In a classic essay published eight years ago, Milton Friedman asked a question still worth pondering: Why, after a tremendous increase in technology in health care, are we still unhappy?

Since the end of World War II, the provision of medical care in the United States and other advanced countries has displayed three major features: first, rapid advances in the science of medicine; second, large increases in spending, both in terms of inflation-adjusted dollars per person and the fraction of national income spent on medical care; and third, rising dissatisfaction with the delivery of medical care, on the part of both consumers of medical care and physicians and other suppliers of medical care.

An advancement in the state of the art combined with dissatisfaction and increased spending is unique to health care, he wrote.

Friedman blamed two factors: third-party payments, and the tax-exempt nature of (certain) health care purchases. He admits that European countries do a better job of restraining growth of spending, but at the cost of government rationing.

So what's the ideal? He offers the following:

The ideal way to do that would be to reverse past actions: repeal the tax exemption of employer-provided medical care; terminate Medicare and Medicaid; deregulate most insurance; and restrict the role of the government, preferably state and local rather than federal, to financing care for the hard cases. However, the vested interests that have grown up around the existing system, and the tyranny of the status quo, clearly make that solution not feasible politically. Yet it is worth stating the ideal as a guide to judging whether proposed incremental changes are in the right direct.

As it stands now, we're getting further away from that ideal.