It seems like a strange omission for this article not to mention that the reason health insurance is so expensive in the US is that health expenditures are so high. The US spends more than $10,000 per year per person on health care[1], more than any other country. Clearly, on average, premiums clearly must be higher than the amount paid out on behalf of the customer.
If you want lower premiums, you somehow need to lower the amount spent on health care. The problem is that, perversely, health insurance companies are incentivized to spend more on health care rather than less. By law, they must spend at least 80% of the money collected as premiums on health care costs[2]. The more they pay, the larger the 20% they are allowed to keep.
So if you want to reduce the cost of health insurance in the US, you need to reduce the cost of health care. If you want to reduce the cost of health care, you somehow need to change the incentives so that the big players benefit when the cost of health care goes down rather than up. Failing that, you need to change the system so those big players are no longer in control.
Only the latter option is a feasible solution. If you look at countries with mixed systems (like South Africa), a great deal of the cost savings disappear. Tim Faust has a great new book that breaks this down. Also, recommend his interview on the Death Panel podcast.
If you want lower premiums, you somehow need to lower the amount spent on health care. The problem is that, perversely, health insurance companies are incentivized to spend more on health care rather than less. By law, they must spend at least 80% of the money collected as premiums on health care costs[2]. The more they pay, the larger the 20% they are allowed to keep.
So if you want to reduce the cost of health insurance in the US, you need to reduce the cost of health care. If you want to reduce the cost of health care, you somehow need to change the incentives so that the big players benefit when the cost of health care goes down rather than up. Failing that, you need to change the system so those big players are no longer in control.
[1] https://www.healthsystemtracker.org/chart-collection/health-...
[2] https://www.healthcare.gov/health-care-law-protections/rate-...