""I am not going to agree with your assertions on “market price”. What you describe is ideal-case scenario with unlimited access, perfect information and no outside influences. Buying and selling a sack of grain operates under these rules – there is plenty of grain, there are plenty of buyers, they are generally informed of the price and buyers are not forced to buy sack of grain 2.0 by outside entities regardless of its advantages over regular grain. Reality of health care “markets” is that it is a quagmire of patents, cross-licensing, multi-national regulations and exclusive provider contracts. You can argue that some or most of this is effects of government interference, but I have to point that you can’t possibly eliminate such interference and still have a system that produces safe products and protects investment into R&D."

As an aside, you apparently have not looked into the grain industry lately. I see your point, but was a bad example.
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Anyhow, on to the real point.

First of all, the inherent complexity in the market and consequences thereof is something you have backward. The pricing mechanism is *most* important in these complex scenarios. The more complex a supply chain, the more needed open mechanisms are to determining value.

While what you say regarding consumers not being fully informed is true - it does not *need* to be true. It is true in many cases, because the consumers have offloaded that responsibility to others. In the case of Insurance, they pay to have someone else make those decisions. In the case of Govt, the determination can be taken from them.

But there is no compelling blockade to consumers, in conjunction with their personal physician, learning to make rational choices based on simple metrics of known effectiveness vs price vs side effects, etc. Its important to remember that just because a situation exists currently, that it does not necessarily need to exist. In this case, it shouldnt.

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""How does a central entity, as in single-payer, determine the price? It does it indirectly – it evaluates all possible treatments against its budget and determines the best use of that budget according to best possible outcomes. This results in a system that rationally assigns available dollars toward producing best possible outcome for the entire population, not an individual. If you price your treatment too high, it doesn’t get purchased. Occasionally, if treatment is deemed to be a question of national security (e.g. there is an epidemic, and you hold a patent for vaccine), there are no alternatives, and you are entirely unreasonable in your pricing, then government revokes its protection of your intellectual property in its jurisdiction. At no other point “men with guns” enter this negotiation, but there are plenty of accountants with spreadsheets that do.
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You say evaluates a treatment against a budget. But how does the determining entity do that, without any pricing data? Secondly, who determines what constitutes a "best" outcome? One persons opinion of "best outcome" is not going to be the same as another. In your scenario, there is no larger market setting the price. Also as noted, R&D would be way down. This sounds an awful lot like a few people making life and death decisions for the many. What prevents these few from simply making decisions that are in their own best interests - as is the status quo of our Govt in most regards for about the past 12 years?

Also, you have not "demonstrated" that such a system contains cost. You have made that assertion, but have made no inroads in modeling such a scenario where that occurs. Large scale systems where this style of intervention has been implemented have failed without exception. Small scale (relative) systems where that type of intervention has been implemented have been shown to be a faulty model for basing predictions of the behavior or larger systems.

""As to reduction of R&D under single-payer system. Government also sponsors a substantial portion of medical R&D, US have some of the most productive R&D programs covered with NIST grants. Even if all private research stopped, and it wouldn’t even with the worst case scenario, research and progress will still continue. Alternative that we are living in is having 50+ years old products withheld from the population and complete inability to control costs.""

Research and progress would certainly slow. Also expect "large sucking sound" as people in the field go somewhere where their activities are profitable.

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Your argument seems based on two tenets now:

1) That it would "control costs" , while it might technically control the amount of dollars spent.. the human cost in terms of stagnation, waiting lists, shortages, etc would be very high.

2) Private R&D is so inefficient that it is not worth having. Try telling that to a diabetic, an allergy sufferer, a heart attack victim, etc

The only silver lining I see to your plans, is people would start trying very, very hard to keep healthy.

Also, a big part of the cost savings you are looking for could be found if importation of drugs was legal. The pharma industry tries to keep it illegal, so when they charge other countries less US citizens cannot import it for less money. If we just made the rest of the world also help support those R&D costs and not just afterthough profit-taking... our own costs would go down a lot.

Just another example of Govt screwing us. You say that we "can never get govt out of health even if it causes problems so lets embrace govt"... but provide no evidence than even if all your other assumptions were true, that govt would ever work in a way that favors us. It doesn't now, so what would change?

For who could be free when every other man's humour might domineer over him? - John Locke (2nd Treatise, sect 57)