> As soon as we start talking about premiums we adopt business language and metrics and abandon medical language and metrics.
To provide healthcare you need doctors, who need money to pay rent and student loans. You need an office to put the doctors in. You need drugs and medical devices, and researchers to come up with them. You need lawyers to keep the doctors from conducting the Tuskegee Experiment. And nurses and lab techs and janitors etc.
That is all business stuff. Paying employees and managing offices etc. If you don't pay the employees enough then they get another job and quality of care suffers. If you pay them too much then costs get out of hand.
The way you determine how much is the right amount is by letting people choose how much to pay for it. If you have a runny nose and the doctor wants ten million dollars to see you for five minutes, you blow them off as unreasonable and get a different doctor. If you demand to see them for $10 and that isn't enough to cover their costs, they blow you off as unreasonable and get a different patient. Somewhere in the middle there is a price above what it costs and below what it's worth where you neither die of a sinus infection nor sell your first born to have it cured.
There are a lot of reasons this works poorly in the US. Low deductible employer-provided health plans making consumers price insensitive, lack of price transparency, an excessively burdensome FDA approval process that impairs competition between pharma companies, etc. But those are specific failings that could be addressed.
Switching to central planning just adds a new problem without solving the existing ones. If consumers pay nothing, not even actual cost, there is even less incentive to forego unnecessary procedures. Setting prices by committee is a sure way to either overpay (and waste money) or underpay (and get supply shortages). If drug companies still set prices then costs remain high, but if they can't charge the prices they do and still have to go through the same very expensive approval process, you stop getting new drugs. And then you add another trillion tax dollars to the budget which every campaign donor in the country will have a chance to divert a chunk of away from actual medicine and into their own pockets.
> All that money is pocketed by businesses run for profit.
The significant majority of that money typically goes to employees, not shareholders. The costs are too high, but it's not because the average medical practice is turning a huge profit, it's because the existing regulatory environment causes providing medicine to be unnecessarily labor intensive (i.e. inefficient).