This just means American consumers end up subsidizing health care R&D costs for the rest of the globe — purely because our government prevents us from collectively bargaining the way pretty much every other country does.
The people coming to the US for the “best quality” are generally going to doctors / surgeons in private practice, most of whom do not take insurance and can see you immediately. There is an almost entirely separate (and much higher quality) medical system available to those who can afford it. The system the rest of us belong to ranks right behind Morocco and Costa Rica in terms of outcomes (not joking — this is according to the WHO). We come in dead last among “first world” countries.
The other problem right now is that it's not profitable to create drugs that actually cure anything. It's far more profitable to research drugs that help control chronic conditions (like diabetes, hypertension or Alzheimers) rather than drugs that can cure a condition outright. This is one part of why nobody researches things like antibiotics anymore.
A friend of mine works in pharmaceutical marketing, and the big revelation I got from him was that the marketing departments run the drug companies from the top to the bottom. If marketing doesn't see a billion dollar market for a new drug, it won't even be considered for clinical trials. The VC in biotech knows this, so they won't fund startups that don't have this potential.
There was a HN thread on this recently in relation to antibiotics. [1] Antibiotics are a special case for their own reasons, but ultimately if the potential for insane windfalls isn't there, big pharma is not interested.
Between the MRC and NIHR, the UK's NHS puts at least a couple of billions (Sterling) into clinical research each year, making them the largest clinical research funder in Europe. They're not researching generics. Oh and they were one of the original funders of PubMed Europe.
I can think of lots of things the government does better than the private sector, although admittedly outside the US.
How true is this though?
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC2866602/
> Objectives. We explored whether the United States, which does not regulate pharmaceutical prices, is responsible for the development of a disproportionate share of the new molecular entities (NMEs; a drug that does not contain an active moiety previously approved by the Food and Drug Administration) produced worldwide.
[...]
> Conclusions. Higher prescription drug spending in the United States does not disproportionately privilege domestic innovation, and many countries with drug price regulation were significant contributors to pharmaceutical innovation.
And
> In the United Kingdom, the pharmaceutical industry invests more of its revenues from domestic sales in research and development than do companies in the United States.
The US pays a lot for medication, but a lot of that money is used for things that are not innovation (eg advertising). Countries that have better free markets for medications don't see less spending on innovation, they see more spending on innovation.
Implementing something like what you describe, IMHO, would have the greatest positive impact on the health and welfare of Americans, of anything this century.
I have a friend who is very high up in one of the largest health insurance providers in the US, and I have often debated over the years with this person that same point, that the insurance layer is what creates the model for inefficiency, and abuse at the provider level ($5 Tylenol pill, $10 Band-Aid, minor treatments and return visits of dubious value, etc.), and that if we treated medical care as an ordinary consumer good, outside of the extreme emergencies that are bankruptigly expensive, things would be a lot better. The person I know at the insurance company doesn’t necessarily disagree either.
Neither of those scenarios are ideal.
If the only question was genetic differences, that’s a risk I think a lot of people would be willing to take (e.g., that I might be healthy until 100 and then die in your sleep, theretofore paying constantly for others who have had medical problems for 70 years straight). I myself would be willing to take that risk / pay for that style of universal coverage, if not for the aforementioned choice part (smoking, etc.) playing so heavily into the cost, in practice.
You are probably underestimating your own unknown non-lifestyle associated risk, along with the risks your offspring represent.
It also costs a lot to detect and judge risk factors, manage individual risk pools, assure compliance, etc. You save a lot of money by simply not bothering to risk-qualify eligibility and this offsets the costs associated with carrying lifestyle risks in a single large pool.
Assuming it's genuine, it's also misguided. Almost no-one wants to be obese, alcoholic, etc - accessible healthcare will reduce the incidence of all of these, which in turn will reduce the externalities associated with them.
You also don't need further state control to discourage smoking, drinking, junk food, etc - taxation is the mechanism used globally to discourage undesirable behaviour.
Almost all these things are biologically addictive, and furthermore the companies selling them have long known about their addictive qualities and then built marketing campaigns to ensure the public was not aware of the risks.
Taxation is how you recognize the externalities of this behavior while maintaining a free-market system.
Also, it’s easy to look at something like cigarettes which pretty much everybody would agree are a terrible idea, and say, “fine, tax em”, but what about when it’s sugar, then butter, then red meat, etc. Let people make their own choices instead, and just don’t put the onus on the rest of us to fix the problems of those choices. Banning smoking in public is acceptable because it’s no longer a choice that only affects yourself; it affects anyone near you in a really terrible way. But taxing cigarettes (or anything else) is no solution.
What happens is that when given the opportunity, business will pollute the market with proxy signals (like brand trust, or fear based selling) that people instinctively respond to.
These proxy signals will be subject to manipulation by well-capitalized actors and will not in general reflect outcomes or value. They will interfere with the fundamental signal, making it even harder to detect and interpret.
Therefore the market will not work, in the sense of delivering the best outcomes for costs.
(Note that I am strictly speaking of healthcare, where even experts are often unsure of causal relationships and the relative value of various therapies. In general I think markets are a wonderful thing. Here is an experiment to try... take a mild condition treatable by OTC medication, such as the symptoms of colds, allergies, etc, and see how long it takes you to identify, characterize and factor the available therapies, and then map this to available products. Evaluate interactions, cautions, effectiveness, risk, convenience, costs, etc. Now ask yourself, where did you get your information? Who did you have to trust? Why did you trust them? Is the basis for your trust and understanding available to the average person?
I've done the experiment. My conclusion is that healthcare large and small is not like other goods.)
I have firm belief in the fact that the market can more efficiently aggregate medical information but above all else create more rapid responsiveness to care. Bad products and actors are always seeded out over time in a society.
But they don't work like this all the time, for all goods.
Tetraethyl lead, which quite probably caused material long-term harm to entire generations, is gone because the bureaucrats banned it. The free market would never have phased it out organically in a reasonable time-frame, we know this because it didn't. The market participants fought for its continued use and obfuscated the issues to their advantage.
GlacierMD was explicitly an attempt to filter, aggregate and make available high-quality health-care information (i.e. improve the quality of the signal, which is necessary for efficient market functioning), and it did not find a value proposition in the market.
Except it doesn't -- what GlacierMD was trying to do is something that's currently done by humans at scale. Which he would have known if he understood the market better. This is a centralized function that is performed much higher up the chain and ends up in clinician / patient hands in the form of clinical guidelines.
This is maybe a useful tool for researchers to be used as one input in the development of clinical guidelines. But the functionality it delivers can be done manually (and will continue to be for liability reasons). In this case, the market worked. The author should be thankful he was able to get out of it only $40k in the hole.
I didn't claim it was. Only that our present standards incentivize fee-for-service and not outcomes-driven, as exemplified by the author's inability to sell his outcome optimizing software. ACA tried to remedy that with preventative care standards, but the current administration is actively dismantling it.
Your model works for cosmetic surgeries because they are cosmetic - optional and not life threatening.
When calculating price, the cost to produce a drug is the last thing on pharmaceutical companies' minds. The question they ask is how much are you willing to pay for something that allows you to continue living. The factors they actually consider: the patient's perceived cost-benefit of continued suffering, the credit/insurance-worthiness of the treatment cohort, and whether the company faces competitive pressures from others selling the drug on the market.
Nothing better depicts the situation than what goes on when pharmaceutical companies merge or acquire the rights to rarely used drugs[1].
The only way to structurally combat this is with the monopsony power of a single payer system.
>I can't think of anything that the government runs better than the private sector. Healthcare is no different.
Government run care has the highest satisfaction rate of any healthcare coverage[2].
1. https://www.nytimes.com/2015/09/21/business/a-huge-overnight...
2. https://news.gallup.com/poll/186527/americans-government-hea...
Then you are not very good at thinking. There is no theoretical, practical or empirical evidence that this should be true. If you _feel_ this should be true, you should really investigate where that feeling comes from.
Basically your post is just ideology without argument or evidence. All evidence shows that free markets in health care are terribly inefficient. If that doesn't align with your ideological priors, well, adjust your reality.
Honestly, as long we get rid of the mafia middleman a.k.a insurance company except for real catastrophic situations, I do agree that costs will plummet. Price transparency is another key aspect.
Healthcare doesn’t have this issue (except in emergency services), so public healthcare also doesn’t solve that. It solves problems such as the principal-agent problem, asymmetric information, improves collective bargaining, ...
GlaxoSmithKline British
Eli Lilly US
Sanofi French
AbbVie US
Roche Swiss
Pfizer US
Novartis Swiss
Merck & Co US
AstraZeneca British/Swedish
Johnson & Johnson US
(edit spacing)
Maybe in the US, other countries (e.g Australia) are not so inefficient.
In magnitude, not so much.
This is a completely false right-wing talking point. It takes 10 minutes to uncover how just totally bullshit this is.
Don't ever repeat again or anything remotely like it (aka the rest of your post).
https://www.ncbi.nlm.nih.gov/books/NBK50972/
https://other98.com/taxpayers-fund-pharma-research-developme...
The government never sees a return in any form on the money taxpayers put forth. But private companies do. Just waiting like vultures to snag whatever makes it through the proof of concept phase and claim credit.
>I can't think of anything that the government runs better than the private sector.
ISP's? Roads? Social services? Schools? Emergency Services?
This is a lie. Marketing budgets are approximately equal to R&D (https://www.bbc.co.uk/news/business-28212223) so you're off by several orders of magnitude.
> Most of the real "hard science" R&D is paid for with NIH grants.
Also not true. NIH grants are ~$40 billion/year whereas industry R&D are around $80 billion (https://www.statista.com/statistics/265085/research-and-deve...).
There are definitely lots of problems with the pharmaceutical industry, several of which are mentioned in that BBC article. But making hyperbolic claims that they essentially don't do any R&D isn't helpful.
Your own source doesn't even say that. In the exact BBC article you linked:
>But as the table below shows, drug companies spend far more on marketing drugs - in some cases twice as much - than on developing them
Here's some very very basic reading on the subject that you can find in 10 seconds of googling: https://en.wikipedia.org/wiki/Pharmaceutical_marketing
In the literally first sentence on this topic:
>pharmaceutical company spending on marketing far exceeds that of its research budget
Imagine living in a society where supposedly rational, intelligent people hold opinions that don't withstand the test of a few keystrokes; opinions that quite literally aid in the needless death and suffering of others while also just generally being a complete waste of time.
If you follow the citations for that Wikipedia claim (a very very basic step) you will see that they don't provide any evidence for an order of magnitudes difference.
I'm not usually in the habit of shilling for Big Pharma, but since you've taken such a condescending tone I'll make an exception and point out that according to that exact Wikipedia article you linked, literally the same paragraph on the topic mentions that the majority of marketing spending is on free samples. Unless you think that drug companies should raise their prices in order to fund more R&D (which would have the same effect as reducing free samples) this doesn't seem very objectionable.
Government-run healthcare isn't a panacea that will 'value human life' any more than the insurance companies. You are still a number in a database somewhere.
Most new drugs come out of the US and socialized governments create generics at a fraction of the cost, because they don't have to put any money into R&D.
The US is the back-bone of the medical system for the rest of the world and also has the best medical schools and best quality hospitals (the majority of people with money come to the US for life-saving surgeries..this has to tell you something).
We need to push the true costs of things to the patient, which will force the price down...not replace the existing inefficient layer of the insurance companies with an even more inefficient layer called the government.
This has worked with many cosmetic surgeries, which used to be very expensive, but aren't covered by insurance.
Insurance should only cover rare surgeries that can't use the free market to reduce the costs.
I can't think of anything that the government runs better than the private sector. Healthcare is no different.