TightWind is written by Kyle Baxter. Stay Hungry. Stay Foolish.

Avik S. Roy:

Under the current system, drug companies have an incentive to compete on price. If you have health insurance that covers birth control today, your insurer is likely to charge you a higher co-pay for expensive, “branded” versions of birth control over cheaper, generic ones. If you don’t have health insurance, and you’re buying the Pill directly from the pharmacy at Wal-Mart, you have even more incentive to shop on price.

Under the new mandate, this price incentive disappears. Insurers will be required to pay for any and all oral contraceptives, without charging a co-pay, co-insurance, or a deductible. This “first dollar coverage” of oral contraception kills the incentive to shop based on price.

Wal-Mart sells Sprintec oral contraceptives for $9 per month.

Roy’s right, but increasing health costs only helps proponents of a public system. If costs increase, they can argue that the private market is failing to control costs, and therefore we must make health care a public function.

That’s what’s happening. By mandating certain items for coverage, the federal government is assuming a greater and greater role in health care, moving us closer to a public system. At some point it will be inevitable.