Toward a value-based model of healthcare

We've spent the last decade seriously debating healthcare reform in this country. But somehow, even after a decade of debate, we are still treating the symptoms and not the disease, like a doctor treating lung cancer as a bad cough.

Beneath all the chatter about insurance markets, premiums, coverage, and copays is a simple truth: extending the line that separates life and death is a costly venture. The main reason why we spend so much on health insurance is that healthcare costs so much.

The supply and demand curves of care are out of whack. In 2016, according to the Cato Institute, health expenditures topped $10,000 per individual. The average family healthcare plan costs over $18,000 per year. In fact, over 18 percent of the entire national economy is comprised of the health care sector.

Congress' approach to healthcare reform has predominantly focused on how many individuals we can cover and how to make premiums more affordable. And to be sure, we need to get the health insurance market right. I supported the American Health Care Act, which I believe is the first step in making our insurance market more affordable and ensuring that more Americans have access to care. But policy makers need to dive deeper than just coverage numbers and premium costs, finding ways to actually drive down the cost of care.

Government can't easily address the demand side of healthcare.