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September 11, 1996

The Health Care MarketTheory and Reality

Author Affiliations

From The Eisenhower Center for the Conservation of Human Resources, Columbia University in the City of New York (NY).

JAMA. 1996;276(10):777-778. doi:10.1001/jama.1996.03540100021011

The preeminent view among the American public, its elected federal and state officials, and the health policy community is that competition and the market will accomplish many of the critical reforms proposed by President Clinton, in particular moderating costs and improving quality, even if this approach falls short of providing universal health insurance coverage. Further, that the American public will be much better off for avoiding added microincursions of government into the management of its health care system with consumers, rather than bureaucrats, determining future decisions. How well do these assumptions about the superiority of the market to allocate revenues in health care and expand consumer choice square with the trends of the past 3 decades, the situation today, and the likely developments tomorrow?

A Backward Look  To preview my conclusions: almost everything that has happened since the passage of Medicare and Medicaid in 1965 has indicated a pronounced shift