INTRODUCTION

The quality of medical care is regulated in a number of different ways. Some forms of regulation seek to assure medical quality prospectively, by setting standards of entry into different spheres of medical practice. Some seek to assure quality retrospectively, by punishing, correcting, or weeding out practitioners who have proven themselves incompetent or unethical. Unregulated markets, of course, control for quality to some extent: on the prospective side, persons with substandard qualifications have a difficult time attracting customers in a competitive market; on the retrospective side, those who perform a service badly have a difficult time getting paid for it, and those who develop generally poor reputations are unable to hold their patients’ custom. It is now commonplace to note that the market for health care services – plagued as it is by information deficits and agency problems – is not an efficient self-regulator. Market mechanisms must therefore be augmented by law: prospectively by licensure requirements and standards governing medical training, and retrospectively by license revocation proceedings, criminal prosecutions, and private medical malpractice suits. Today's medical practitioners must not only compete for patients and payers; they must also be licensed, be graduates of schools whose curricula meet national standards, and be willing, if they err, to face the possibilities of malpractice liability, state licensing board investigation, professional discipline, and even criminal sanction.