To me, the problem is lack of competition. The government should remove or sharply curtail licensing laws, or expand them to other professions substantially, and eliminate or loosen drug schedules (the new kratom fiasco is just one example of many spanning decades of how inept the government is at regulating substances). Basically, decriminalize and deregulate drugs completely. Let the FDA focus on purity and rigorous testing and education, but take away its regulatory authority beyond that. Let pharmacies produce more drugs, and get the government in the business of producing drugs. Nothing will drive down drug prices faster than a public entity producing drugs in competition with private corporations. Give tax incentives to businesses for producing or researching drugs in the public interest.

It's madness to think that somehow problems with overregulation and monopolies are going to be solved by increasing regulation and monopolies.

this is exactly how most people think.

i would rather say that it is madness to think that government will get into drug manufacturing (or manufacturing of anything for that matter) rather than quietly collect donations from interested parties in exchange for a signature.

State supported entities competing with private ones is now "free market?"

I worked at a startup that dealt with international reimbursement and we accepted less in France because it was just how it was done. We got paid much more in Germany and the UK. In the US we got paid a lot from some people and sold a very similar product to Walmart for 1/5th the cost.

This was a small startup, not a global pharma company, though we worked with a few and saw similar patterns at play. History, as much as politics and economics, shapes the industry in profound ways.

You would think, but they don't. That's the problem. Why? I don't know.

Car insurance is a similar thing. My SO barely tapped the car in front of her at a stop light. No damage, even though the woman flew out of the car claiming her car was damaged (we have pics of no damage) and that her children were injured (two boys in the back seat without seat belts or car seats). My SO asked the boys if they were OK and they laughed and said "yes."

So, a month or so later I get a call from the insurance company they've settled for medical bills of > $10k and damage to the car for ~$4k. I was livid and told them I wanted them to fight this fraud. Nope, they wouldn't do it. I begged the agent for 20 minutes. It's cheaper to settle.

It would clearly be in the best interest of the insurance company to crack down on fraud, but they feel it's "cheaper" to settle and move on.

I think the same mindset exists in the medical insurance industry.

A year later my insurance settles with the guy for $4k, and my insurance premium almost doubles.

Medical insurance is the same because the insurer, the drug company, and the doctor ALL benefit from increased prices.

No, they don't. With ACA, insurance companies must spend 85% of their revenue on medical. This means that their profit margin is effectively capped and the only way for the industry to increase profits is to increase the amount they pay out to providers, pharma, etc. so, no, the insurance company does not have every incentive to negotiate. In fact, sadly, most of the time it's the opposite.

For example, I needed a specialized MRI, doctor orders it at the hospital, approved in one day. Before I do it, I find out that the allowed amount is $30k, insurance will pay $27k and I will be responsible for $3k. Before insurance would've fought me tooth and nail on this. I eventually find a place that that tells me they'll bill $1.2k to insurance but can't tell me what insurance will allow. It takes them three times and two weeks to get the insurance approved. My final copay ends up being $55.

While healthcare has always outpaced consumer inflation, I have noticed a massive increase in the rate for hospitals and pharma, while my doctors are all actually being paid less than 5 years ago. In 2010 my doctor would get $100-120, now he gets $55-75 for the same visit. Meanwhile a simple blood test that would be $2 at my doctor or would have been $15 at hospital is now $50 at the hospital after the ACA. I think there's a lot more kickbacks and bribery going on.

> In 2010 my doctor would get $100-120, now he gets $55-75 for the same visit.

While not incorrect, the rates doctors get just for being in your insurance's network has gone up as well (doctors actually get paid to be in-network). A doctor might very well take a loss per visit but they get paid thousands (if they are in a very populous area with a big insurance company) to be in-network.

The ability to charge far more for a drug than pure manufacturing cost is what makes it possible to spend billions and decades researching and developing it.

That burden is mainly borne by US consumers, while the rest of the world mostly free-rides.

More meat: http://slatestarcodex.com/2016/09/07/reverse-voxsplaining-br...

For example if Drug A is negotiated to be for sale to the socialized medicine systems in Canada and France for $30 it cannot be sold for more than that here.

This allows the company to set whatever price they think is reasonable but without the US subsitizing their costs. It also allows the companies to sell their drugs at low prices to developing economies so that the people living there can still have access to lifesaving treatments.

Enough people would consider those things - even if they have an iota of truth - more important than universal health care, so they vote against the politicians who support it.

This assumes republicans do not adopt a single payer system in their party platform. I think that assumption is plausible.

So: it's good to know that things are different in other countries, but it doesn't actually address the point I was trying to make.

Of course single-payer works if we imagine that things in the U.S. are different from the way they actually are. Lots of things work that way.

I agree that the two-party adversarial politics in the US is poison though, and causes a whole lot of "this is why we can't have nice things" moments.

That's a fantastic argument for changing the way things are in the U.S. It happens one vote at a time.

The healthcare "market" in the USA is deeply, pervasively and often bizarrely regulated by the government.

Don't think of it as free market versus government regulated, because that's simply not true.

Let's not even go there. Let's look at a less regulated medical field of dentistry. Dentistry is relatively cheap and available because there is, while still heavily regulated, a market. I.e. you can call a doctor's office and get a quote for whatever procedures you want. Don't tell me that someone with acute toothache is in a superior bargaining position than someone with, say, elevated blood pressure.

So the market works pretty well when you don't over regulate it. I somehow doubt that bringing even more regulation in form of single payer will suddenly fix anything.

A few people have told me that they would actively misrepresent their network status so as to get estimates from a provider before going aahead with a procedure: https://www.quora.com/Is-it-easier-for-an-uninsured-American...

As others have mentioned, there can be a big difference between the list price and the actual price the insurer pays. The asthma market is highly contracted with big rebates going to payers.

Second, Medicaid does negotiate. First off, Medicaid get 23.1% off of every drug, just to start with. Then they can negotiate supplemental rebates if there is a lot of competition in a therapeutic area.

When you add it all up, Medicaid pays some of the lowest costs for drugs of any payer.

So, you pay $300 for the drug (list price). The insurance company uses that $300 to pay the drug company, which in turn, rebates $150 back to the payer. Pure profit!

If you are just responsible for the co-pay it works better. You pay $30, the payer pays $270 and the manufacturer rebates $150. Overall, the drug costs $150, $30 coming from you and $120 (net) coming from the payer.

That's not a value judgement of the patent system, it's just stating the obvious. A patent is a legally enforced monopoly, so of course there will be no competition while the patent is in force.

I am sorry but you don't like Free market. That's like saying "I love Hillary Clinton and I am totally with her, but I think Trump would be a better President than Hillary in every way because he is not dying".

My friend describes this as a 'Sales Pitch argument' where you claim to support your opponent's position, but you actually don't. "I am all for Gays to be able to freely marry, but we gotta make sure that the kids they adopt aren't going to abusive homes because statistics say that kids raised by gay and lesbian couples don't do so well".

> the final consumer is not in a position to bargain prices when getting sick, which is a pre-requisite for a free market to function.

I don't know from where does this kind of faulty thinking originates. Lemme show you why it is faulty:

The final consumer of food is not in position to bargain prices when he is hungry, which is a pre-requisite for free market to function. Therefore a single payer food system works better than a private food system.

The final consumer of a gun is not in a position to bargain prices when his home is invaded, which is a pre-requisite for a free market to function. Therefore a single payer gun system works better than private market for guns.

The problem is, you're not suppose to look for food only when you get hungry, or buy a gun precisely when you're getting invaded, you're suppose to do these things BEFORE you actually need them.

And just like food (which you need daily multiple times) you buy in chunk. The whole system of food acquisition works out perfectly fine.

Your rest of the comment is more to the point, and the way things are in America are antithetical to a free market in healthcare and pharma industry.

I have a chronic illness that requires me to take medicine every day; some prescription, some not.

For the prescription medicine I get a prescription from my doctor. It does not tell me the price of the drug, nor does it tell me whether there is a generic available, or another brand-name drug with similar effect. Even if I ask, the doctor typically has no idea how much the various drugs cost, and which are less expensive. They just say "your insurance will cover this."

I take it to the pharmacy. None of the pharmacies advertise their prices for this drug, so I have no reason to choose one over another.

I fill the prescription and go to checkout. The price will be different depending on which tier the drug is on at my insurance company, the copay for that drug, or whether I've yet satisfied my deductible. The only way to predict these things in advance is to read through dozens of pages of dense literature from my insurance provider. And by the way, I have no choice in insurance provider because my employer only offers one.

For the non-prescription medicine, the price is clearly marked in every store, and generics are clearly identified and merchandised right alongside the brand name. I have great opportunity to choose where and what to buy. And, no surprise, these are way cheaper than the prescription drugs.

Keep in mind that my need for, and usage of, these drugs is exactly the same. But the price is radically different depending on whether they come to through the clarity of the market or the opacity of the current health insurance system.

Part of that is that there is a very significant barrier in obtaining the knowledge needed in order for a consumer to be truly "informed", as medicine and chemistry etc. are hard subjects. Another problem is that a sick patient in need of medical emergency by definition is not going to be in the best place to make an informed decision -- and it's not like you always can chose things beforehand (example: what if you have a medical emergency while traveling?). So I don't think the gun / food comparisons are directly comparable, personally.

That being said, it is entirely possible to design a system that introduces plenty of competitive opportunities while keeping the above in mind. Personally, I think many single payer systems in the world are actually more free-market-friendly than the United States, in that there's provisions for competition from either/or private insurance and private health care facilities! Capitalism / free markets lose many of their advantages if they turn into monopolies that are able to strong-arm competition away with legislation... this pretty much is the situation with American pharmaceuticals, I'm afraid.

You are ignoring the fact that consumers can pick from a plethora of food options. When you have sickness A the ONLY option you have is medicine X (take this medicine or you die), where is the market force to drive down the price? That isn't free market

Sure, but if a country suffers famine, do people (and you) suggest single payer food system?

Yes! The government (payer) gets the food it needs to feed its people or...?

It's not an invalid argument to say you think markets are great excwpt where the preconditions for a well functioning market are not met. Many people think they are not met when it comes to healthcare, hence most of the developed world having socialised medical systems. The US is a weird outlier in that respect.

Medical emergencies are a popular counter-argument to the idea of greater market clarity in health care, but the reality is that most people encounter the medical system in non-emergency situations. They have the opportunity to shop around for these--but often don't, because they don't have the information or incentive to do so.

As for emergencies or unexpected costs--that is what insurance is properly for.

In a few limited industries, such as healthcare, I am much less in favor.

>you're suppose to do these things BEFORE you actually need them

Exactly. I paid full price in a single-payer system, not subsidized by anyone, where prices have been negotiated in advance, and it is a lot less costly. I paid even less than the co-pay in the US! I am insured here, so my insurance takes the rest, but it's super expensive for them. And therefore for me in my premium. The magnitude of the difference is insane, but it makes sense given the dynamics of that industry. Hence calling for a different system, just for that industry: it shows to be a more effective in many developed countries.

Whereas saying what you're saying is more akin to "I believe in science and reason as far as Christian god is considered, but in China I believe in Budda as the supreme deity".

My point is, that there is a reason why Free Market works, and government controlled economies don't. If you hold that model consistently you will find the reason why American healthcare system is so messy, and not that somehow govt controlled healthcare system works.

If govt controlled healthcare works, then govt controlled everything and anything could work.

> I paid full price in a single-payer system, not subsidized by anyone, where prices have been negotiated in advance, and it is a lot less costly.

Are you claiming that something fundamentally in free market which prevents you from doing that here?

>if govt controlled healthcare works, then govt controlled everything and anything could work.

Absolutely not: we have enough examples showing the opposite. Govt-controlled food prices usually does not work, and bargaining drug prices betwen a state and private companies actually does, in many countries!!

Free market is a tool, very efficient to serve the people in most cases. But if that tool does not work very well for the people of the Unites States in a particular industry, why not change the rule in that industry?

Afraid of entering of world of complexity where free market is not the only, systematic solution?

Reality is diverse, even if it's annoying intellectually.

A lot of drugs are patented, which means they aren't operating in a free-market. I can, however, choose any gun or any food.

And how can you know what disease you're going to get before it happens? Should I stock up on all possible diseases just in case?