Introduction

The problems with America's patchwork health care system are fast reaching a critical mass. Soaring costs, rising faster than inflation, are eroding workers' coverage and paychecks. Sixteen percent of Americans have no coverage at all -- a problem that has become worse in the last five years. And medical studies reveal an alarming extent of poor-quality care that affects everyone.

A slew of perverse incentives and outdated practices undermine the promise of modern medicine. Insurance companies pay doctors and hospitals the same fees regardless of clinical success or failure. The government subsidizes coverage for highly paid business executives more generously than for rank-and-file workers. Courts rule on malpractice lawsuits without giving doctors guidance about how to avoid medical mistakes. Doctors use paper records that cannot be automatically checked for mistakes, duplication, and missing care. Patients receive treatments for avoidable ailments without anyone showing them how to take better care of themselves in the first place. Scientists regularly produce important new knowledge, but fellow scientists fail to incorporate it into research that delivers cures, and it often goes unused by doctors for years.

These problems are serious but not unsolvable. What is missing today is the political imagination and courage to move to a new vision of universal health care -- one in which government takes action in the public's interest, without seizing control of the system. Such a vision would reject the false choices offered in the stultified left-right debate between those who seek a government takeover of health care and those whose veneration of free markets would leave individuals to fend for themselves. Instead, it would equip Americans with the tools they need to build the world's best health care system from the ground up.

President George W. Bush has pinned his hopes on health savings accounts (HSAs): tax-free accounts for ordinary medical expenses like physical checkups and preventive care. They must be accompanied by high-deductible insurance policies for major medical emergencies. They are meant to restrain spending by having consumers themselves pay for the full cost of health care services out of their accounts. But HSAs are not the panacea for rising health care costs that conservatives claim. Although they would stop some patients from running to the doctor unnecessarily at someone else's expense, they would still re-quire insurance companies to pay the bulk of health care costs, since most health care spending is for emergencies and other high-cost care, not ordinary expenses. These accounts are also unfair to patients with chronic illnesses who have higher everyday expenses that will quickly exhaust their savings accounts.