Treat health care like free-market business

Throughout history, no economic system has been more successful in delivering the highest possible quality at the lowest possible price than a free-market system of informed consumers and ethical suppliers. It's time we put this time-tested tool to work where it is so badly needed — our health-care system.

The free market motivates entrepreneurs to increase our standard of living by offering a wider array of goods and services that are affordable by more consumers. Three years ago President Bush signed into law a bill allowing insurance companies to offer health savings accounts. Since that time millions have enrolled, including a large portion who did not previously have insurance. The premiums for the high deductible plan associated with a health savings account have increased more slowly than the premiums for traditional health plans. In fact, in many cases premiums have actually gone down.

Despite the evidence, some question whether consumerism can manage health-care costs without sacrificing patient quality. These critics argue that health care is not subject to supply-and-demand forces like groceries, cars or Nintendo GameBoys. Examining two key aspects of the health-care system will show how this argument fails to recognize the fact that health care would benefit from free-market forces.

First, consider nonurgent and well-patient care. These common health-care services have the same economic attributes of any other commodity. The patient or customer has ample time to shop around and get competing bids for his or her business. By paying cash from a health savings account for the service, the patient is not tied to any one doctor, set of doctors or clinic. Based on the severity of the symptoms, a patient may choose not to even see a doctor but to see a nurse practitioner or physician's assistant at a lower cost. In fact, a number of large retailers are opening walk-in clinics to serve patients with common maladies such as strep throat and ear infections. In the case of strep throat, it takes a simple five-minute test, administered by a doctor's staff member, to verify the type of infection before prescribing the proper antibiotic, if one is needed. Convenience, affordability and no loss of quality are all accomplished by giving consumers a choice.