Actually in a 100% capitalist/free market economy its all about evolution and survival for those health care companies.
Organizations who bog themselves down in paperwork and red tape will lose money and not be successful. People will not want to pay higher rates for poor service and will go to a company who can provide better service at a lower cost.
Look at the cell phone market for example. Users have a great choice in the providers they can choose from and a wide selection in the cell phone models they can buy. This keeps cell phone service providers keeping service excellent while providing new (hopefully exclusive) features such as DirectConnect or multimedia messaging or wireless web/email at a lower cost than their competitors.
It is about freedom of choice.