Doctors Charging Fees for Cannabis Prescriptions

Also available at Cannabis in Canada.ca

Licensed Producer Tilray showed the National Post unsolicited invoices from two doctors, three clinics, and two “patient aggregators” that work with health professionals. All of them requested payment, or even a share of cannabis sales for referring patients to LPs. Kickbacks, in other words. Doctors and clinics are referring patients to LPs for money. They are charging as much as $350 per patient for medical cannabis prescriptions and since the MMPR is the only legal way for new patients to acquire cannabis, these prescriptions bind the patient to the LP. Unless the patient decides to find another doctor, and pay another fee, he or she is registered with that particular LP for life.



The National Post reported that most doctors ask for $50 per patient – a reasonable price. Doctors and clinics have been outspoken about the fact the money is used to cover the costs of verifying patient information, and other resources that must be used for the administrative costs of healthcare. It's a sore point among Canadians, but the same principles that led to the downfall of the Soviet Union are behind the erosion of our healthcare system, namely, the consequences of a “priceless” system, where kickbacks, bribery, and corruption become the order of the day. But more importantly, the fundamental structure of the system is on unsound footing. If the Colleges of Physicians and Surgeons in Ontario and British Columbia actively punish doctors and clinics that prescribe cannabis for cash (setting aside the issue with the LPs) then we know what will happen.

First, we have to acknowledge how uncivilized this practice is. Not charging fees for prescriptions, but that of banning voluntary exchange. To forcibly prevent others from exchanging wealth for health is morally incomprehensible. If two grown adults consent to an exchange, what right does a third-party have to intervene? Even if one gives that right, it doesn't circumvent the economic consequences of interfering with free prices. Voluntary exchange among a large number of people results in a “matrix” or market of goods and services. Prices bring about a harmony with the quantity supplied and the quantity demanded. No central planning body has ever successfully replaced or repeated this spontaneous development of civilization. All governments have done is maintained law and order (and rather badly). Allocating resources to their most highly valued purposes can only be achieved when prices are sending the correct signals to entrepreneurs. This only happens when millions of people are making decisions free from the consequences of price manipulation.

Prices are a more civilized way of rationing goods and services than the decisions of a government bureaucracy. If this weren’t true, then all the socialist regimes of the 20th Century would be communist paradises by now. Instead, they devolved into tyranny and eventually collapsed or became crony-capitalist, like the West. When prices aren't allowed to perform their functions, something else will. If doctors can't charge money-prices, then they have no way of affecting the demand for their services other than making people wait. That's one reason why the Canadian healthcare system is notorious for its wait-times: There are no monetary exchanges, so the healthcare monopoly must rely on administrative procedures. These procedures are cutoff from market prices that act as surrogates of information on supply and demand. Without these price signals, the healthcare monopoly is inevitably bureaucratic. The wait-time becomes the clearest expression of price. Which is a shame, because a doctor can't take the time the patient waited for him and then go exchange it for another good or service. He can, however, do that with money.

With this in mind, we are now in a position to examine why the Colleges of Ontario and BC, and Health Canada, should not be “looking into the issue” for violations of “ethical conduct.” The issue is the MMPR and the federal government's prohibition of cannabis. A crackdown on charging fees is only to misconstrue what the real issue is. If doctors and clinics are successfully prevented from charging more fees, we can expect a wait-list for cannabis prescriptions. Is that better? Unable to ration with prices, clinics will ration with time. But if the wait-list decreases, the number of people looking for cannabis prescriptions will increase. If one makes an appointment with a clinic with the purpose of getting a prescription for cannabis, where that appointment ranks on his or her value scale is going to be dependent on whether the wait-time is four hours or forty-minutes. People unwilling to wait four hours to see a doctor will be willing to wait forty-minutes. And those willing to wait four hours are obviously willing to wait forty-minutes. The demand for cannabis prescriptions increases as the price (i.e. the wait-time) goes down. One can imagine the number of applicants if the wait-time was ten minutes and the doctor was prevented from charging a fee.

Of course to get to that point would mean hiring more doctors, right? Well, suppose a clinic that has been charging $50 per patient is now forced to see patients for free. Instantly there is a wait-list since the administrators have no common denominator to level-out supply and demand. Someone gets the idea of just hiring more doctors. Notwithstanding a doctor shortage (another consequence of our healthcare system and close proximity to the incentives in America's crony-capitalist system), adding an additional doctor may allow for twenty or forty more patients per day to get their prescription. This initially reduces the wait time, but the shorter wait time will induce additional people to seek their prescription.

It's the same principle as above: a forty-minute wait (as opposed to a four hour wait) will incentivize more people to get their prescription. Adding doctors only increases capacity and puts a larger strain on resources without addressing the never-ending supply of people demanding free healthcare. This means that the monopoly healthcare system will only cost more and more as time goes on. Without voluntary exchange, the system acts as a financial parasite on the productive sectors of society. But it doesn't need to be this way. Doctors, surgeons, nurses and health-care professionals create value for Canadians everyday. Why can't we express this value as wealth?

Absurd laws keep cannabis on the black market, since a working prohibition is a statist fantasy. The courts have ruled that cannabis can be legally produced, exchanged, and consumed for medical purposes. Special interests mixed with an outdated ideology lead to the creation of the MMPR. The result is a patient going to a clinic with an actual medical problem and getting charged money for the prescription that allows them to exercise their constitutional right. Patients outside the Allard injunction are prohibited from growing their own and are forced to buy gamma-irradiated “dried marihuana” from an LP at above-market prices. The problem has been and will continue to be the MMPR – not the idea that a clinic or doctor may actually want to charge a money-price for their good or service. That's something that other professionals do every single day. It's called voluntary exchange, also known as consensual adult decisions.