Why Market Competition Hasn’t Brought Down Healthcare Costs

Each attempt to fix the problems has led to more administrative red tape

It’s easier than ever to buy stuff. You can purchase almost anything on Amazon with a click, and it is only slightly harder to find a place to stay in a foreign city on Airbnb. So why can’t we pay for healthcare the same way?

My research into the economics of healthcare suggests we should be able to do just that, but only if we say goodbye to our current system of private insurance—and the heavy administrative burden that goes along with it. Republican efforts to repeal the Affordable Care Act (ACA) would take us in the wrong direction.

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Comments

What explains elective surgery?

Market competition has brought down the cost of elective surgeries such as Lasik, breast implants, liposuction, etc. Granted, these are not typically covered by insurance but the prices have come down without a single-payer model.

Could this be part of the solution? Health insurance for catastrophic situations and pay-as-you-go for health maintenance and minor health problems. This seems to work well for auto insurance provided by for-profit companies. (Imagine how the situation would change if auto insurance was required to cover oil changes.)