What is the most efficient way to pay for health care?

Proponents of a single-payer governmental system content that patients should not have to pay the cost of their health care decisions and that the government can effectively control costs through top-down mandates.

On the other hand, opponents of such a system maintain that the most effective way to curb costs is to have patients bear a portion of their health care costs — such as routine expenses — and that the government canít efficiently control costs without rationing care.

In a recent JAMA op-ed, Dr. John Ford provided this graph (H/T Jeff Miron) to reflect the increase in third-party payment of health care expenses over the past half-century and the decrease in patient payment of expenses over the same span. Health care costs have skyrocketed over the same period.

Why should anyone believe that reform that continues the trend toward more third party payment of health care expenditures is going to result in meaningful reduction of health care costs?