The underlying problem here is that the consumer doesn't care what the cost of their drugs are; all they do is sign on the dotted line when the doctor recommends something.
Insurees are essentially paying a monthly cost for an effectively unlimited pool of medical funds. As long as the bill is above what their copay costs, they couldn't care less how much the drug costs - if anything, they will choose the drug that costs more than what the nearly identical drug costs so they can 'get their money back.' As long as the consumer is separated from the consequences of their choices, costs will continue to rise. Some kind of incentive for people to actually care about the cost of their decisions needs to be engineered into the system.
Suppose, perhaps, that instead of mandating that employers provide insurance to full-time employees, the government mandated that employers provide catastrophic insurance and contribute the remainder of the difference between the old system and the new to a kind of Health Savings Account: something that's tax-advantaged, and can only be used to pay for healthcare. Employees would then pay their medical bills directly from this fund, and funds will continuously build if they're not used. The kicker is that this HSA also doubles as a retirement fund, and any funds left over when retirement age is reached can be withdrawn without penalty. People will see the money as theirs, and will be much more careful about how they spend it, thus putting pressure on doctors and healthcare providers to reduce prices, rather than increasing them.
This took me ten minutes to think up. Give me half an hour, and I'll work out most of the kinks. Give a team of professionals a few weeks, and I'm sure that we could come up with something that makes infinitely more sense than the ridiculous hodgepodge of special interest legislation and twisted incentives that we have now.
Its the system and its players that overall are corrupt, not just the rules.
For example. Someone will be paid a bonus to make sure the average retirement account is emptied. The average american woman has about 2 kids, so we'll charge about 40% of an average lifetime account "earnings". After all we can either directly or indirectly select any price we'd like.
Another example would be some weirdness with plastic surgery where the cost would now directly correlate solely with human emotional response to a procedure rather than difficulty of the surgery.
Finally I think you'd have some pretty weird and borderline inhumane situations with respect to just barely under retirement age patients getting sick... Feel a lump? Well your grandkids will never go to college, or your kids will never live in a house, etc, if you seek treatment before retirement. Just wait a couple months / years, after all what could possibly go wrong with untreated cancer or heart disease or diabetes?
Now if you could roll over the treatment fund directly to your kids, that sounds great until (grand)parents start offing themselves so their kid can afford treatment.
"Give a team of professionals a few weeks"
Fox guarding the henhouse, you'll end up with something at least as corrupt if not more so than the existing solution.
You are ignoring that there are competing providers. In a competitive market, no one provider can maintain a price that is designed to "empty" an HSA account.
There is, of course, no competitive market in health care, its a natural monopoly and one side of the market is (intentionally?) completely uneducated.
Insurees are essentially paying a monthly cost for an effectively unlimited pool of medical funds. As long as the bill is above what their copay costs, they couldn't care less how much the drug costs - if anything, they will choose the drug that costs more than what the nearly identical drug costs so they can 'get their money back.' As long as the consumer is separated from the consequences of their choices, costs will continue to rise. Some kind of incentive for people to actually care about the cost of their decisions needs to be engineered into the system.
Suppose, perhaps, that instead of mandating that employers provide insurance to full-time employees, the government mandated that employers provide catastrophic insurance and contribute the remainder of the difference between the old system and the new to a kind of Health Savings Account: something that's tax-advantaged, and can only be used to pay for healthcare. Employees would then pay their medical bills directly from this fund, and funds will continuously build if they're not used. The kicker is that this HSA also doubles as a retirement fund, and any funds left over when retirement age is reached can be withdrawn without penalty. People will see the money as theirs, and will be much more careful about how they spend it, thus putting pressure on doctors and healthcare providers to reduce prices, rather than increasing them.
This took me ten minutes to think up. Give me half an hour, and I'll work out most of the kinks. Give a team of professionals a few weeks, and I'm sure that we could come up with something that makes infinitely more sense than the ridiculous hodgepodge of special interest legislation and twisted incentives that we have now.