When it comes to government control of health spending, the United States is closer to communist Cuba (89%) than the average OECD nation (75%).

From U.S. Health Care: The Free-market Myth by Michael F. Cannon.

Many critiques of U.S. health care begin with the assumption that, as The Economist put it, the United States is "one of the only developed countries where health care is mostly left to the free market." Dr. David Blumenthal, a former advisor to President Barack Obama, told the New York Times in 2013 that in the United States, "we like to consider health care a free market." That assumption gets the situation backward: In truth, among wealthy nations, the United States may have one of the least-free health-care markets.

In a free market, government would control 0% of health spending. Yet the Organization for Economic Cooperation and Development (OECD) reports that in the United States, government controls 84% of health spending. In fact, government controls a larger share of health spending in the United States than in 27 out of 38 OECD-member nations, including the United Kingdom (83%) and Canada (73%), each of which has an explicitly socialized health-care system. When it comes to government control of health spending, the United States is closer to communist Cuba (89%) than the average OECD nation (75%).

Nor does the United States have market prices for health care. Direct government price-setting, price floors, and price ceilings determine prices for more than half of U.S. health spending, including virtually all health-insurance premiums. Moreover, government pushes all medical prices and health-insurance premiums upward through tax laws and regulations mandating that people purchase excessive levels of health insurance. The extra coverage reduces patients' price sensitivity (i.e., their willingness to shop around for lower prices), which allows providers to charge higher prices. The myth that the U.S. health sector has "largely unregulated prices," as the Los Angeles Times reported, is as stubborn as it is outrageous.

That myth goes hand-in-hand with another: that government price-setting always pushes prices below market levels. If U.S. medical prices are excessive, this myth implies, those prices must be market prices. Government intervention can indeed lead to below-market prices, which create shortages and reduce quality — the U.S. government sets price ceilings of zero dollars on transplantable organs, for example. More often, however, federal and state governments push health-care prices higher than they would be in a free market. U.S. health-care prices are excessive because government controls them.