As a follow-up to this post, I wanted to take on the argument that people use against the US's health care system, arguing that it must be worse than other countries socialized approach because it costs so much more. Well, I am the first to agree that reduced regulation and a better matching of who is paying the cash to who is receiving the services would result in huge cost savings. However, it may also be true that you get what you pay for, as discussed in Cafe Hayek. The key chart is shown below:
One thing I forgot to mention in the previous post was a bit of background of exactly why we have a model where health care is payed for by the employer. This structure of company-paid health care was not a natural market evolution, but was in fact a direct result of several very distorting government regulations.
Company funded health care plans began in the 1930's and 1940's as a way for companies to try to get around government controls and freezes on wage rates, first instituted with the NRA and later during WWII. In particular, during the incredibly tight domestic labor markets in WWII, employers struggled with government-mandated wage controls, and used the promise of employer-paid health care as a way to provide higher effective compensation to attract employees, since these non-cash benefits were not counted in the wage freeze calculation. After the war, the government locked in this practice when the IRS and Congress agreed that company-paid health care was not taxable as regular income, meaning that such health plans were given a strong tax-preference over cash wages.
Finally, if you are not familiar with the appalling experiment in fascism that was the NRA, I wrote about it here.