In terms of health care, how did we get where we are today? What most people call our “health care system” is anything but a system. It’s a mix of health insurers, hospitals, doctors, employers and their army of lobbyists on the front-line in our nation’s capitol protecting their financial interests.
Opponents of the current effort by Congress to reform health care scream that if it passes the government will takeover the entire health care “system.” If that happens, the free market won’t function properly because the government will strong-arm the industry to artificially reduce costs.
Of course, even a cursory examination of our current health care system reveals that it is not a free market.
First of all, health insurance companies are allowed to collude and fix prices because of an anti-trust exemption dating back to the 1940s.
But the biggest anti-free market component of our health care system is the employer-provided shenanigans.
Employers have been setup as the middleman between customers and the health insurance industry. This separation of customer from service provider has been a great way to hide the real cost of health insurance. Most workers have no idea how much their employer pays for their health insurance premiums. It’s kind of like the hidden payroll taxes, but that’s another story.
You see, health insurance is provided by employers as a benefit. And like all benefits, it costs the company money. Now theoretically, if your company wasn’t paying hundreds of dollars a month for your health insurance premium, you’d make more money or the business would be able to hire more people.
The actual health care cost for the average worker is about $500 a month.
If you really believe in the free market, you’d support eliminating employer-provided health insurance. How much your employer currently pays for your premiums could be added to your paycheck. And then you can go purchase your own health insurance, or just buy health care without insurance.
Of course, for this to work, we’d need to do something about that anti-trust exemption, but it would be a start.
A free market can not work if the consumer doesn’t know what they’re purchasing and how much it costs.