In the current discussion of our health care problems, two key words keep popping up: “perverse” and “incentives.” Because most doctors are paid for services rather than outcomes, they have a perverse incentive to order superfluous tests and other procedures to run up their bills. Tax breaks for businesses who pay for their employees’ insurance create a perverse incentive for carte blanche policies that cover non-essential treatments. Overly generous insurance gives patients a perverse incentive to go to the doctor every time they have the sniffles. The medical malpractice snake pit motivates doctors to practice costly “defensive medicine” to protect themselves from ruinous lawsuits.

“The system of medical reimbursement warps incentives for doctors, insurers and patients that lead Americans to consume more and more medical services,’ according to The Economist. “There is strong evidence that Americans use pills, procedures, scans and other expensive forms of health care more than do patients in other rich countries and not always to good effect.”

The health care debate is also muddled by ideological intemperance. The word “universal” is a kind of magic charm to some who believe that if everyone is “covered” all problems are solved. As with all our debates, demonization drowns out thought. Bogeymen such as “Big Pharma” and “Socialized Medicine” are evoked as conversation stoppers.

We often hear that Medicare is “more efficient” than private insurance. “The administration of Medicare,” wrote one columnist, “is a miracle of low overhead and a model, despite all the fraud and abuse, of what government can do right.” That’s like saying the Russian Zaporozhets showed that communism could build an economical automobile — if you ignore the car’s tendency to break down and sometimes explode.

Anyone who’s dealt with government knows that “bureaucratic efficiency” is an oxymoron. Medicare is “efficient” because it maintains a minimal crew of doctors and clinicians and puts much of the burden of administration on doctors, hospitals and insurance companies. Its costs are low because it “uses formulaic rules made in Washington to set broad and inflexible restrictions on medical practice,” according to one industry authority.

A number of things could be done to reduce costs and improve health care without some grandiose plan dictated by Washington. One of the towering defects of employer-paid insurance is that it’s not “portable.” If you leave your job, you lose your insurance. A new insurer can reject you for “pre-existing” health problems. If we paid into a lifetime program at the start of our working lives, the insurance company would profit in the early days of our good health and build up a reserve to pay for a hip replacement or heart surgery when we’re old.

One reason health insurance is so expensive is that it pays for things most of us could pay out of pocket. If we paid for routine medical care, we might be more careful about spending and inclined to shop for the best deal. Medical insurance would cover catastrophic costs.

Debates remain unsettled and questions unanswered, yet the politicians are yelping about the urgency of “getting something done.” Medicare expenditures are twice as high in McAllen, Texas, as in El Paso. Similar variations are countrywide. We ought to know why. There’s compelling evidence that greater expenditure yields worse results. Shouldn’t we get to the bottom of this paradox?

In Grand Junction, Colo., “doctors collaborate to increase prevention and the quality of care, while discouraging overtreatment, undertreatment, and sheer profiteering,” according to an article in the New Yorker. Shouldn’t we be looking into the secrets to their success?

Lack of competition among operators of American hospitals is another factor driving up costs. More transparent doctor and hospital fees would promote competition and drive costs down. The tax break for employer-paid health insurance ought to be eliminated — or extended to those who pay for their own insurance. Removing the tax break would produce revenue that could help pay for covering the indigent and uninsured. Reforming the malpractice system — making it serve the victims rather than the lawyers — might reduce “defensive medicine.”

Instead of taxing the rich to pay for covering the uninsured, why not remove them from Medicare, a system that’s going bust and threatens to torpedo the nation’s economic future? Some argue that politicians want even the rich on Medicare because they want to make everyone dependent on government. No doubt they salivate over the idea of getting control of health care, which represents almost 20 percent of our economy. In fact, getting politics out of health care would do more than anything to lower costs.

Addressing perverse incentives that drive up costs ought to be the priority of health care reform. But the current initiative, conceived in haste and promoted by apocalyptic rhetoric, seems to be ignoring these issues. Of course, behind every perverse incentive is some interest group that’s profiting — and making campaign contributions. Reforms would require sacrifices from powerful lobbies: senior citizens, unions, lawyers, the medical industry, all of us. Does anyone believe our politicians have the will, wisdom and courage to require sacrifices from a society that’s come to believe it’s entitled to everything?

Increasing longevity is going to make ever-greater claims on our resources. A disproportionate amount of health care money is spent on the last months of life. A potentially bitter generational conflict looms: the young who pay versus the elderly who consume. Difficult choices lie ahead.

No matter how the politicians try to control health care, the market will ultimately defeat them. Health care is already becoming a global enterprise. People travel to countries such as India for major operations competently performed at a fraction of the cost in America. Competition and freedom of choice will win out in the end, to the benefit of all.