This paper presents the case for a single national health insurer to replace the 38 private insurers now operating in the market. Although there would be scale economies, primarily in administration costs, in a single national insurer, such savings would be modest. The case for a single insurer rests on the intrinsic problems associated with having a number of insurers in the market. These include the under-provision of public goods which can reduce insurance claims (particularly public health initiatives), the incapacity of insurers to control price and utilization, and the moral hazard associated with insurance, which is more easily contained by a national public sector insurer.