I think a free market insurance system would basically end up paying out lump sums for various illnesses and conditions. Hospitals would publish average price lists and then insurers would advertise and pay based on that.
Get lung cancer? Here take $200k courtesy of your insurance. Only going to cost you $150k? "No problem, glad you found a cheaper place. Buy a nice gift for your wife with the difference"
Pretty good insurance company to be able to offer a smaller premium when they have to cover the exact same costs on average when they have 10x the overheads of a company that pays lump sums.
Not to mention you are by necessity limited by the hospital and doctors on the insurance companies approved docs list. No thanks; they don't have my interests at heart.
Not to mention the very real incentive for such an insurance company to stop paying for "problem" clients with long ongoing illnesses.
If 25% of lung cancer cases cost less than $150,000 to treat, 50% cost less than $200,000 to treat, 75% cost less than $250,000 to treat, 99% cost less than $500,000 to treat and 99.999% cost less than $2,000,000 to treat, how much would the insurance company pay out for lung cancer?
There is no set cost for complex chronic diseases like cancer, so there is no way that could be published. No single case of cancer is exactly the same, and the course of it and how it responds to various treatments varies widely.
Sure it could. They would just have to categorize the major varieties etc. if you mean it wouldnt be 100% accurate well of course not as it is rough aggregate data. But it is very useful aggregate data.
Get lung cancer? Here take $200k courtesy of your insurance. Only going to cost you $150k? "No problem, glad you found a cheaper place. Buy a nice gift for your wife with the difference"