First, Haislmaier and others at Heritage told me they’d like to see an end to certificate of need laws, which require health practices to get permission from a state board before setting up shop. Then, there could be an influx of, say, free-standing radiology practices that move in and compete with the radiology services a hospital provides.

“How many hospitals have you seen go under?” Haislmaier asked me.

“I mean, there’s been quite a few,” I said.

“Not enough,” he said. “Not the ones that need to.”

His point is that hospitals today resemble department stores like Macy’s: “It’s a bit of everything for everybody, but they don't do any one thing really well.”

He sees them being replaced by independent specialists—think Sur La Table and Foot Locker, except with orthopedic surgeons. Not only would these practices compete against each other, they would, theoretically, be free of the need to subsidize an expensive emergency room and other trappings of a hospital.

To that, Josh Bivens, the director of research at the Economic Policy Institute, said, “It’s not hugely persuasive to me that’s why healthcare is expensive.” (Because Heritage is conservative, I asked EPI, a left-leaning think-tank, to evaluate some of their arguments.) There are better ways, Bivens argues, to lower medical prices, like bringing in more foreign-trained doctors or loosening patent protections on medical devices.

All these Sur-La-Table doctors would be paid for with insurance that would, in Haislmaier’s vision, be quite different from the insurance plans most people currently get through work. He suggested insurers could start charging their customers more if they go to doctors whose outcome measures aren’t very good. So if a doctor seems to do a lot of faulty joint replacements, and a patient picks that practice, the patient might be charged a higher co-pay by the insurer. Or, health insurance could function more like homeowner’s insurance. The insurer could say, “‘This is what we think a hip replacement is worth. This is what we'll pay you,’” Haislmaier said. “And, you take it and go shop.”

Bivens and other health experts believe threatening sick people with extra financial pain is the wrong way to go. “The big-ticket stuff in health care is long-term, chronic illnesses,” he said. “That’s not when people are at their best as thrifty shoppers.”

(Haislmaier counters that “it’s a reasoning error in thinking that everyone has to be a perfect consumer for a market to work.” In other words, insurers could tell patients what the best doctors are.)

In the conservative health-care future, not every procedure and test would go through health insurance. Haislmaier and some of his colleagues endorse “direct primary care,” in which doctors would be treated like internet service or a Chinese buffet: Pay a flat fee and get all the visits you want. Haislmaier said in most cases, these all-you-can-eat practices charge $135 a month or less. Some companies are already offering this service, he points out, like Qliance, a Seattle start-up that offers unlimited access to primary-care doctors for monthly fees ranging from $59 to $99.