The Transparent-Care Compact
A Framework for Restoring Freedom, Competition, and Clarity in American Healthcare
American healthcare does not suffer from a lack of spending, expertise, technology, or people trying to make it work. It suffers from a system in which the relationship between the person receiving care and the person providing it has become increasingly difficult to see.
Prices are obscured behind negotiated rates. Insurance is often confused with healthcare itself. Employers, insurers, hospital systems, regulators, pharmacy benefit managers, and government programs stand between patients and providers. Competition exists, but it operates inside a system shaped by licensing restrictions, regulatory barriers, tax incentives, network agreements, reimbursement structures, and decades of accumulated policy.
The Transparent-Care Compact begins with a different question:
What might American healthcare look like if patients and providers were given more freedom to deal directly with one another?
This Compact is not presented as a perfect solution or a final blueprint for American healthcare. It is an example of what becomes possible when we begin with transparency, voluntary exchange, competition, accountability, and constitutional limits rather than attempting to repair complexity by adding another layer of complexity.
The goal is not simply to make healthcare cheaper. It is to make healthcare understandable again.
The Idea
Imagine a healthcare system in which a patient can ask what something costs and receive an answer. A physician can publish a price without first determining what an insurance company will reimburse. A clinic in one state can compete for patients from another. An individual can purchase insurance across state lines. Employers can contribute toward healthcare without effectively controlling an employee’s insurance choices.
Insurance can return primarily to what insurance was historically designed to do: protect people against large and unpredictable financial risks. Routine healthcare, meanwhile, can increasingly become what most other professional services already are—a transparent exchange between the person providing the service and the person purchasing it.
None of these ideas require eliminating government, abandoning consumer protection, or pretending healthcare functions exactly like every other market. They require asking whether the rules governing healthcare should protect people from harm—or protect existing institutions from competition.
That distinction is the foundation of the Transparent-Care Compact.
Foundational Principles
1. Healthcare is a service. Insurance is a contract.
Healthcare and health insurance are related, but they are not the same thing. Healthcare is the provision of medical services. Insurance is a financial mechanism for managing risk.
Treating insurance as the primary gateway to ordinary healthcare has helped create a system in which patients frequently consume services without knowing their prices and providers frequently deliver services without knowing what they will ultimately be paid. The Compact seeks to restore the distinction.
Routine care should be capable of being purchased directly whenever patients and providers choose to do so. Insurance should remain available to protect against catastrophic and unpredictable costs.
2. Transparency should be the default.
Patients cannot meaningfully exercise choice when prices are hidden. Providers participating in transparent direct-pay markets should be free to publish clear prices for services, procedures, memberships, and packages without being penalized for offering those prices directly to consumers.
Transparency does not guarantee that every service will be inexpensive. It allows people to compare, and comparison is where competition begins.
3. Voluntary exchange should be protected.
Patients and providers should generally be free to contract directly with one another. A patient who wishes to pay a physician directly should be able to do so. A physician who wishes to operate a membership practice should be able to do so. An employer who wishes to provide employees with healthcare funds rather than selecting a single insurance arrangement should have that option.
The presumption should favor voluntary arrangements unless there is a clear and demonstrable reason to prohibit them.
4. Competition should cross state lines.
The United States is a national economy divided among fifty states with their own legitimate authority over health, safety, licensure, and consumer protection. Those powers need not require fifty isolated healthcare markets.
The federal government’s constitutional role in interstate commerce can be used narrowly: not to manage healthcare from Washington, but to prevent states or entrenched interests from unnecessarily blocking lawful interstate commerce. Americans routinely purchase goods and services from businesses located throughout the country. Healthcare and insurance should be capable of greater interstate competition as well.
5. States retain their constitutional role.
The Compact does not require a national healthcare bureaucracy. States retain authority over professional standards, medical licensure, facility safety, fraud, malpractice, and consumer protection under their traditional police powers and the constitutional structure of federalism.
Different states may choose different approaches. That variation is not necessarily a defect. It allows states to experiment, compare results, and learn from one another rather than forcing the entire country into a single regulatory model.
6. Consumer protection should protect consumers.
Fraud remains fraud. Negligence remains negligence. Misrepresentation remains actionable. Professional standards remain necessary.
The question is not whether rules should exist. The question is what those rules accomplish.
A regulation that protects patients from deception serves a legitimate consumer-protection purpose. A regulation that primarily prevents new competitors from entering a market deserves much greater scrutiny.
The distinction is between protecting people from harm and protecting institutions from competition.
What the Compact Could Look Like
The Transparent-Care Compact would establish a framework built around several mutually reinforcing reforms.
Price transparency. Providers participating in direct-pay markets could openly publish binding or clearly defined prices for common services and procedures.
Direct contracting. Patients and providers could enter voluntary cash-pay, subscription, membership, or bundled-care arrangements without unnecessary interference from third parties.
Interstate competition. Consumers could purchase qualifying health insurance products offered in other states, subject to clear disclosure of which state’s regulatory framework governs the contract.
Portable employer contributions. Employers could contribute toward independently owned healthcare accounts or qualifying insurance arrangements rather than tying employees exclusively to a company-selected plan.
Catastrophic insurance. Insurance markets could place greater emphasis on protection against major financial risks while allowing routine care to develop more transparent direct-payment models.
Expanded provider competition. States could reconsider scope-of-practice restrictions, certificate-of-need laws, and other barriers that limit the supply of legitimate healthcare services without a corresponding improvement in patient safety.
Transparent pharmaceutical markets. Patients should be able to understand the cash price, negotiated price, and relevant intermediary costs associated with prescription drugs whenever practicable.
These reforms do not require every American to purchase healthcare in the same way.
That is precisely the point.
A competitive system allows different arrangements to coexist.
What This Might Look Like in Practice
Suppose a patient needs a routine MRI. Under the existing system, the patient may know the amount of the deductible but have little idea what the procedure itself will cost. The hospital may quote one amount. The insurer may have negotiated another. A freestanding imaging center may charge something entirely different.
Under a transparent market, providers could compete openly. One provider might offer an MRI for $450. Another might offer an MRI with radiologist interpretation for $575. Another could offer a same-week MRI package for $625. The patient could compare location, physician recommendation, accreditation, reputation, scheduling, and price.
That does not turn medicine into a commodity. It gives the patient information.
The same principle can extend to primary-care memberships, laboratory work, imaging, outpatient procedures, physical therapy, prescriptions, and many other services where prices can reasonably be established in advance. Complex emergency medicine will never function exactly this way.
It does not need to.
Markets do not require every transaction to be identical. They require space for competition wherever competition is possible.
We Already Know Parts of This Can Work
The Transparent-Care Compact is not based entirely on theory. Organizations such as the Surgery Center of Oklahoma have demonstrated that medical providers can publish bundled cash prices for surgical procedures. Direct primary care practices have shown that physicians and patients can establish subscription relationships outside traditional fee-for-service insurance billing. Independent imaging centers, laboratories, pharmacies, urgent care centers, and telemedicine providers have demonstrated similar opportunities for direct competition.
None of these examples proves that one model can solve every problem in American healthcare. They demonstrate something more modest—and more important.
Healthcare does not inherently require opaque pricing.
Opacity is, at least in part, a product of the institutions we have constructed around it. Institutions can be constructed differently.
The Constitutional Framework
The Transparent-Care Compact rests on a deliberately limited conception of federal power. The federal government would not establish prices, determine medical treatment, license physicians, or operate a national healthcare system. Its principal role would be to protect lawful interstate commerce and prevent artificial barriers to Americans purchasing healthcare services and insurance across state lines.
States would continue exercising their traditional authority over medical practice, professional standards, facility safety, malpractice, fraud, and consumer protection. This creates an important division of responsibility: Washington protects the market between the states. The states protect the people within them.
Neither role requires centrally managing the healthcare choices of every American.
What About People Who Cannot Afford Care?
A freer healthcare market does not require society to abandon people who cannot provide for themselves. That is a separate question from how healthcare itself should be organized.
Public assistance, charitable medicine, state programs, community organizations, health savings subsidies, or other forms of support can exist alongside competitive healthcare markets. The critical distinction is between helping someone purchase a service and controlling the entire system through which that service is provided.
We do not need to make food markets opaque in order to provide food assistance. We do not need government to manufacture housing in order to provide housing assistance. Likewise, helping someone afford healthcare does not inherently require eliminating transparent prices, direct exchange, or competition for everyone else.
A society can provide a safety net without turning the safety net into the architecture of the entire market.
This Is Not a Claim of Perfection
No healthcare system will eliminate scarcity. No reform will make every treatment inexpensive. No competitive market will prevent every bad actor. No regulatory system will prevent every mistake. And no policy framework can eliminate the difficult moral questions surrounding illness, disability, aging, emergency medicine, or end-of-life care.
The Transparent-Care Compact makes a narrower claim:
When people are given transparent information, meaningful choices, and greater freedom to exchange with one another, competition and accountability have room to emerge.
That principle works throughout much of human economic life. Healthcare should not be presumed uniquely incapable of it.
Why This Matters to The Captured Economy
The central argument of The Captured Economy is not that government is inherently bad or that markets are inherently good. It is that institutions shape behavior.
Rules create incentives. Incentives influence decisions. Over time, those decisions shape entire industries.
Healthcare provides one of the clearest examples. When prices are hidden, consumers cannot compare them. When consumers cannot compare prices, providers face less pressure to compete on price. When insurance becomes attached to employment, workers become less mobile. When regulations impose enormous fixed compliance costs, large institutions gain advantages over smaller competitors. When market entry becomes difficult, incumbents become more valuable. When incumbents become more valuable, organizations have stronger incentives to influence the rules governing their industries.
The result does not need to be a conspiracy. It can emerge naturally from the incentives we created.
The Transparent-Care Compact asks what happens if we change those incentives. Not by designing the perfect healthcare system from above, but by giving people enough freedom to begin discovering better systems for themselves.
An Invitation to Think Differently
The Transparent-Care Compact is not offered as the final word on healthcare reform. It is an invitation.
Remove an unnecessary barrier. Make a price visible. Allow another competitor. Give a patient another choice. Let states experiment. Let successful ideas spread. Let unsuccessful ones fail without requiring the entire country to fail with them.
Then observe what people build.
Because sometimes the most important policy question is not:
What should government create?
It is:
What could people create if government gave them room to try?
The Transparent-Care Compact is a policy framework and thought experiment exploring market-oriented healthcare reform, federalism, transparency, and institutional incentives. It is not medical, legal, or insurance advice.