Five systems, five sets of rules, zero coherence — and each one works against the others
America isn't choosing between capitalism and socialism in healthcare. It's running both simultaneously — plus three other models — and capturing the worst features of all of them. Each system has different reimbursement rates, different administrative requirements, different eligibility rules. Providers have to navigate all five at once, which is why the overhead is staggering.
Employer-Sponsored Insurance
Medicare
Medicaid
The VA System
ACA Exchanges + Uninsured
Most expensive in the world. Mediocre outcomes. This isn't a close call.
Americans pay more per capita for healthcare than citizens of any other developed nation — and get shorter lives in return. The gap isn't small. We spend roughly double what comparable countries spend, and we rank below most of them on life expectancy, infant mortality, and chronic disease management.
Nobody in the system is rewarded for making healthcare cheaper or better
This is the part neither side talks about. The current system doesn't just fail to reduce costs — it structurally guarantees that costs will rise every year. Every major player benefits from the status quo.
The Built-In Cost Escalator
Insurance companies are required to spend 80–85% of premiums on care (the medical loss ratio). Their profit is a percentage of total spending. The only way to increase absolute profit is to let the total pie grow. They have zero incentive to reduce costs.
Hospitals negotiate rates as a percentage of Medicare reimbursement. Higher base rates mean higher negotiated rates. They benefit from price inflation.
Pharma companies have faced limited price negotiation for most of the market. The government has historically been prohibited from negotiating drug prices — the only buyer in the world that doesn't haggle.
Medicare reimbursement rates effectively set a price floor that goes up annually. It's a government-guaranteed cost escalator with zero connection to quality improvement or health outcomes.
What if we ran healthcare the way we run financial markets?
The federal government doesn't run the stock exchange. It doesn't execute trades or set prices. It sets rules for transparency, fairness, and accountability — and then enforces them with real consequences. The result is the most trusted and liquid capital market on earth. Now imagine that model applied to healthcare.
How the SEC Works
Apply to Healthcare
The problem isn't that we need more government or less government in healthcare. It's that we need government at the right level. Federal standards. State execution. The same pattern that built the interstate highway system, the most trusted financial markets in the world, and the internet itself.
Your state is bigger than most countries that run successful healthcare systems
The argument that states can't handle healthcare ignores a basic fact: American states are as populous and more prosperous than many nations that run excellent systems. Trying to create a single healthcare system shared between California and Alabama — states with fundamentally different populations, costs, and cultures — is the Frankenstein approach that got us here.
Every one of these states has its own tax collection infrastructure, its own regulatory apparatus, and its own democratic accountability to voters who can see the results. They are not helpless subdivisions that need Washington to design their healthcare. They're economic powerhouses that could build world-class systems — if Washington set the standards and got out of the way.
"You're already paying for socialized medicine. You're just getting the worst possible version of it."
The Bottom Line
America doesn't need to choose between free-market and single-payer healthcare. It needs to stop running five incompatible systems simultaneously and pretending that's a plan. The federal government should do what it does well — set standards, enforce transparency, penalize bad actors — and let states build the actual systems. We already have a model for this. It's called the SEC, the highway system, and the internet. The pattern works. We just haven't applied it to the thing that's bankrupting us.