For decades, the cost of the healthcare system in the United States has been increasing while also becoming more complex. Some observers believe that it is time for a thorough reform.
The current healthcare system in the United States is composed of public and private insurance companies, for-profit and non-profit healthcare providers, pharmaceutical manufacturers, welfare management organizations, retailers, and massive healthcare groups.
In 2023, the total healthcare expenditure in the United States was $4.9 trillion, surpassing any other country in the world. However, the health condition of Americans is not as good as that of people in other similar countries, and the life expectancy of Americans is also shorter than that of citizens in those countries.
An article titled “Bold leadership is needed for transforming health care” published by the National Institutes of Health (NIH) on June 17, 2019, pointed out that in the fragmented healthcare system, the old business model of charging for services is no longer viable. Bold reforms are needed, according to the NIH.
Some analysts and lawmakers have also expressed similar thoughts and have proposed several ideas to fundamentally change the way the country provides and pays for healthcare services.
Here are four of the most bold ideas:
The first idea aims to allow insurance beneficiaries to control their Medicare expenses, thus reducing the cost of federal Medicare.
Different from the current single-payer system, proponents have suggested an almost opposite approach, allowing states to opt-out of the federal Medicare program and refund the funds initially used to purchase Medicare to seniors within the state.
“Some states do not purchase certain federal plans while others do not at all, which may seem odd. However, this is not unconstitutional or legally problematic,” wrote Jason Sorens, a senior researcher at the American Institute for Economic Research (AIER), based in Massachusetts.
Sorens believes that state legislatures are more flexible than Congress and have greater financial responsibility, allowing them to design suitable solutions that give Medicare beneficiaries the right to choose their healthcare services.
“Elderly individuals can purchase health insurance and services in an open competitive market rather than being priced by the government or having providers pay the costs. This approach can lower healthcare costs, make people healthier, and significantly reduce fraud,” wrote lawyer Christopher Crennen in a column for the Epoch Times titled “Let Seniors Spend Their Medicare Money” on August 4, 2025.
Crennen estimated that each Medicare beneficiary would receive $1,350 per month, suggesting that a married couple could receive over $32,000 in funds annually. He stated that this money could be used to purchase catastrophic health insurance and save on daily medical expenses.
Though a concrete implementation plan for this idea has not been proposed yet, both Republican and Democratic lawmakers have expressed strong opposition to significant reforms to the federal Medicare program.
Indeed, the second idea aims to reduce healthcare costs by increasing consumer choices.
Health Savings Accounts (HSA) allow consumers to set aside tax-free funds specifically for eligible medical expenses. However, HSAs currently only apply to individuals enrolled in high deductible health insurance plans and cannot be used to pay health insurance premiums.
Federal Representative Chip Roy, from Texas, urged for the expansion of the use of HSAs to enable people to have more freedom in selecting healthcare services.
“The concept of healthcare freedom is actually a simple one: American patients and doctors must have the right to make autonomous decisions when choosing and providing healthcare, instead of leaving it to insurance companies and corporate/government bureaucrats,” Roy wrote.
Roy proposed “The Case for Healthcare Freedom: A System for a Healthier America” plan, which aims to expand the availability of tax-advantaged HSAs, allowing consumers to purchase healthcare services and health risk management tools, such as traditional insurance business or joining organizations that share healthcare costs.
The plan also aims to limit the excessive consolidation of large chain hospitals and restrict mergers between insurance companies, doctor’s offices, and pharmacy benefit management organizations to increase market competition and lower prices.
Critics of the HSA plan lean more towards government-led solutions for lowering prices and increasing competition.
The Center for American Progress (CAP), a progressive policy institution based in Washington, argued in an analysis report titled “Recent Health Savings Account (HSA) Expansion Proposals Are Costly and Misguided” published on December 13, 2023, that “Congress should not expand the tax-sheltered savings of high-income Americans but should pursue active reforms to lower healthcare prices and prescription drug costs so that employers can better afford to provide high-quality, comprehensive insurance products to employees.”
Furthermore, the third idea aims to reduce costs by changing the compensation model for healthcare providers.
The traditional healthcare system in the United States operates on a fee-for-service model. For example, for a single surgical procedure, the hospital, surgeon, radiologist, anesthesiologist, pharmacy, and physical therapist all charge separately.
In a value-based healthcare model, the medical insurance provider pays only one institution and ensures that patients receive all necessary services related to that surgical procedure.
According to a report titled “MCG Value-Based Healthcare Competition” from the Medical College of Georgia (MCG), “the compensation of healthcare providers should be based on their effectiveness in treating patients, reducing the impact and incidence of chronic diseases, and helping patients lead healthier lives.”
The value-based healthcare model aims to operate all healthcare providers as a team to lower costs and improve treatment outcomes.
Currently, the value-based healthcare services have not been widely implemented, but several insurance companies have made attempts in this direction. These companies include Kaiser Permanente’s Coordinated Care Plan, UnitedHealthcare’s Bundles of Care program, and Blue Cross of California’s Episode of Care model.
The Centers for Medicare and Medicaid Innovation terminated two value-based healthcare experiment programs, the Primary Care First Model and the Making Care Primary Model in March this year.
A study on 618 hospitals implementing value-based incentive programs concluded that for hospitals providing medical services to Medicaid patients and those without health insurance, implementing these programs was economically penalizing and did not bring measurable benefits at a population level.
The fourth idea aims to lower healthcare costs by improving the overall health of the American population.
Dr. Rishi Manchanda, a physician and health educator, stated in a widely circulated video talk in 2014, “What we need is a healthcare system that not only focuses on a patient’s symptoms when they come to the clinic but truly improves the health of patients from the root.”
Health and Human Services Secretary Robert F. Kennedy Jr. introduced how this idea could work at the government level.
Secretary Kennedy stated in a release on April 10, “We will … merge several offices of the Health and Public Services Department in a new ‘Healthy America’ administration dedicated to preventing diseases and combating chronic diseases.”
Ultimately, the success of Secretary Kennedy’s approach depends on whether the federal government can take action to eradicate the improper incentives that lead to patient, insurance company, food supplier, and pharmaceutical company’s disparate actions.
It also depends on cultural factors: changing Americans’ thinking and behavior towards health.
The progressive think tank, the Center for American Progress, argued that Secretary Kennedy’s approach deviates from proven strategies for effectively preventing diseases.
The Make America Healthy Again Commission released a report on September 9 outlining this strategy.
The plan calls for a wide range of nutrition-related actions, including revising food guidelines issued by the Department of Agriculture. Many hospitals and institutions in the United States, along with many consumers, utilize these guidelines to develop meal plans.
Other measures include limiting or banning the use of petroleum-based food dyes, especially in foods delivered to schools, implementing a definition of ultra-processed foods across all government agencies, and seeking guidelines to restrict direct marketing of unhealthy foods to children.
The plan also includes targeted research on air and water quality, microplastics, vaccine injuries, and potential impacts of over-prescribing certain medications to children.
Further initiatives of the plan aim to increase public awareness of the health risks of excessive screen time, electronic cigarettes, and pesticides, and restrict direct-to-consumer advertising of prescription drugs.
Over the past 60 years, the U.S. healthcare system has undergone several major reforms, including the establishment of Medicare and Medicaid in 1965, the expansion of Medicaid in 1977, the enactment of the Emergency Medical Treatment and Active Labor Act and the Consolidated Omnibus Budget Reconciliation Act in 1986, the Health Insurance Portability and Accountability Act in 1996, the creation of Health Savings Accounts in 2003, the Mental Health Parity Act in 2008, and the Affordable Care Act in 2010.