Reflecting on the Controversy Surrounding Medical School Enrollment in Korea

If Milton Friedman Had Witnessed the Korean Medical School Enrollment Controversy

Milton Friedman, a giant in free-market economics, argued that the benefits created by labor unions were essentially stolen from non-union members who would otherwise have received those benefits. Among the various labor unions in the United States, the one that Friedman considered most impenetrable was the American Medical Association (AMA), a professional organization for physicians.

The AMA was founded in 1847 with the lofty goal of "improving public health and advancing medicine." However, Friedman argued that the AMA was nothing more than a cartel designed to protect its members' interests by blocking competitors from entering the medical market through measures like restricting medical licenses.

One of the examples he cited was the AMA's response when a large number of German Jewish doctors fled to the United States after the Nazis came to power in the early 1930s. Up until that time, anyone who graduated from medical school in the United States could take the medical licensing exam without any other conditions. However, the AMA suddenly proposed that "U.S. citizenship" be made a mandatory requirement. It was essentially an attempt to prevent the German Jewish refugee doctors from practicing medicine in the United States.

Considering that German medicine was, and still is, considered one of the best in the world, Friedman believed that the AMA's argument wasn't about protecting patients, but rather about safeguarding the interests of American physicians.

During the Great Depression in the 1920s, the AMA became even more blatant in its efforts to protect its members' livelihoods.

When the government tried to increase the number of physicians, the AMA countered with the argument that "if the number of doctors increased, their incomes would decrease, leading to unethical medical practices." This effectively put a brake on the government's initiative.

This is a recurring argument in South Korea today.

The Korean Medical Association (KMA) has recently opposed the government's plan to expand medical school enrollment, arguing that "an increase in the number of doctors will lead to excessive medical treatments and the collapse of the national health insurance system" or that "an increase in medical school enrollment will lower the quality of medical education."

Excessive medical treatments, which are akin to theft, are a matter of individual physicians' professional and ethical standards. Measures to prevent excessive medical treatments may include stricter enforcement and penalties against physicians or enhanced ethics education, but they have no relation to medical school enrollment.

The claim that increasing medical school enrollment will lead to an increase in excessive medical treatments sounds like a self-deprecating joke that portrays all doctors as potential criminals.

In a lecture delivered after receiving the Nobel Prize in Economics in 1976, Friedman also said, "If there is any scientific evidence that proves a correlation between an increase in the number of doctors and an increase in unethical medical practices, please present it to me." While there are attempts to introduce models like "supplier-induced demand" for which empirical research is lacking, these models are not considered valid answers to Friedman's question.

Similarly, the claim that expanding medical school enrollment will compromise the quality of medical education lacks sufficient evidence. Even if, hypothetically, the medical education environment were to deteriorate, it would be the responsibility of the education authorities and universities to address the issue. It is not a matter for the medical community to interfere with when the possibility of a decline in medical education quality is uncertain.

Friedman analyzed that American physicians, by controlling medical market competition through restrictions on license issuance, were able to increase their income by 17% to 30%. Recent studies show that the average annual salary of a physician in the United States is $350,000 (approximately 460 million won), which is at the top of various professional fields.

The same is true for South Korea, where medical school enrollment is strictly controlled. According to the National Tax Service, the average income of physicians in 2021 was 269 million won, significantly higher than other professional fields.

In 2020, the average income of lawyers was 40% of that of physicians, compared to 60% in 2014, indicating a widening gap between the two professions. Of course, in a capitalist society, it's natural for professions in high demand to receive higher compensation. However, the situation changes if a particular professional group attempts to utilize restrictions on competition to secure higher compensation.

Correcting such market distortions is the government's responsibility. It may not be easy to persuade a group that holds immense influence in our society, but consumers suffering from supply shortages will applaud the government's bold measures to normalize the market.

{Source: [Special Correspondent's Perspective] If Milton Friedman Had Witnessed the Korean Medical School Enrollment Controversy (msn.com) Go Il-hwan, 2023. 11.}

Both the American Medical Association (AMA) and the Korean Medical Association (KMA) oppose government policies, arguing that an increase in medical school enrollment could lead to excessive medical treatments and a decline in the quality of medical education.

However, it's important to note Milton Friedman's claim that "the American Medical Association (AMA) is nothing more than a cartel designed to protect its members' interests by blocking competitors from entering the medical market through measures like restricting medical licenses." If their arguments are truly pure and rational, they should be able to defend themselves against such criticisms.

Personally, I believe that establishing a medical referral system (primary, secondary, and tertiary medical care systems) and implementing appropriate medical fees and medical systems should be prioritized. To achieve this, the government, medical organizations, and consumers (the public) need to engage in lengthy discussions to find common ground. Subsequently, the discussion on medical school enrollment should be approached from the perspective of balancing supply and demand within the overall medical market.

The income of medical professionals after graduating from medical school can be determined based on national economic growth and average per capita income. However, it would also depend on the government's approach to healthcare services, whether it opts for a fully public healthcare system, a hybrid public-private healthcare system, or a fully private healthcare system.

Each of these three healthcare service models has its advantages and disadvantages. The country should carefully choose the model that best suits its needs and establish a solid foundation for its healthcare system.

Most countries are aware of the advantages and disadvantages of socialist and Commonwealth countries that prioritize public healthcare and the United States' healthcare system, which maximizes private healthcare services based on a free market economy. However, it seems that no country can boldly implement reforms due to the power struggle between politicians and related interest groups and the self-serving interests of politicians involved in formulating healthcare policies.

November 5, 2023, Cham Gil