Let's merge competitive and regulatory strategies to achieve cost containment

Whether market-driven or government-driven approaches should be used to curtail future health care expenditures has become the debate of the decade on Capitol Hill and in state legislatures. After examining both the competitive and the regulatory models to constrain health care costs, it is argued that to achieve an effective and efficient health care system, a properly structured market-driven approach should be blended with a minimal number of safety and soundness regulations. To successfully implement such a half-competitive, half-regulatory system in the United States, it will be necessary, for example, to empower thirdparty payers and providers to negotiate prices without direct government involvement; to modify enormous regional differences in use rates and health care costs for various treatments with more rigid treatment protocols that are promulgated by the managed care plans; to minimize administrative-type expenditures that have no visible, beneficial effect in improving quality patient care; and to curtail the supply of underutilized health care resources as another means to constrain health care expenditures. These strategies would have significant political, social, economic, and patient care implications for the United States but might result in our health care cost dilemma appearing to the public as finally being "under control."