In Dire Health

Most people assume that insurance is an essential part of the health-care system. Some think it should be provided through public programs like Medicare, while others prefer to see it purchased from private insurance companies, but

the majority believe that insurance is needed to help pay the unpredictable and often catastrophic expenses of medical care. That is why so much public policy focuses on extending coverage to as many people as possible and controlling its cost. I think this emphasis on insurance is mistaken. We would have a much better and more affordable health-care system if the reimbursement of medical expenses through public or private insurance plans was replaced by tax-supported universal access to comprehensive care, without bills for specific services and without insurance plans to pay those bills...

There is...a practical alternative to health insurance and the fee-for-service system with which it is usually associated: a not-for-profit system in which a public single payer provides universal access to comprehensive private care delivered by primary-care physicians cooperating with medical specialists in group-practice arrangements. Like health systems based on insurance, this system would not require that patients have much “skin in the game” and therefore might pose a moral hazard that would lead to overuse of elective services. However, unlike insurance-based systems, physicians would be paid by salary rather than fee-for-service, so it would give physicians no financial incentive to recommend unnecessary procedures. Each group’s management would determine and pay salaries, under federal regulations that would cap the fraction of the group’s budget allocated to salaries but would allow management to determine individual compensation. Furthermore, in this insurance-free system, primary-care physicians trained to avoid unneeded care would counsel patients....

The recently reorganized Veterans Affairs medical-care system, once viewed unfavorably, now is often cited as another example of a single-payer system that provides comprehensive care by teams of salaried physicians and other health professionals, without insurance reimbursement. The federal government funds the program, but its patients contribute modest payment for some services...