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Enthoven
Why Competition in Health Care Has Failed: What Would it Take to Make it Work?
by Alain C. Enthoven, Clemens Lecture Series 6, 1992
Introduction
National Health Expenditures per capita, adjusted for general inflation, grew about 4.5 percent per year from 1980 to 1990. Total expenditures grew from about 9.1 percent to 12.3 percent of the GNP. These rates of growth and spending are widely considered to be unsustainable and excessive. In the same years, we heard a great deal of official rhetoric about the superiorty of "competition" and free markets over "regulation," and we saw the proliferation and rapid expansion of Health Maintenace Organizations (HMOs) and Preferred Provider Insurance (PPI). However, one wants to characterize the public policies and private employer cost containment strategies of the 1980s, they clearly failed to bring health expenditure growth rates down to acceptable levels.
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