The answer is unleashing markets—not government.

I hear loud and clear from people in my state, and from across the country, what they want to see in health care. They want it to cost less, have the highest quality and see that it extends to all Americans—even when they lose their job or when they're sick. Republicans agree. So do Democrats. Where we disagree is how to get the job done.

Our divide is fundamental: Republicans believe health care can be best guided by consumers, physicians and markets; Democrats believe government would do better. Some Democrats would have government buy health care for us; set the rates for doctors, hospitals and medicines; and decide what medical treatment we would be entitled to receive for each illness. If you liked the HMOs of the '80s, you'd love government-run health care.

Democrats have been winning. When President Lyndon Johnson signed the Medicaid bill, he estimated it would cost $500 million. Today, it costs $500 billion. Politicians have expanded government coverage to more and more people. They propose that we adopt European-style, government-financed health care. But, in some respects, they've already gotten us there: the government now spends more per citizen on health care than do the governments of France, Germany, the United Kingdom or Sweden.

But government can't match consumers and markets when it comes to lowering cost, improving quality and boosting productivity. Compare the U.S. Postal Service with UPS and Federal Express. Stack North Korea against South Korea.

The right answer for health care is to apply more market force, not less. Here's how:

1. Get everyone insured. Help low-income households retain or purchase private insurance with a tax credit, voucher or coinsurance. Use the tens of billions we now give hospitals for free care to instead help people buy and keep their own private insurance. For the uninsured who can afford insurance but expect to be given free care at the hospital, require them to either pay for their own care or buy insurance; if they do neither, they would forgo the tax credit or lose a deduction. No more "free riders."