We read Senator Tom Coburn's (R-OK) piece in the New York Sun yesterday. While we applaud Senator Coburn’s commitment to reforming our struggling health system and his bill, S. 1019—which contains many creative proposals, including efforts to improve and promote preventative services—we believe that with a few market reforms we can make markets work more efficiently and effectively for all Americans.

So in order to truly turbo-charge competition, we must take markets a few steps further:

• The insurance marketplace must be reformed so that markets work for all Americans (not just the healthy and wealthy). No more exorbitant rates based on pre-existing health conditions or denials for coverage.
• Subsidies are needed to make sure health insurance is affordable. Tax credits are a good option.
• Everyone should be required to have insurance—the so called “individual mandate.”

Bringing everyone into the insurance marketplace will make the risk pool healthier, reducing the incentive for insurers to charge higher rates in order to protect themselves against adverse selection. Insurers would be forced to compete based on price and quality, not marketing and underwriting. This type of competition harnesses the essence of market forces to increase transparency and value within the health system.

On a final note, we agree with both Senator Coburn and Senator McCain that health care cost growth is a serious economic challenge facing our nation. While Senator Coburn identifies the “demographic tsunami,” of retiring baby boomers, we would like to emphasize that CBO Director Peter Orszag has said repeatedly that it is health care cost growth, not the impending onslaught of baby boomers, which threatens Medicare’s solvency and the stability of the federal budget.

No health reform proposal will be sustainable over time without serious efforts to control health care spending. And because of cost-shifting due to uncompensated care for the uninsured, coverage rates are inextricably linked to the cost of care for the rest of us. We cannot solve the cost problem without covering the uninsured.