Policy Documents

How to Cure Health Care

Milton Friedman –
August 20, 2001

In this pamphlet, renowned scholar Milton Friedman asserts that the United States spends a mind-boggling percentage of its GDP on a health care system that virtually everyone agrees is a disaster. 

Friedman concludes that,

A more radical reform would, first, end both Medicare and Medicaid, at least for new entrants, and replace them by providing every family in the United States with catastrophic insurance (i.e., a major medical policy with a high deductible). Second, it would end tax exemption of employer-provided medical care. And, third, it would remove the restrictive regulations that are now imposed on medical insurance-hard to justify with universal catastrophic insurance.

This reform would solve the problem of the currently medically uninsured, eliminate most of the bureaucratic structure, free medical practitioners from an increasingly heavy burden of paperwork and regulation, and lead many’ employers and employees to convert employer-provided medical care into a higher cash wage. The taxpayer would save money because total government costs would plummet.