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Why Making A Profit In Health Care Is Good

What Adam Smith said about the butcher, the brewer and the baker is equally true in health care. You can’t be successful in the medical marketplace unless you are meeting other peoples’ needs. The more needs you meet, the more successful you will be. Profit is one measure of how much good you are doing.

A profitable medical enterprise is one that takes resources that have a value elsewhere in the economy (as measured by the cost) and creates even greater value for consumers/patients (as measured by the revenue). By contrast, a loss implies that resources are being used in a way that is less valuable than their use in producing something else.