Abstract

The free market theory has as its basis the assumption of equity. This equity is ascribed to both purchasers and providers in a perfectly balanced system so that there are seen to be no 'winners' or 'losers' in the market-place. The health system that is developing in the UK is structured as a managed market, but agency relationships between GPs and health authorities buffer the costing process of goods and therefore may be described as distorting the price. This could also be distorting the ability of the users, who are the real purchasers, from exercising their economic freedom. They may also lose the autonomy to choose goods that suit their particular needs, and equally not to choose those services that they do not want or wish to pay for vicariously (i.e. that the common good is respected by both providers and purchasers). This assumes that users of the service know the level of choice that they have and that not only are providers protected at present by the practices of the purchasers but also entry into the market for new providers is severely curtailed. The exercise of true freedom of the market in economic terms is one of moral obliga tion to provide services that not only have a market value that is affordable and a require ment of the 'common good' but also are historically acceptable for social requirements (i.e. that the services are valued as fundamental tenets of the rights of individuals in soci ety). The expression of this need will therefore be utilitarian (i.e. the users of the services should benefit from them rather than the providers)