Healthcare Reform: Returning Power to Patients
In 1835, Alexis de Tocqueville warned that democratic governments, despite their good intentions could stray to despotism with a gradual removal of individual choice, agency, and accountability from the lives of free people. He warned that it would not be outright tyranny, but systems that manage outcomes on the behalf of the people the system is supposed to serve. Nearly two hundred years later, healthcare patients in the US do not know the price of their care before receiving it, disconnecting price and the quality of service where patients cannot compare providers and navigate the complex billing system. Tocqueville would realize that this issue is not merely a healthcare crisis but a civic issue disconnecting the consumer from the service that they are paying for.
As examined in our previous healthcare article, Priced Out? American Healthcare and the Cost Structure, the system does not lack innovation or resources, but the structure that serves the people inside it. The consumer has been removed from the transaction, and in being removed from the transaction, the citizen has been removed from the accountability that makes free societies and economies function. These are the same problem, and reform must be a civic restoration.
The work of Joe Lonsdale and the Cicero Institute has been foundational for my personal knowledge in shaping a reform agenda. Their approach focuses on pragmatic, state-level, free-market reform not requiring a choice between government and markets. But developing incentive structures that align the interests of providers, patients, and government on the same outcome: high-quality, affordable, and accessible healthcare.
The structure of American healthcare did not fail overnight; it has evolved through decades of federal policy layered with good intentions. Medicaid and Medicare expanded access for millions of Americans, and the ACA act reduced the number of uninsured Americans. Each reform has tried to address real problems, but each has added additional administrative layers, expanded third-party dominance and system complexity. Most importantly, each removed the individual from the decisions that instrumentally affect their own healthcare and finances.
The burden of these issue falls heaviest on lower- and middle-income Americans, who do not qualify for full government support but cannot also absorb rising costs. Delayed care, growing debt, and worse outcomes are the result of this structural issue. Reform must start by understanding the mission of putting the patient first, and these reforms will make that possible.
Federal law has required hospitals to publish clear and accessible pricing since 2021, but compliance and enforcement has been weak. The Cicero Institute has documented that price variation for identical procedures within the same market can be dramatic because price negotiation allows it. Enforcing transparency through existing federal law is the foundation of reform because a functional market cannot exist without price visibility. People must be able to make free choices with information on pricing and withholding that information is not functional. Government’s role is not to control price, but to be the referee enforcing conditions where a real market can function.
On the other hand, the patient must have the most agency to make a decision that fits their situation and the service they would like to pay for. Expanding HSAs to be universal allows individuals to accumulate tax-advantaged funds for any health expense on their own judgement. Income-adjusted vouchers, private HSAs paid for by employers, and reforming the ESHI exclusion would allow individuals to purchase coverage or pay for care directly to preserve access in the relationship between patient and provider. Allowing catastrophic-only coverage options for healthy, young individuals would reduce premiums and widen access for those who cannot afford comprehensive, ACA-compliant plans they do not need or can afford.
The principle among these two-pronged reforms is that when individuals have a direct relationship with the cost of their care, they focus on quality, options, and hold providers accountable to high-quality service.
Tocqueville’s warning was not that government could not help people, but that a system that manages everything gradually teaches them to trust the state and not their own agency. The American healthcare system has been drifting in that direction, and these reforms, enforcing price transparency and restoring demand-side agency reverse the trend. By returning the patient to the transaction, unleashing private innovation, and ending cartel-like price negotiations, the citizen who is also the consumer makes the decisions that shape their own life. What is required now is the civic courage to redesign a system around the people it was built to serve.
“Despotism often presents itself as the repairer of all the ills suffered, the support of just rights, defender of the oppressed, and founder of order.” -Alexis de Tocqueville
https://ciceroinstitute.org/blog/how-to-reform-american-healthcare/
https://ciceroinstitute.org/issues/healthcare/
Alexis de Tocqueville, Democracy in America