Do insurance companies undermine the benefits that a free market should have in our healthcare system?

brainstorming for a research paper. any constructive input would be appreciated.





For capitalism to have any benifit in increasing efficiency, there has to be competition right? that way the consumer can pick the product (in this case lets say a certain medical procedure or piece of equipment) that gives them the best VALUE for their buck. this should, in theory, force competition. do i have this right so far?





with the current health care paradigm, for the most part, employer paid or government subsidized insurance companies ( HMOs, Medicare, etc) pay the bills of the consumers directly, and then pass along the expenses to ALL of their customers accordingly in the premium.





If people are not paying directly for a good or service, they are not likely to care about its actual value, right?





My premise is that with this type of payment system, capitalism cannot do with healthcare what it has done with every other industry, because people dont have to make wise decisions.





any solutions?

Do insurance companies undermine the benefits that a free market should have in our healthcare system?
The problem is that there is no way a free market can really work with healthcare. The consumer does not have enough information to make decisions. If someone is sick they don't have time or ability to shop for opinions. They cannot decide to do without treatment.





If you look at anything on the economic theory of capitalism, you would see that these things preclude a free market from working.