Market based health care reform
is the proposal of this article (which only those who subscribe or have institutional access can actually read). It is compelling about how the government makes things worse:
Unfortunately, a handful of U.S. public policies prevent markets for health services from accomplishing this objective. In two areas—tax policy and health insurance regulation—government policy has actively hindered the operation of markets. In three other areas—the provision of health care information, the enforcement of antitrust laws, and medical malpractice rules—government policy has failed to adequately promote the proper functioning of markets. In doing so, it has contributed to the spread of wasteful (inefficient) medical practice, rising health care costs, and rising rates of uninsurance. Although makingmarkets work is not a silver bullet, it is a necessary first step.They point out that making employer sponsored health insurance but not other forms of spending on health tax-deductible has led to an overreliance on insurance as opposed to out of pocket spending. Solution: make out of pocket spending and individually purchased insurance tax-deductible as well, and give tax credits for the poor to buy insurance. Health savings accounts would also be expanded.
They go on to talk about how over-regulation has made the insurance market non-competitive. For example:
One particular form of state insurance regulation—benefit mandates—has expanded dramatically over the past forty years. In 1965 there were fewer than a dozen such mandates throughout the fifty states and the District of Columbia; by 2003 the number had risen to more than 1,800. Benefit mandates now require coverage of off-label drug use (thirty-seven states), acupuncture (eleven states), and chiropractic (forty-seven states). According to the Congressional Budget Office (CBO), states’ benefit mandates have raised the cost of a typical insurance plan 5–15 percent. According to one study, about one-quarter of those who lack coverage are uninsured because of the cost of state mandates alone.So insurers in 47 states are forbidden from offering policies that exclude chiropractic. I wish I had the choice to save money by forgoing this form of health care. They propose a federal (versus the current state) market for insurance to make things simpler and cut back on this kind of wasteful regulation (although I'm skeptical that Congress would do any better).
If you can get access, read the article. Whatever one thinks about universal health care, I think proposals for a single payer are not realistic in the current political environment, so this kind of incremental reform is what we need.