Insurance Companies Play Doctor, Politicians Play Favorites

As we saw in an earlier section, under the guise of protecting the public, government reduced the supply of physicians. We assume that a licensed healthcare provider is more competent than someone who is not licensed. To obtain a license a provider must first complete the required training and then pass an examination.

What about corporations? A corporation is a separate legal entity created by the government. A corporation cannot be trained or take an examination. In Washington State, healthcare providers can form a special form of corporation called a professional service corporation. All owners of the corporation must be licensed in one of the listed professions. The idea seems to be that everyone has a license to lose and will have an incentive to act ethically.