hospitals continued to maintain them, while poorer, needier counties closed them.”

    Medicine began radical changes in the 60s. Medical care become more expensive and technologically driven. You just didnt go to hospitals anymore to lie around in bed until you died. Next add in that most of these public hospitals were in rural areas or poor sections of the city. Since we have taken over and turned around several of those public hospital I have gotten to know their histories pretty well. It got to be more and more difficult to hire decent staff at the public hospitals since they couldn’t afford to pay well, their school systems were bad (I have been inside the schools) and people didnt want to live in the area.

    So these hospitals were already on the way out. The old days when every community hospital had an OB service and they delivered 100 baby a year was nice, but no one can afford that anymore, plus the morbidity and mortality rates at places like that were sky high.

    Please note that public hospital accept Medicare and Medicaid payments. Even accepting those payments they just needed way too much support from the community, at a time when rural communities in particular (since he is talking about California county hospitals) got older and poorer.


  • TarsTarkas Link

    Steve: When my father was growing up (in West Virginia) there was a word for it: Gotothehospitalanddie. Back then you didn’t go to the doctor, the doctor visited you at your house. Hospitals back then were effectively hospice care, except for the well-to-do. Sulfa had only recently come into use, and antibiotics were still gaining traction.

  • steve Link

    We still see that a bit at one of our tiny rural hospitals. When i see a pt too sick to be cared for at that place I tell them they need to go to our tertiary care center. They sometimes refuse because they think we send people there to die. There is a bit of truth to it.

    The other thing forgot to mention, among many, is that those community hospitals were very dependent upon female labor. They got a lot of it for free since women were stay at home moms. The nurses were also fairly cheap as their salaries were kept low, especially in rural areas.


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