Reviving public provisioning in U.S. health care

By Hayden Rooke-Ley, Dana Brown, and Colleen Grogan

Health Affairs Scholar, Vol. 3, No. 3

March 17, 2025

As new approaches of political economy gain ground in some sectors, American health care still reflects many aspects of neoliberalism. In this piece, we build on proposals to reorient health care policy around a new industrial policy for health. A core component of this strategy—and our focus here—is a revival of public provisioning of medical services and pharmaceuticals. Although less prevalent today, forms of public provisioning still exist in vital ways. These models demonstrate how public provisioning can not only address urgent capacity needs—it can promote local ownership, operate as a competitive public option that bolsters worker power, and assure societal return on public investments.

Introduction

Despite experimentation in certain sectors with new paradigms of political economy, American health care still exhibits the many hallmarks of neoliberalism. The privatization of Medicare typifies an overreliance on market making and consumerism, even as it drives up costs and builds private power with public dollars. Widespread corporate consolidation, pursued in the name of efficiency, increases costs and often reduces access for low-income patients. The financialization of care delivery—instantiated by private equity, insurance conglomerates, and profit-oriented “nonprofit” hospital systems— prioritizes returns for investors and corporate management over the production of health. The broader picture is one of neoliberal “re-regulation”: it is not that the health care state has receded—indeed quite the opposite—but that it has been repurposed to empower large corporations and financial investors over popular democratic demands.

“This approach would emphasize questions of ownership and governance of health care institutions and would think deliberately about when and where markets should be deployed and how to structure them to foster fair competition.”

In response, calls are emerging for a new health care paradigm to join the existing ferment of industrial policy. As we have argued elsewhere, this agenda would combat corporate consolidation and empower clinicians, patients, and the health care workforce. This approach would emphasize questions of ownership and governance of health care institutions and would think deliberately about when and where markets should be deployed and how to structure them to foster fair competition. It would also emphasize long-neglected “supplyside” factors: how we build and properly allocate the capacity and labor supply to meet growing care needs.

Core to this agenda should be a revival of public provisioning, which we define as medical care and pharmaceutical production that is owned and governed by public institutions. Public provisioning has always been a feature of American health care delivery, although it began to wane following the Great Society initiatives, which substantially expanded public financing of private infrastructure through public insurance subsidy mechanisms (ie, Medicare and Medicaid). The decline of public provisioning accelerated with the neoliberal turn, as an ideological attraction to privatization and markets took hold. Nonetheless, as we explain here, public provisioning still exists in vital if less visible ways today. These models demonstrate how public provisioning can promote local ownership, serve as a competitive check on private industry, and assure that society benefits from public health care investments.