Everything has a cost, even efficiency.
The equity-efficiency tradeoff happens when economic growth in a market both increases in efficiency and decreases in how equity is distributed. This tradeoff can happen the other way too, suggesting that, if we want more equally distributed equity, we may have to give up some efficiency.
The equity-efficiency tradeoff doesn’t necessarily apply to all economies, but it does to certain economies that we humans find important, like healthcare. Talking about maximizing efficiency of production for a factory is one thing; talking about maximizing efficiency in healthcare is another. In healthcare, ideally, health would be the priority over efficiency. Some believe that equitable healthcare is a right. Others argue that equitable healthcare would be better for society and the economy as a whole by preventing undue societal costs.
Applying cost-minimizing, profit-maximizing economic models to healthcare means models that treat low-income patients differently than high-income patients, since maximizing profits means maximizing the willingness to pay with services for different incomes. Plus, efficiency in healthcare can result in mistakes, and one-size-fits-all processes that don’t reflect individual health needs.
And you thought efficiency was always cost-saving…