“A Free Market Can Fix Health Care”
The Cato Institute’s ’s Director of Health Policy Studies, Michael Cannon, is the author of a new Policy Analysis, “Yes, Mr. President, A Free Market Can Fix Health Care, published earlier this week. Following is the the policy analysis' executive summary:
“In March 2009, President Barack Obama said, "If there is a way of getting this done where we're driving down costs and people are getting health insurance at an affordable rate, and have choice of doctor, have flexibility in terms of their plans, and we could do that entirely through the market, I'd be happy to do it that way." This paper explains how letting workers control their health care dollars and tearing down regulatory barriers to competition would control costs, expand choice, improve health care quality, and make health coverage more secure.
“First, Congress should give Medicare enrollees a voucher and the freedom to choose any health plan on the market. Vouchers would be means-tested, would contain Medicare spending, and are the only way to protect seniors from government rationing.
“Second, to give workers control over their health care dollars, Congress should reform the tax treatment of health care with "large" health savings accounts. Large HSAs would reduce the number of uninsured Americans, would free workers to purchase secure health coverage from any source, and would effectively give workers a $9.7 trillion tax cut without increasing the federal budget deficit.
“Third, Congress should break up state monopolies on insurance and clinician licensing. Allowing consumers to purchase health insurance licensed by other states could cover one-third of the uninsured without any new taxes or government subsidies.“The great advantage of a free market is that innovation and more prudent decision-making means that fewer patients will fall through the cracks.” (emphasis added)
“Finally, Congress should reform Medicaid and the State Children's Health Insurance Program the way it reformed welfare in 1996. Block-granting those programs would reduce the deficit and encourage states to target resources to the truly needy."
We would add tort reform to that list of four. Most importantly, though, is maintaining a free market rather than attempting a government takeover of the world’s finest health care system, not to mention muzzling the system with legions of bureaucratic constraints.
Take some time to read the entire policy analysis (requires Adobe); we think you’ll agree Mr. Cannon’s prescription for health care reform is a logical starting place for health care reform.