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As lawmakers consider more business regulation, experts offer a better path

As lawmakers consider more business regulation, experts offer a better path

Dustin Hurst
February 19, 2015
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February 19, 2015

As Idaho lawmakers consider restrictive licenses on two professions, genetic counseling and sign language interpreting, experts warn against adopting new regulations, saying they won’t help consumers.

They also say the state has better options to ensure quality, low prices and easy entry into the market.

“Licensing does not guarantee high quality,” warned Sanford Ikeda, an economics professor at the State University of New York.

Ikeda told IdahoReporter.com on Thursday that even though the state can empower oversight of the two professions, it can hardly ensure consumers will receive excellent service.

“Things, being the way they are, in reality, that’s not going to happen,” Ikeda said of everyone following the letter of the law. “What’s specified in law, and what happens in reality, are very often two different things.”

The two professions vary widely. Genetic counseling is working with prospective parents to examine possible fetal abnormalities of babies in a mother’s womb. Sign language, on the other hand, is simply interpreting for the deaf and hard of hearing.

Interested parties, though, believe they have a valid case for adopting new state regulations for each profession, rules that would outlaw people from practicing without state approval.

Genetic counselors warn their profession is too sensitive to be without regulations. Interpreters, too, want to ensure good service, especially in high-stakes arenas, like courtrooms or medical offices.

But Ikeda said the market is already optimized for regulation. “I think regulation is important, but regulation doesn’t necessarily mean government has to regulate,” he said.

Edward Timmons, associate professor of economics at Saint Francis University, echoed that sentiment. “With the advent of online rating sources, like Yelp and Angie’s List, it’s becoming easier for consumers to find information about practitioners,” Timmons said. “You could do some research online and find this information yourself.”

Timmons just co-authored a study detailing just how little licensure helps the markets -- and how much it actually harms consumers.

“Many licensing laws do not clearly increase public safety and ought to be re-examined by policymakers,” Timmons and co-author Anna Mills explained. They found, after studying licensure for opticians, quality didn’t necessarily rise, but prices did.

“What has typically been found is that wages of the professionals increase,” Timmons told IdahoReporter.com. “There really hasn’t been evidence licensing improves quality for consumers.”

Both professors said policy makers have a tool that could help, though: certification. That means interpreters or genetic counselors would only have to pass a skills competency exam to work in the respective fields. That would help ensure adequate skills, but wouldn’t bar anyone from practicing without certification.

“Customers can see that rating and decide if they want to be served by that person,” Ikeda said of certification tests. The state could tier certifications, which could prepare practitioners for specialized situations, like courtrooms or medical offices.

Certification, Ikeda noted, would also allow greater competition because practitioners don’t have to operate under the same rules, but have greater flexibility to adapt to market conditions.

Neither professor would claim to know the motives of the licensure backers in Idaho, but both suggested they’d found some commonalities as they’ve studied the issue.

“It’s not consumers groups that are stepping forward,” Timmons said. “It’s the practitioners.
They gain and consumers lose, unfortunately.”

Ikeda described why he believes some parties seek licensure. “I think part of it is habit,” he said. “We live in a world where there is a lot of regulation. We take it for granted. “

There may be, he added, some genuine concern in the Idaho Capitol. “Many of them, I would assume, are sincerely concerned about quality and serving customers.”

But, Ikeda pointed out, some with lesser intentions might be trying to write themselves a special perk. “People are pretty smart and they know how to game the system,” he said. “If you erect a legal barrier, that’s going to be to your own advantage.”

Timmons suggested Idaho lawmakers think twice before approving new license requirements, as they are nearly impossible to roll back. “Once it’s enacted, it’s not easy to get rid of,” he said. “They should think very carefully before enacting these laws.”

Timmons said he and other researchers could only find eight cases of lawmakers ending licensing requirements in an exhaustive study.

Both bills await full hearings in front of Senate committees.

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