You first have to agree on a definition of free in this context. When Adam Smith was writing the Wealth of Nations most of the transactions in the market were between entities with more or less comparable power. Local people bought stuff from local suppliers. This is very much not the case any more when it comes to transactions involving private individuals on one side and corporations on the other.
This is true but beside the point. I don't care either way what you count as a "free" market or whether such a thing exists, you can just say that health insurance is less free than almost any other market.
