lol, you're suggesting it would work better under out of pocket then?The upward spiral of costs can be attributed to the vast majority of medical bills being paid by a third party.
Under this system, the consumer doesnt really care how much something costs, and so those that provide the service are free to charge what they want -- the only limit to the cost is what the third parties are willing to pay, and since their resources are skewed by the number of healthy people paying into the system, they can pay a LOT more than they otherwise would, and still turn a profit.
You're assuming a pure system without copays, which isn't an inevitable feature of 3rd party pay. It is possible to put incentives for or against behaviors that demonstrate they are effective and cost-effective on both the patient and provider level. If you want to encourage doctors to do something, you make those things fee for service. If you want to cause doctors to refer less, you use capitation.
Due to the unpredictable nature of healthcare, insurance is necessary. One thing I agree with the agent on is if we get rid of 3rd party pay, we will be worse off. Where we differ is he believes the private sector is the better vehicle for this.Thus, any system that does not get rid of third-party payment does nothing to tackle the high cost of health care.
And, in any case, you having a right does not equate to you having the right to have the means necessary to exercise that right provided to you by someone else.
Normal people do want the newest (that they fallaciously believe is the best) of what's available when they do need to be cut into, regardless of cost, but that's why we should ration based upon what is effective and cost-effective. And the rationing need only refer to what the government will pay for. Private insurance won't play a huge role unless the government screws up somewhere, and they probably will but not to the extent the private sector has, so I wouldn't have a problem with 2-tier. Indeed, there are alternative and better systems to Canada and Britain that are much better than ours.