>There's absolutely variation in what people will tolerate, and substitution of quality of goods.
Really, are you a rational economic actor when your life is on the line? That's the reason why the market inevitably breaks down in healthcare. I'm not saying that a market never works in healthcare, just that it will inevitably fail when it is solely based on laissez-faire principals.
>(Also, it's not that something is "inelastic to demand", it's the supply or demand itself that is inelastic. Specifically, the quantity supplied or demanded does not change significantly as a function of market price.)
You're just nitpicking here as you know full well what the meaning is here. Specifically, when we're talking about elasticity in healthcare, quantity demanded or supplied is for most part inelastic to price. Hence the supply curve shifts, exacting a much higher price to the market participants due nature of the goods/services supplied and humans' innate needs conflicting with market principals.