Competition in health care industry can help reduce costs

"Choice and competition work in health care," but "most of us aren't lucky enough to have access to a market shaped by them," Robert Moffit, director of the Center for Health Policy Studies at the Heritage Foundation, writes in a Washington Times opinion piece.

For example, under the "consumer-driven" Federal Employees Health Benefits Program, members can select from 284 private health plans nationwide, and their premiums on average will increase by only 1.8% this year, Moffit writes.

In addition, under the Medicare prescription drug benefit, beneficiaries can select from a number of private health plans to provide coverage, and "intense competition among plans" has reduced medication costs for beneficiaries, he writes.

However, most U.S. residents "have never been near a competitive health care system" because employers in most cases offer few health plans or only one plan, according to Moffit.

In response, he writes, some lawmakers have "come up with innovative ideas to introduce competition into the health care system."

Sens. Mel Martinez (R-Fla.) and Tom Coburn (R-Okla.) have introduced the Tax Equity and Affordability Act, which would provide tax credits to help individuals and families purchase health insurance, Moffit writes, adding that the tax credits "would enable them to buy the health plans of their choice."

In addition, Sen. Jim DeMint (R-S.C.) and Rep. John Shadegg (R-Ariz.) have introduced the Health Care Choice Act, which would allow U.S. residents to purchase health insurance in any state, regardless of their place of residence, to establish a "national market," Moffit writes.

"Again, today, only federal workers and retirees have anything like a national market for health insurance," he writes, adding, "After the November elections, perhaps Congress will get serious and put the common good of millions of Americans over the special interest of a few who fear a genuine free market in health care" (Moffit, Washington Times, 10/19).