Think about what would happen to the cost of food if you had an insurance policy that paid for your groceries. You wouldn't care what things cost. Why buy hamburger? Just buy filet mignon. Why look for sales? Why shop at the store across the street? If the insurance company's paying, who cares?
I asked Whole Foods founder John Mackey what would happen if his customers bought groceries the same way most of them buy health care. "We'd make a lot more money. Instead of buying a bottle of wine for $7.99, they might buy a $300 bottle of wine."
Yet this is how we pay for health care? "I know, it's ridiculous."
Mackey knows that when people shop around, costs go down. So seven years ago, faced with skyrocketing health insurance costs, Whole Foods decided to offer its employees high-deductible insurance -- the kind Mark Horn has. If workers get cancer or heart disease, insurance pays, but for things like physicals and flu shots, employees pay. Whole Foods even helps employees meet those costs by contributing to a special "health savings account." Because the savings accounts belong to the employees, they shop around before spending the money.
And what happened to the company's bottom line after implementing the new insurance plan? "Our costs went way down," Mackey says, because "people started asking what things cost."
Whole Foods employees liked the system so much, they voted overwhelmingly to keep it.
When Whole Foods marketing director Mary Ann Buttros went to the doctor, she never used to ask, "'How much will this cost?' Because it didn't matter," she says. "And now it matters to me because it's my money."
The Whole Foods experiment works because it makes people care about costs. But because most Americans with health insurance expect someone else to pay, shopping around is harder than it should be.
I told insurance industry spokesman Michael Tuffin about how hard it is for people like Mark Horn to shop around for the best price. "Mark can't even find out what things cost," I said. "Right, that's a big part of the problem. There's no question there needs to be some personal responsibility," Tuffin said.
But when insurance is involved, there's less personal responsibility, and that makes costs go up. That's something to think about the next time you hear a politician say they will make your health care cheaper by making insurance pay more.