Can Insurance-Free Care Be a Solution to our Healthcare Spending Problems?


While driving along the boulevard, your fuel gauge ticks judiciously towards empty, partially obscuring the “E” as the orange light of death uncomfortably gleams out of the corner of your eye. You know it is time for a refill. As you pull into the gas station, a large white sign boasting various gas prices in size 4,000 font welcomes you. Across the street and one block north is a competing station with prices 3 cents cheaper per gallon. Without much else to offer, gas stations viciously compete on price in the hopes of swaying you to drive that extra block.

But what if car insurance worked like health insurance and covered all of your gas tank needs in exchange for a higher monthly car insurance rate? Because the customer would no longer be concerned with the cost of gas, each gas station would suddenly operate in a cloaked environment, devoid of necessary transparency and unaffected by the competitive forces normally applied by other gas stations; forces that, in an otherwise healthy market, would serve the indirect role of maintaining accountability and keeping prices low.

With this seemingly minor change, the car insurance company paying your bills replaces you as the gas station’s paying customer. Those large white signs advertising low prices would descend into futility, as consumer-driven competition would cease to exist.

Fortunately in medicine, some physicians have decided to opt out of the insurance-for-all-care model and test the limits of what’s possible in providing direct medical care for a reasonable price. At the Surgery Center of Oklahoma (link:, Dr. Keith Smith has brought a free-market libertarian approach to medicine, posting all surgical prices online and only accepting cash or credit. As you can see from their prices (link:, surgeries that are unimaginably expensive at an average hospital go for a few thousand dollars at the Surgery Center of Oklahoma. Which begs the question: If a surgeon can profitably offer his services for $5,000 at the Surgery Center of Oklahoma, what has broken down in the healthcare market that allows a local hospital to charge 6-10 times that (link: for the same surgery by the same surgeon?

Insurance coverage of all planned and routine care has diluted the patient-first philosophy with a system that discourages price transparency and eliminates the consumer from the medical decision making process. Until we embrace the innovative capacities all physicians such as Dr. Smith can offer, the future of healthcare spending is a grim one.


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Larry Istrail is a medical student and entrepreneur that is passionate about the intersection between medicine, technology, and innovation. He is the co-founder of PhotoCalorie, a photographic food journal that allows you, your friends or your physician to literally see what you’ve been eating. He is also the founder of the Ancestral Weight Loss Registry, a crowdsourced weight loss research service with data from over 50 countries around the world. You can follow him on tumblr.