John Goodman makes the case here (via Don Boudreaux at Cafe Hayek).
Goodman opens with a story about how a person faced with spending $2,800 of her own HSA money on a CT-scan, called around and got one for $400.
He then explains one major problem in our health care system:
For the most part, no one ever sees a real price for health care services – not doctors, not patients, not employers, not employees.
The reason patients never see the prices is because third-party payers (insurance companies, employers and government) negotiate with providers – leaving patients with a small co-pay under traditional insurance. Because no one sees what services cost, individuals have every incentive to over-consume and caregivers to over-provide, resulting in waste of precious health care resources. And without real prices, there is no basis for third-party payers or anyone to negotiate the lowest possible prices.