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In the absence of even a minimal state, how could the spread of infectious disease be prevented?

This entry is part 3 of 9 in the series The Pandemic Bites

In the previous post, we explained the role of markets in working out public health solutions, but we can take these ideas even further.

Health insurance (and insurance in general) is well-understood to be a market good, despite how governments are constantly at work subverting regular market activity surrounding its production. Insurance is best understood as a means of reducing the impact from uncommon occurrences through management of risk. This comes with a cost, of course, and the actuarial sciences are used to develop plans at reasonable costs where the customer is insured in an agreed manner and the insurance company makes a profit to do so. Hence, most elective medical procedures (like cosmetic plastic surgery) are not insurable since they do not arise from unanticipated future events, whereas a broken arm from an accident is. 

Still, a health insurance company wants its customers to be healthy, since the less often customers are sick and in emergencies the more profit they make due to fewer claims needing to be paid out. So an insurer is incentivized to be on the lookout for infectious disease outbreaks and perhaps even be involved in medical research that deals with infectious disease. They will maintain lines of communication with researchers in academia and nonprofits to stay on top of the latest advances and global health phenomena so as to be best informed about what’s happening in the areas relevant to public health. Collaboration with other market organizations would enable the insurer to have access to data and disseminate information and treatments to halt disease transmission or mitigate the effects. There’s no requirement for physical force for such a company, as it is in their interest to protect their customers. A good relationship with their customers will imbue trust, and the reputation of the insurer for reliable information and recommendations will build a virtuous cycle of building public health around their behaviors. The insurer knows that the moment they lose that trust, the customer can go somewhere else for the service since they are free to choose an insurer on the free market. Consortiums of insurers might occur to pool resources and research about infectious disease thereby reducing costs and increasing access to information. The resulting environment will not eliminate disease entirely, and problems can certainly ensue. However, considering what we have seen from state-managed public health in the past years, the above model would likely be more efficacious than our current experience.

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