Question

(3) Why is the medical arms race less a problem today than it once was?

Answer 1

The medical arms race was for example the competition between the hospitals over the patients, which forced the hospital to for example focus on the interior design.

However, more recently the competition is focusing on efficiency, with the hospitals giving health care more efficienty receiving more money. One of the reasons for this change is the Medicare Prospective Payment Systems which specifically rewards efficiency.