The Veteran’s Health Administration (VHA) is the best care anywhere, and its per-capita cost is low. Phillip Longman has a 2005 Washington Monthly article and a 2007 book on the superiority of the VHA system.

[W]hen it comes to health care, it’s a government bureaucracy that’s setting the standard for maintaining best practices while reducing costs, and it’s the private sector that’s lagging in quality. That unexpected reality needs examining if we’re to have any hope of understanding what’s wrong with America’s health-care system and how to fix it. It turns out that precisely because the VHA is a big, government-run system that has nearly a lifetime relationship with its patients, it has incentives for investing in quality and keeping its patients well–incentives that are lacking in for-profit medicine.

He cites a number of studies that rank the VHA at the top. He also explains how our standard fee-for-procedures model has negative incentives for quality care, and the resulting disaster, e.g.:

All told, according to the same RAND study, Americans receive appropriate care from their doctors only about half of the time. The results are deadly. On top of the 98,000 killed by medical errors, another 126,000 die from their doctor’s failure to observe evidence-based protocols for just four common conditions: hypertension, heart attacks, pneumonia, and colorectal cancer.

I’ve not read his book, but I consider his article to be mandatory reading for anyone who cares about healthcare.