The last part of an ongoing series that starts here.

Somewhere in Washington and New York and on college campuses and in think tanks throughout the nation a movement is building to radically transform the way health care is financed. But, unlike other revolutions, this movement will leave those who currently hold power - health insurance companies - in power. Its promise is that it will make some adjustments in their way of doing business and that it will make radical changes in the incentives faced by consumers and health care providers.

The legislation for this revolution was drafted by Senator Wyden of Oregon. A fairly straightforward description is found in a piece by Alain Enthoven in the SF Comical. David Leonhardt presents a case for the proposal in Wednesday's NY Times.

The basic idea is this: We keep the health insurers as the chief gatherers of money from the public and sharers of money with health care providers. These companies will continue their function in a new regulated environment, Health Insurance Exchanges, where they will have to issue policies at standard rates to anyone who wants on. The public will be free to choose policies offered on the exchanges. But with freedom comes obligations. Consumers will have to be insured and consumers who have employer provided plans will need to pay taxes on the cost of these plans. Consumer who cannot afford insurance will get subsidies to purchase private insurance.

The outcome  will be revolutionary.

The Health Insurance Exchanges will function as marketplaces for health insurance without some of the problems of current markets. Companies will not be able to refuse coverage or charge different rates for the same coverage depending on real or imagined health problems. They will not be able to lie about misrepresent their plans and one hopes that they will be required to abide by their contracts.

Healthy consumers will no longer be able to avoid paying for health insurance which change is expected to reduce the cost of insurance by spreading the risk.

One thing will remain the same. Health insurers will be able to provide different products that offer different levels of coverage. Specifically they will be able to provide inexpensive products that have high deductibles and other out of pockets expenses as well as more comprehensive policies that pay for most health care.

High out of pocket policies will be attractive to young people and optimists who have not yet experienced illness. These people will consider price more important than actual coverage and imagine that they will never really need to pay $5,000 to $10,000 in medical bills that the policies will leave uncovered in the event of a medical catastrophe. People who have actually had some experience of illness will be drawn toward the comprehensive plans.

High out of pocket policies will cater to the golden youth of America. They will have fewer claims and the claims will cost less since most of the money will come from the insured. As the youth flock to these policies the profits from these policies will rise.

People who want comprehensive insurance will find themselves in a geezer ghetto. They and their fellow suffers will have high medical costs due to their generally unattractive nature. Higher medical costs mean higher claims costs, mean higher premiums. As premiums for comprehensive insurance rise the more healthy of the geezers will join the golden youth leading to still higher premiums.

The proponents of Health Insurance Choice see this as a good thing. They consider comprehensive plans - plans that actually pay for ordinary health care - as luxuries. In fact the proponents of choice would like to stop us from choosing comprehensive health insurance. They will do this by taxing any income used to pay for plans that cost more than the cheapest plan on the insurance exchange. Likewise subsidies will only be available for the cheapest plan.

After the revolution. Some of us - if we have fairly high incomes - will continue stubbornly to keep our comprehensive plans paying higher taxes and higher premiums. We will tend to be sicker than the rest and will value comprehensive plans because they spread our medical expenses over time and avoid sudden disasters. The rest, the healthy and the poor, will be covered by high out of pocket plans. Plans where an $8,000 to $10,000 deductible is not uncommon and where cost sharing goes on even after the deductible is met.

And here comes the big change. What happens when someone in a family that is covered by a government approved, high out of pocket plan gets sick? Say a child gets cancer or type 1 diabetes or multiple sclerosis or cystic fibrosis? In any of these cases no payments will be made by health insurers until the deductible is met. After the deductible is met the family will be responsible for probably 20% of charges until the maximum out of pocket amount is met. Being conservative say $8,000 for the deductible and another $8,000 to reach the maximum out of pocket.

Meaning that a middle class family can kiss their house goodbye and start looking for an apartment in the low rent part of town.

And if the illness is chronic will the family be able to convert to a more comprehensive policy? Has anyone thought this one through?

So what if the family that has the sick child is already from the low rent part of town? Health Insurance will start covering medical services if the deductible is met but providers will have to collect the deductible and cost shares from the family with the sick child. It is more than likely that a great part of medical expenses will not be paid, will be paid late or will ultimately be written off as charity care.

Payment for most medical care will now be a private matter decided by the consumer and his or her health care providers.

To review the advantages of health care choice:

• Our fine system of private health insurance will continue. Which will leave established corporations in control of a large part of the flow of funds to health care. Mandatory insurance and government subsidies will increase the flow of funds.

• The risks taken by health insurance providers will be reduced. Since health insurers will sell policies that cover only a small part of medical expenses their profits and cash flow will be more stable. Investors will benefit.

• The government will collect payroll and income taxes on income used to pay for health insurance.

• The young and healthy will no longer be forced to pay for the health care of the old and unattractive.

• The sick, the old and those who breed inferior children will finally be forced to pay the costs that they impose on society.

• Doctors and hospitals will be inspired to economize on care, particularly for those who cannot afford to pay.

If this works we can expect to see the same principles applied to Medicare.