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What the State Cannot Provide (first draft) — part 2 of 4

Source: public/assets/writing/humanstructures/What the State Cannot Provide (first draft).docx · humanstructures

Coolidge was not a universal restrainer, and honesty requires naming where he acted. He signed the Immigration Act of 1924, which imposed national-origin quotas and restructured the American labor market for four decades. He maintained the Fordney-McCumber tariffs at average duties of approximately 38 percent, inviting the retaliatory restrictions that would help collapse world trade in the next decade. He took no meaningful action against Prohibition, which had produced a black market of enormous scale and the criminal infrastructure historians have documented. In each of these domains, the pathologies the framework predicts followed directly from the intervention. The immigration restrictions distorted labor markets for a generation. The tariffs produced the trade contraction. Prohibition produced the criminal economy. What is striking about Coolidge’s record, read honestly, is not that he restrained everywhere. It is that the framework’s prediction held both where he restrained and where he did not. His administration is a controlled experiment with treatment and control conditions inside a single presidency, and the within-case variation confirms the pattern rather than complicating it.

The framework predicts the failure of these interventions ex ante from their structural features. Tariffs that raise the price of imports above the price of domestic substitutes invite retaliation; immigration quotas that prevent labor from flowing to its highest-value uses produce the labor-market distortions that follow from any binding price ceiling on labor mobility; Prohibition that suppresses voluntary transactions in a desired good produces the black market that follows whenever price-suppressed demand persists. These are structural predictions, not pattern-matched after the fact.

Coolidge’s monetary record is more complicated, and honesty requires acknowledging what he did and did not control. The Federal Reserve was an independent institution, and Coolidge did not direct its policy. The 1920s Fed, under Benjamin Strong at the New York Reserve Bank, conducted what Milton Friedman and Anna Schwartz later called an “active, vigorous, self-confident policy,” using open-market operations to maintain price stability through the decade. Whether that policy contributed to the conditions for 1929 is contested: Austrian economists following Rothbard argue that stable consumer prices masked underlying credit inflation that should have produced deflation, while Friedman and Schwartz, writing from the monetarist tradition, explicitly praised the 1920s Fed and blamed the Depression on the contraction of 1929–1933, which occurred after Coolidge had left office. Both schools blame the Fed for the Depression; neither blames Coolidge. The popular narrative that “1920s excess” caused the crash, which hardened in the decades after 1929, is not supported by either serious school of monetary thought. Coolidge’s own posture toward the Fed was the same as his posture toward most institutions outside his direct authority: he left it to competent technicians and did not interfere, which is itself a form of restraint, and one consistent with the record as a whole.

The most revealing moment of his presidency came in August 1927. He was vacationing in the Black Hills of South Dakota. He summoned the press, handed each reporter a slip of paper, and asked his secretary to distribute them. The paper contained a single line: I do not choose to run for President in 1928. No elaboration, no follow-up, no interview. His wife learned of the decision from the press. He was popular; the Republican Party would have nominated him; he would almost certainly have won. When party leaders kept pressing him, he instructed Everett Sanders to travel to Kansas City and tell state delegation leaders not to vote for him at the convention.

In his memoirs he explained briefly. The Presidential office takes a heavy toll of those who occupy it and those who are dear to them. If I take another term, I will be in the White House till 1933. Ten years in Washington is longer than any other man has had it — too long! The explanation is terse but contains a theory. The office corrodes its occupants. Continued possession of power generates pressure to use it. The restraint that characterizes early tenure becomes harder to sustain with each passing year. Coolidge understood something about the gradient he operated in that most politicians either do not understand or understand and cannot act on. He removed himself from it voluntarily at the peak of his popularity, rather than continue and watch his own principles erode under the pressure of incumbency. So far as I can determine, it is the only instance in American history of a president walking away from certain reelection for reasons of principle rather than health or scandal.

What happened afterward is the part that makes Coolidge useful as illustration. Within eight months of his leaving office, the stock market crashed. Within four years, his successor’s successor had begun assembling the New Deal. The McNary-Haugen principle Coolidge had blocked twice at political cost returned in 1933 as the Agricultural Adjustment Act, establishing federal price supports, paying farmers to reduce production, laying the foundation of the modern American agricultural subsidy system. The Mellon-Coolidge tax cuts were reversed; top marginal rates rose above 60 percent by 1936 and above 90 during the Second World War. The federal budget, stable through the 1920s, has not in nominal terms been lower than Coolidge left it in any year since. The national debt, paid down to $16.9 billion in 1929, passed $200 billion by 1945 and has never been reduced in absolute terms across a presidential term since.

None of these reversals is particularly surprising on its own; each can be defended as a response to the Depression or the war. What’s instructive is the speed and completeness with which Coolidge’s restraints were undone, and the ease with which the reversals were accomplished politically. Farm subsidies, once reinstituted, became a permanent feature that has survived every subsequent administration of both parties for ninety years. The income tax cuts, once reversed, were not restored to Coolidge-era levels by any subsequent president. The budget discipline, once abandoned, has been restored in isolated years but never re-established as a governing principle. The institutional structures Coolidge had refused to build were built anyway within a decade of his departure, and they have persisted through every subsequent realignment.

This is exactly what the framework predicts. The farm subsidies not created, the tax increases not enacted, the programs not established generated no political constituency while being sustained. The people who benefited from their absence did not know they were benefiting; the counterfactual economy in which the interventions had been enacted was not available for comparison. When the restrainer left office, no career depended on continuing his restraints, and many careers could be built on reversing them. The ratchet turned in one direction, as it was always going to.

The historiography completed the pattern. In the 1948 Schlesinger survey of historians, which set the template for modern presidential rankings, Coolidge ranked twenty-seventh of thirty, in the below average category, one place above Warren Harding at the bottom. Subsequent surveys have kept him in roughly the same position. Schlesinger Sr., summarizing his methodology, observed that low-ranked presidents believed in negative government, in self-subordination to the legislative power, while top-ranked presidents left the executive branch stronger and more influential than they found it. The criterion was not hidden: presidents were to be ranked by the extent of their action, and restraint was a marker of mediocrity. Five of the top ten in the 1996 Schlesinger were war leaders. The economic record, the budget, the debt, the tax rates, the growth, the employment, the absence of inflation, did not enter into the rankings in any weighted way, because the rankings were not designed to detect it. They were designed to reward visible exercise of executive power.

The rehabilitation of Coolidge through Robert Sobel’s 1998 biography and Amity Shlaes’s 2013 Coolidge has recovered the outlines of the record but has not substantially altered his historical ranking, which is itself a datum. Restraint, even when restored to visibility through sustained scholarly effort a lifetime later, does not generate the kind of reputation that visible action does. The shape of the reputation is set by the gradient, and the gradient does not update on new information except slowly and at the margins.

Coolidge is the framework’s best-available positive case, and the within-case variation is what gives it force. The domains where he restrained produced the outcomes the framework predicts restraint produces. The domains where he didn’t restrain produced the pathologies the framework predicts intervention produces. This is consistent evidence, from inside a single administration, that the mechanism operates as described. The speed and completeness with which his restraints were reversed after he left office is itself evidence for the political-economy argument of the preceding section. Restraint does not build a protected constituency. Good things happen where it’s practiced, bad things happen where it isn’t, nobody notices the first and everyone notices the second, and within a generation the good things are undone.

The next case is what happens when restraint is never attempted, and the asymmetry runs unchecked for three-quarters of a century in a single sector.

IV. The National Health Service

In 2012, Danny Boyle’s opening ceremony for the London Olympics included a sequence in which dancers in nurses’ uniforms performed around illuminated hospital beds while children bounced on mattresses. The sequence was broadcast to roughly 900 million people. It was the British state’s chosen image of itself at a moment of maximum international visibility: not the monarchy, not the industrial revolution, not Shakespeare, but the National Health Service. Nigel Lawson had written decades earlier that the NHS was the closest thing the English have to a religion, and he meant it descriptively. Criticism of the institution is treated by the British political mainstream not as a policy position requiring rebuttal but as a moral failing requiring correction. Every major party opens its electoral materials with affirmations of commitment to the NHS. Its logo appears on government communications that have nothing to do with healthcare.

This matters for what follows, because any honest examination of NHS performance takes place inside a frame in which examination itself is suspect. The civic religion is not incidental to the institution’s political success; it is the political success, operating exactly as the framework would predict. The NHS’s founding built a protected constituency: NHS staff whose livelihoods the institution anchors, suppliers whose revenue depends on its contracts, patients who either get short-run access to care or cannot imagine any other system in which they could afford it. It disarmed the opposition by making criticism readable as betrayal rather than as policy disagreement. And it removed the evidence against which the capture could be evaluated, because the parallel British system that would have provided the counterfactual has been prevented from existing for eighty years. These three features are precisely what sustain the NHS against the evidence of its own performance. A Briton who notes that the British Post Office performs poorly relative to its European peers is making a neutral empirical observation. A Briton who notes the same about the NHS is understood to be signaling a political identity. This is the visibility asymmetry at terminal stage: not merely a distribution of attention favoring action over restraint, but a civic vocabulary in which the outcomes of the institution cannot be named without leaving the tribe.

It is worth saying plainly at the outset that I am not claiming the NHS is uniquely catastrophic, nor that some other country’s health system should be adopted in its place. I am claiming that the NHS is a useful case because it shows what state direction of a sector produces when the asymmetry runs without visible braking for three generations.

Consider the NHS on its own terms, against its own stated targets. As of February 2026, the referral-to-treatment waiting list in England stood at 7.22 million cases, representing roughly 6.1 million unique patients. Approximately one in ten English adults. Of these cases, 122,668 patients had been waiting more than a year for treatment that the NHS’s own constitutional standard commits to providing within eighteen weeks. The eighteen-week standard itself has not been met since 2016; the current figure is 62.6 percent against a target of 92. The waiting list peaked at approximately 7.77 million in September 2023, larger than the population of Scotland. It has declined slightly since but remains, in April 2026, higher than at any pre-2020 point in NHS history.

In accident and emergency, 40.4 percent of patients waited over four hours in December 2025, against a constitutional target of no more than 5 percent. The average category-two ambulance response time for strokes and heart attacks stood at 32 minutes and 29 seconds, against a target of 18 minutes. The Royal College of Emergency Medicine, using a standard mortality ratio derived from peer-reviewed emergency medicine research, estimated that 16,644 excess deaths occurred in England in 2024 as a direct consequence of A&E waits of twelve hours or longer before admission. This is approximately 320 deaths per week attributable to a single sub-category of NHS delay. The RCEM’s president characterized the figure as equivalent to two aeroplanes crashing every week. The figure was up from 14,000 in 2023, which was itself up from 23,000 in 2022 by a different methodology. Whatever the precise number, the category is in the tens of thousands per year, from a single measurable form of delay, within a single part of the system.

Cancer outcomes are consistent with the emergency picture. Stage-at-diagnosis distributions, time-to-treatment for symptomatic presentations, and patient-reported access all show the UK lagging Western European peers across the most common cancers. The exact magnitude is contested in the comparative literature; the direction and persistence are not.

These figures are not a crisis in the sense of a sudden departure from baseline. They are the baseline, extended across decades. The waiting list did not begin in 2020; it was four million in 2019, three million in 2013, and has been a persistent feature of NHS operations since the 1950s. The eighteen-week standard was not missed once; it has been missed every month for nearly a decade. The excess deaths in A&E are not a one-year spike; the RCEM has produced similar figures every year for four years. None of this is compatible with the usual explanation that the NHS merely needs more funding. NHS spending, measured as a share of GDP, was approximately 3.5 percent in 1950. It reached 5 percent by the late 1970s, 7 percent by the mid-2000s, approximately 9.7 percent by the early 2020s. In absolute terms, real spending per capita has multiplied several times over. The system has absorbed substantially more resources every decade, and every decade the basic picture has remained the same: persistent shortage, missed targets, and a steady flow of avoidable deaths distributed across an administrative apparatus too diffuse to attribute any specific death to any specific decision.

What the numbers describe is not a crisis of funding but the structural output of a system operating without prices. This is the Mises-Hayek prediction rendered in clinical statistics. The NHS allocates roughly £200 billion annually across every aspect of healthcare provision, primary care, emergency services, elective surgery, mental health, specialized treatments, without using the mechanism that, in every other sector of the British economy, allows dispersed information about scarcity and demand to be aggregated continuously into signals producers and consumers can act on. In place of prices, it uses targets: the eighteen-week standard, the four-hour A&E target, the sixty-two-day cancer target, hundreds of subsidiary metrics cascading down through hospital trusts. Each target is a bureaucratic attempt to reconstruct, through political specification, the information a price system would generate automatically as a byproduct of transactions. The targets fail not because the people administering them are incompetent but because no target apparatus, however elaborate, can substitute for the aggregation function prices perform. The system does not know how much emergency capacity is needed in Manchester next Tuesday because no signal exists that would tell it. It estimates, allocates, and manages shortage.

The shortage, having no price, manifests as queue. This is the distinctive feature of rationing in state-directed healthcare: demand does not equilibrate with supply through price adjustment but through the patient’s willingness and ability to wait. The waiting list is not a failure mode of the NHS. It is the NHS’s allocation mechanism. The question of who gets treated this week and who gets treated next year is answered not by the interaction of demand and provision but by administrative triage operating on a queue of fixed length relative to capacity. When capacity rises, the queue falls; when demand rises, the queue extends; when neither changes, the queue persists. The system has no internal mechanism that would cause the queue to disappear, because the absence of a queue would mean the system was not operating at capacity, which no political authority could defend to taxpayers funding it. The steady-state output of a priceless allocation system is chronic shortage expressed as waiting, and that is what the NHS has produced, continuously, for seventy-seven years. The Kirznerian failure compounds this. The organizational form of NHS care, the hospital trust, the GP partnership, the referral pathway, has not substantially changed since the 1970s, because the entrepreneurs who would have tested alternative forms have not been permitted to enter the sector.

The 16,644 excess deaths from A&E waits in 2024 deserve separate consideration, because they are the cleanest available dataset on the Type II graveyard in any developed economy. No single one of these deaths can be traced to a specific decision by a specific administrator. Each was the product of a sustained condition of shortage acting through the statistical probability that a patient waiting eight to twelve hours for admission is more likely to die than one admitted within four. The bodies are buried in ordinary cemeteries, their death certificates listing the proximate causes, cardiac arrest, sepsis, respiratory failure, that brought them to A&E in the first place. They are not counted as deaths from NHS policy in any official statistic. The RCEM figures exist only because a medical college independently performed the calculation and publicized it. They register in the news cycle for a day when released and are not otherwise mentioned. No public inquiry has been convened. No minister has resigned. No constituency exists whose political identity is built around these dead.

Compare this to the political weight of the Lucy Letby case, in which a neonatal nurse was convicted of murdering seven infants. The Letby case has produced a public inquiry, multiple parliamentary debates, major legislative and regulatory reviews, years of front-page coverage, and a sustained national argument about NHS culture and oversight. Letby is the Type I failure: visible, named, politically legible, with identifiable actors and identifiable decisions. The 16,644 annual deaths from A&E delays are the Type II graveyard: statistically real, structurally caused, politically weightless. The asymmetry between the two is not a moral failing of the British political system. It is the operation of the gradient I have been describing, at the scale of thousands of bodies per year, in the institution the British political system is least capable of examining. Seven named victims, the political apparatus can engage with. Sixteen thousand annual deaths from A&E delays, more than two thousand times Letby’s total, every year, produce a single RCEM press release. The apparatus cannot engage with them because there is nothing for it to engage with. No names, no story, no characters, no decision to reverse. This is the shape of the Type II graveyard, and the NHS produces it at a scale that in any domain with visible failure modes would long since have collapsed the institution generating it.

The third failure is in competitive discipline. An NHS patient who receives poor care has no meaningful outside option. The alternative to the NHS is private provision incentivized to supply only what the government does not, or, where it does compete, to supply heavily differentiated services. The hospital trust that performs poorly loses no business; the provider whose outcomes lag has no competitor bidding for its patients. Indeed, said provider would often prefer to have fewer patients to deal with. The absence of the exit threat is what produces the quality degradation the figures document, and what allows the degradation to persist across decades of funding increases that in a competitive sector would have produced continuous improvement.

At this point the defender has a case to make, and it deserves to be engaged. The strongest version runs roughly as follows. The moral claim is that the ill should be treated regardless of their status. Healthcare therefore should not be a market transaction, which discriminates heavily by wealth. The NHS is the institutional embodiment of the moral claim. Empirically, the Commonwealth Fund’s most recent international comparison ranks the UK third out of ten developed countries on overall health system performance. The NHS has survived eight decades with near-universal public support, across every political realignment. It provides healthcare free at the point of use to everyone resident in the country, regardless of income, employment, or immigration status. Whatever its problems, it is a more just arrangement than leaving medicine to markets.

Each of these claims needs a different response. The moral claim should be conceded without reservation. Illness is not shoes; healthcare is not a consumer market; the person with kidney failure needs dialysis or dies, and a society that allocates dialysis purely by willingness to pay has made a statement about itself that cannot be rescued by efficiency arguments. Granted. The question is not whether universal coverage is a legitimate moral goal, it is, but whether the NHS, as an institutional form, delivers on the moral goal it claims. The figures suggest it does not, in any straightforward sense. A system that maintains 7.22 million people on waiting lists, kills roughly sixteen thousand per year through emergency delays, and produces cancer survival rates among the worst in Western Europe is failing the people whose protection that moral claim was meant to guarantee. The moral stakes of healthcare do not insulate the institution from scrutiny. They make scrutiny obligatory. A serious moral commitment to the sick is what produces the willingness to examine whether the institution claiming to serve them is in fact doing so.

The Commonwealth Fund ranking deserves engagement rather than dispute. The UK does rank third overall in the 2024 edition, behind Australia and the Netherlands. What the ranking actually shows, on inspection of the subscores, is strong UK performance on equity and administrative efficiency combined with middling performance on access and weak performance on health outcomes. The third-place finish is driven by the first pair, not the second. On the dimensions that matter most to individual patients, whether they can access care when they need it, and whether that care produces the best available outcome, the UK’s performance sits near the bottom of the ten-country comparison. The ranking is not wrong; it is measuring a composite that includes dimensions where the NHS performs well. But the weak performance on outcomes and access is consistent with everything else this section has documented, and the procedural dismissal of the ranking’s critics (“the report is designed to critique the US”) is a weaker argument than the subscore analysis it has been substituting for. The 2024 Darzi report, commissioned by the current British government from a former Labour health minister with impeccable credentials as an NHS defender, concluded that the institution is in serious trouble with public satisfaction at its lowest recorded level. When the NHS’s own friends, commissioned by its own political protectors, produce that verdict, the question of whether the moral promise is being delivered becomes harder to avoid.

The solidarity claim is the deepest of the three, and I will return to it directly in the closing section. The briefest response here is that the identification of moral universalism with a specific 1948 organizational form is historically contingent, not necessary. That illness should not be a market transaction does not entail that the state must directly employ every doctor and own every hospital. Many countries honor the moral claim through structures that look nothing like the NHS, and the assumption that the British civic religion around state monopoly provision reflects the moral claim itself, rather than a particular institutional implementation of it, is the counterfactual gap operating as theology.

What the NHS demonstrates is not that Britain chose the wrong model or that reform should proceed toward some other institutional form. It demonstrates what happens when state direction of a sector is allowed to compound across three generations under conditions that prevent the failures from being seen the way the failures of consumer goods are seen. The calculation problem produces the shortage. The shortage manifests as the waiting list. The waiting list produces the deaths. The deaths produce the RCEM press release. The press release produces nothing. And the civic religion ensures that the entire chain is treated, by the political system that would otherwise be expected to respond to it, as the price of having something sacred rather than as the output of a particular administrative choice that could be made differently.

V. The American Confusion

The objection most frequently raised against the preceding diagnosis is that the American healthcare system demonstrates what happens when markets are permitted in healthcare, and that its pathologies vindicate the NHS by comparison. The US spends nearly eighteen percent of GDP on healthcare against the UK’s roughly ten percent. It produces lower life expectancy. It leaves tens of millions without adequate coverage. It bankrupts families who get sick. If markets were the universalizing force I am claiming, American healthcare should be the cleanest demonstration. Instead it looks like the strongest case against the thesis.

The objection deserves a direct answer, because the argument cannot survive if the American system is what markets in healthcare actually look like. The answer is that it isn’t. The American healthcare system is one of the most heavily regulated sectors in the American economy, and almost every pathology the defender points to is the direct product of specific state interventions whose effects can be traced historically. What the American system demonstrates is what happens when markets are prevented from operating while the appearance of private provision is maintained.

Begin with the most consequential single fact about American healthcare: that most Americans receive their insurance through their employer. Roughly 160 million people are covered this way. In no other developed country does the employment relationship determine insurance access at anything like this scale. The arrangement is not a market outcome. It is a direct consequence of wartime wage controls. In October 1942, Roosevelt froze wages by executive order to manage wartime inflation. The War Labor Board, needing to permit some flexibility in a tight labor market, ruled in 1942 and 1943 that employer-provided health and pension benefits would not count as wages. The IRS followed in 1943 with a ruling that exempted employer-paid premiums from employee income tax. Congress codified the exclusion permanently in the 1954 Internal Revenue Code. Employer-sponsored health insurance rose from nine percent of Americans in 1940 to sixty-three percent by 1953. This was not the market discovering that employer sponsorship was the efficient model. It was a generation of workers and employers responding to a tax preference whose magnitude, in today’s terms, runs to several hundred billion dollars per year in forgone federal revenue.

Every major pathology the defender attributes to the American market flows from this one intervention. Pre-existing-condition exclusions existed because insurance was tied to employment rather than individually owned across a lifetime; when you changed jobs or got sick between jobs, you entered a new underwriting pool. Job lock, the phenomenon where workers cannot leave bad jobs because they would lose health coverage, is a pure product of the linkage. The third-party-payer structure that prevents patients from seeing prices or shopping for care exists because the tax code made it vastly more efficient for employers to buy insurance on behalf of employees than for employees to buy it themselves. A functioning individual market, in which people bought portable coverage they kept across jobs and unemployment, never developed at scale in the United States because federal tax policy made it irrational to try. The market the defender gestures at does not exist. It was strangled in the cradle by the 1943 IRS ruling, and everything built on top of the resulting structure is an attempt to manage the dysfunctions produced by the original distortion.

Next, the hospital sector. In thirty-five American states and the District of Columbia, it is illegal to build a new hospital, expand an existing one, or in many cases purchase major medical equipment such as an MRI machine, without first obtaining a Certificate of Need from state regulators. CON laws were introduced in New York in 1964, federally mandated in 1974, and although the federal mandate was repealed in 1987, most states retained their programs. Hawaii operates twenty-eight different CON restrictions; North Carolina, twenty-seven. The process typically requires the applicant to demonstrate community need, which incumbent providers are permitted to contest, and routinely do. In June 2023, a Tennessee administrative law judge blocked Vanderbilt University from opening a forty-two-bed hospital in Rutherford County after three existing providers argued there was not sufficient need for another facility. Vanderbilt had already received initial state approval; the process was reopened at the request of its competitors.

This is not a market. It is state-enforced incumbency protection of the kind European economies dismantled in the nineteenth century. Kaiser Family Foundation work has found healthcare costs roughly eleven percent higher in CON states than in non-CON states. A 2024 study found that repealing CON requirements for ambulatory surgical centers produced a forty-four to forty-seven percent increase in such centers overall, and a ninety-two to one hundred and twelve percent increase in rural areas, without any of the quality collapse CON defenders predict. The Department of Health and Human Services formally recommended in 2018 that states repeal their CON laws. Most have ignored the recommendation, because the constituencies benefiting from state-enforced monopoly, the existing hospital systems, have more political weight than the diffuse constituencies of patients and potential entrants harmed by the restriction. The framework operating exactly as predicted, but this is not a feature of markets. It is a feature of markets prevented from functioning by state action.

The pharmaceutical sector tells the same story at different scale. The FDA approval process for a new drug costs, by the most widely cited estimate, approximately $2.6 billion and takes ten to fifteen years from initial research to market. The agency’s own filing fee for an application with clinical data rose to $4.3 million in fiscal year 2025, nearly double its level a decade prior. These numbers are not the outputs of a market sorting efficient from inefficient producers. They are the height of a regulatory wall, and their effect on market structure is what any economist would predict: the drug development sector consists of a small number of very large firms capable of absorbing billion-dollar compliance costs, surrounded by a cloud of smaller firms whose business model is to develop promising molecules to the point where they can be sold to the large firms for commercialization. The six-to-ten-firm concentration of big pharma is the natural consequence of an entry barrier the state built and maintains.

Medicare and Medicaid together account for approximately forty percent of American healthcare spending. Before proceeding, this fact deserves to be stated plainly: no sector in which the government directly pays for forty percent of the output can be characterized as a market. The pricing, reimbursement rates, covered procedures, and quality standards set by federal payment policy dominate the behavior of every hospital system and most physician practices in the country, because those systems derive a plurality or majority of their revenue from federal programs. When people speak of American healthcare as private they are describing the nominal ownership structure of the providers, not the economic character of the sector they operate in.