Health Care In America: The Case for A Privatized System 

Ever since the 2008 Presidential election, the United States has seen a massive debate in the area of health care policy with those on the left arguing for a larger role for government in healthcare. While broadly speaking those on the right have argued for less government intervention in the area of healthcare.

There have been two significant areas of discussion in this debate on health care with one being the moral aspect of healthcare: The first example being papers published by ethics advisors in the Clinton administration on the supposed moral superiority of a single-payer health care system when the executive branch was pushing for a universal health care bill in the early 1990’s until Republican Senators were able to stop the bill (Sade 464).

The other important aspect of the healthcare debate is the empirical debate over whether government run healthcare is efficient? Which would include examples such as when prominent Republicans cite the Oregon Medicaid study showing that any health benefits from Medicaid are statistically insignificant (Baicker, et al.) So therefore the US should move towards a privatized health care system because it will offer cheaper, better quality care. Also, because it is immoral to spend taxpayer money on healthcare, rather than allowing them to keep their money and spend it as they wish.   

A First Step: The Obamacare Replacement Act

Five days after President Trump was inaugurated Senator Rand Paul revealed the draft of a new bill titled “The Obamacare Replacement Act (S. 222)”. With the revelation of this proposal for a law, he unveiled a bold new vision for a significantly more market-oriented system which can be used as a springboard to later pass a gradual repeal of the Social Security Act Amendments of 1965, which established both Medicare and Medicaid. Both of which have been disasters for the United States Healthcare system.

The first issue that the bill aims to fix is the Obamacare mandates, and this issue is fixed extraordinarily easily by just repealing the mandate that every individual must buy health insurance or pay the penalty. It would repeal the mandates on employers that every business must purchase insurance for every employee that works at least 30 hours a week if the company has 50 or more employees. The proposed law would also repeal the mandate that health insurance plans must contain what the Affordable Care Act considers to be “essential health benefits” along with other insurance mandates within the Affordable Care Act.

After two years Rand Paul’s plan would return to a pre-Obamacare policy on pre-existing conditions, it would reinstate HIPAA but after the two-year deadline insurers would be able to consider health status when deciding how to charge someone or whether to accept that person into their insurance policy. The next principle of the Obamacare replacement act changes the law so that health insurance premiums are not only tax deductible for employers but also for people buying on the individual market. The largest part of the Rand Paul healthcare proposal is the expansion of HSAs which he takes a multiple step approach to doing. These steps are a tax credit of up to $5,000 a year for money contributed to Health Savings Accounts, thus removing the cap on contributions to essentially allow an unlimited amount of money to be put into HSAs.

The Obamacare Replacement Act would repeal the requirement that people in HSAs must be enrolled in a high-deductible plan, allows people to use HSAs to pay for their medicine, allows people to use HSAs to pay for their insurance premiums, and allows people to use their HSAs to pay for five other types of expenses. Senator Paul’s proposal protects HSAs from being seized when bankruptcy is declared, allowing HSAs to roll over to family members, and allows the elderly to contribute money into their own MSAs.

Rand Paul’s plan would allow doctors who provide their services for free as charity to deduct what they would typically charge for that charity procedure from their taxes. The S. 222 bill would allow individuals to group together to buy health insurance as a group so that they can spread risk (an example that Rand Paul has given is that the 3 million plus members in the NRA can group together for a health insurance policy). This law would get rid of the lines around the states in buying health care by allowing individuals to purchase the health insurance they want regardless of which state the company is based.

Furthermore, this law would also allow for association health plans where small businesses can group together to buy insurance plans in a similar way to the individual market group reform. This piece of legislation would improve the anti-trust laws in healthcare and would increase states flexibility in changing their Medicaid programs, and lastly, this bill would stop considering stop loss coverage as health insurance, so that rule makers are unable to restrict its availability. The passage of this bill would be a great victory for the American people and is an action that should be taken by the Senate as soon as possible in pursuit of a more market-oriented health care system.  

Three Possible Properties: Pick Two 

In healthcare there are three properties that people want to have in a system, these properties are universality, high quality, and affordability.

The problem is that it is only possible to have two of the three. A universal healthcare plan which is affordable and high quality only exists in a Bernie Sanders fantasy land but more on that later. If a country were to have a low-cost single payer plan, the quality would be awful like in Canada. Now if a system were implemented where coverage was universal and high quality this system would be extraordinarily expensive like the projections for a single-payer system in the U.S. (Aaron).

However, if a system is trying to achieve high quality and affordable coverage for the vast majority of people. Then the solution that would lead to those results would be the free market argues, Michael Tanner, in “Hard Truths about Health Care.”   

Michael Tanner’s Hard Truths About Healthcare

In his article about healthcare, Michael Tanner points out six facts about healthcare that quickly destroy the notion that a bureaucrat in Washington D.C. should be the person in charge of the country’s healthcare:

1. The first hard truth is that health care is simply a commodity, therefore, healthcare is not a right, because if the government were to guarantee healthcare as a right, it would require them to take away rights from taxpayers and doctors.

2. The second hard truth is that coverage and access is not the same thing, in fact with programs such as Medicaid there is no correlation what so ever. This is seen in the New England Journal of Medicine’s study of the Oregon Medicaid program where their results showed that any health benefits achieved as a result of Medicaid coverage were statistically insignificant.

3. Thirdly mandating coverage of pre-existing conditions leads to an adverse-selection death spiral where insurance companies raise their prices, and then people who are young and healthy leave the market causing insurance companies to raise their prices even higher due to a higher concentration of uninsurable people being covered by them.

4. Fourth, is that Medicare is not a successful program, Mr. Tanner goes on to point out that Medicare has a long-term projected debt of 58 trillion dollars. He then points out that Medicare is an inherently inefficient program (he cites a study showing that areas with high per-patient Medicare spending don’t produce better results than low spending areas) because Medicare pays based on service rather than the quality of service.

Since this program is in such bad shape, it would be a dreadful mistake to transition it into a program for everyone which is something that would cost taxpayers more than four trillion dollars every year (Aaron).

5. Fifth, he points out that even before the passage of the Affordable Care Act and it subsequently being signed into law, the United States did not have a privatized system or even anything resembling this. Before the Affordable Care Act, the United States still had Medicare Medicaid, and extensive regulations as the Mr. Tanner States:

“Other markets in goods and services routinely produce lower prices and better quality. Health care has always been different precisely because free-market competition and consumer choice have been missing”.

In fact when you look at one of the small segments of healthcare that is largely deregulated and operates on cash rather than a third party system. The most market-oriented area of healthcare seems to be Lasik eye surgery and just like common sense with regards to economics would appear to suggest in a complete contrast to the mostly government-controlled areas of healthcare, the quality of Lasik eye surgery has risen drastically at the same time as the price has gone down by an average of 25% (Rosario). The final point that Michael Tanner makes is that no health care policy is popular.

In reality the ACA isn’t popular, the AHCA isn’t popular, and neither is single payer. Therefore, Republicans should stop putting so much focus on what is popular because nothing is, and instead they should put that focus on doing what is right by passing a full repeal of the Affordable Care Act by passing the Obamacare Replacement Act. This should be followed by further free market reforms that would allow for actual competition which would boost the quality of health care while at the same time driving down the costs of health care.  

Healthcare Is Not a Right But Rather It Is A Commodity 

The most overlooked thing in the healthcare debate besides from the fact that the most cost effective way to run health care is in a free market (Aaron) (Baicker, et al.) is that Healthcare is not a right, but rather it is a commodity (Shapiro).

Although Twitter is not usually the greatest place for information, there are two specific tweets that when combined give a great insight into the healthcare debate. So one day this crazy old man named Bernie Sanders in one of his normal 1930’s style quasi-Marxist style tweets about how unfair he perceives America to be he says:

“People go to the doctor because they’re sick, get a diagnosis from their doctor, but they can’t afford the treatment, How crazy is that!”

Syndicated columnist and New York Times best-selling author Ben Shapiro responded to this with:

“I go to a fancy store to check out a piece of furniture, can’t afford it. That’s totally crazy!”

His point in saying this was not to imply that furniture and health care were just as necessary for people’s lives. Rather his point was to show that both health care and a couch are commodities and just like with every other commodity the free market is the best way to provide them to many people with high quality and low cost. He cites in the article to the admiration by Justice Ruth Bader Ginsburg of the South African constitution which declares health care a right and consequentially South Africa has some of the worst health outcomes in the world, with have an average lifespan of 57 years.

Due to the artificial declaration of a right to healthcare, a right to housing, a right to education, and many other so-called positive rights – South Africa has demolished its economy with a GDP per capita of one-tenth that of the United States.  This seems to be the direction that much of Europe is heading in, but it is not too late for the United States to diverge from its path of moving toward a system similar to the failing socialistic states of Europe…

As he points out, the reason that these made up rights never actually end up producing cheap, high-quality healthcare is that for this to happen two economic principles are necessary that socialized medicine completely ignores. These two principles are the profit motive and allowance of free labor because of these two principles many things have gone from being a luxury for just the rich to a commodity for the vast majority of people. This has happened with cars, TVs, computers, phones, light bulbs, refrigerators, air conditioning, and so many other things that even some of the poorest people in the United States own. The free market has worked like magic in so many industries, and there is absolutely no reason for this not to be the case in a privatized system of healthcare.

This does not mean a half private half public system like the one the United States has. Which causes premiums to more than double in only four years (HHS) or mostly publicized partially privatized system like Canada where women have to wait eight months for an MRI. Rather this means a deregulated unsubsidized system similar to the technology sector where Americans see enormous amounts of innovation to the point where major companies release a new phone every single year.

Even in small deregulated fields in healthcare such as Lasik eye surgery where just like what is supposed to happen in a free market the quality is getting better while the procedure is getting cheaper (Rosario). As stated above this transition does not need to happen all at once it can start off with the Obamacare replacement act followed by continued deregulation of the health care industry leading up to a gradual repeal of Medicare and Medicaid.  


Right now the healthcare in the United States is on a treacherous course, and it seems as if it is heading towards one of two ends of a spectrum. One end is a radical socialized medicine program while the other end is a free market patient-centered approach. The former seems to represent the path that the United States should be heading on. This method demands more than just ideas though; action is required to move in the direction of capitalistic individualism in the healthcare system. These actions should include but not be limited to participating in town halls with congressman and senators, along with calling their offices to let them know that if they do not promote the cause of liberty with regards to health care, that they will lose their seats.  


Aaron, Henry J. “The Impossible (Pipe) Dream-Single-Payer Health Reform.” Brookings, Brookings, 28 July 2016, Accessed 16 May 2017.  

Baicker, Katherine, et al. “The Oregon Experiment â Effects of Medicaid on Clinical Outcomes.” New England Journal of Medicine, vol. 368, no. 18, Feb. 2013, pp. 1713–1722. Google Scholar, doi:10.1056/nejmsa1212321. Accessed 16 May 2017. 

Paul, Rand. “The Obamacare Replacement Act (S. 222).” Paul.Sentate.Gov, Rand Paul, 25 Jan. 2017, Accessed 16 May 2017.  

Rosario, Katherine. “Obamacare Regulations Stifle Innovative LASIK Eye Surgeon.” Heritage Action for America, Heritage Foundation, 25 Nov. 2013, Accessed 16 May 2017.  

SADE, ROBERT M. “Foundational Ethics of the Health Care System: The Moral and Practical Superiority of Free Market Reforms.” Journal of Medicine & Philosophy, vol. 33, no. 5, Oct. 2008, pp. 461-497. EBSCOhost, doi:10.1093/jmp/jhn023.\. Accessed 16 May 2017.  


Shapiro, Ben. “Health Care Is a Commodity, Not a Right.” National Review, National Review, 11 Jan. 2017, Accessed 16 May 2017.   

Tanner, Michael. “Hard Truths about Health Care.” National Review, National Review, 5 Apr. 2017, Accessed 16 May 2017.  

United States, Office of The Assistant Secretary for Planning and Evaluation. “”, U.S. Department of Health & Human Services, 23 May 2017. Accessed 11 June 2017.

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