Medicare would become cheaper tomorrow if the government would negotiate drug prices down. Trump isn't going to do that.

Something like this?

[1] https://www.cms.gov/inflation-reduction-act-and-medicare/med...

Or manufacture drugs themselves, and distribute "at cost".

What leverage does the US government actually have?

Is "we just won't fund your drug, even though people will die and you're the only option on the market" actually something that could happen? Would that be politically palatable to anybody?

I guess there's patent invalidation and forced genericization, but that would kill innovation real quick.

I think a far better idea would be to impose very strict caps on admin / non-medical costs, potentially at the expense of paying a bit more to fraudsters, changing FDA regulations to minimize (death from side effects + death from no available drugs) instead of just the former, as well as becoming a lot more aggressive about expensive and unnecessary procedures that doctors perform to get rich quick.

The US pays much more for drugs than any other country. I guess one possibility is that no one has any leverage and big pharma is able to charge Americans more because they're richer. But the more popular theory is that countries can negotiate better prices than individuals can (yes, technically insurance companies can negotiate prices, but they seem unmotivated to drive any costs down). It seems the previous administration thought the government can negotiate lower prices: https://www.cms.gov/inflation-reduction-act-and-medicare/med....

How do other countries do it? Why is Ozempic $100/m in EU and $1000/m in the US. Cost to manufacture Ozempic is $10.

Yup. Was working for a major European blood product distributor as my first real job and the prices US customers would pay were just obscene.

Most EU countrys payed $40-$60 (per unit, shipped by 3rd party courier, who do their own billing), SE Asia and Australia $60-$80 and the US $1500-$2000. Before I left we started also shipping to Canada, dunno about the prices anymore, but substantially less.

The head of our institute was apparently involved in the negotiations and although I didn't get a chance to talk to him directly, the popular story was that our guys showed up, were presented with a pretty much done deal and told that the price and payment terms were nonnegotiable. Also, during meetings, he would refer to the Amis often as "Die, die nicht mehr alle Tassen im Schrank haben", which roughly translates to "The crazy ones."

Also, the product they wanted specified a significantly less complex and cheaper pooling procedure than we were able to offer...

They are negotiating with drug manufacturers. In the case there is only one, the negotiation just wouldn't go well.

Trump MO would be implement a 100% tax on pharma profits and unrealized capital gains next Monday, then reverse it once they agree. But only if Trump cares to die on that hill.

How can Trump change tax law?

Same way he created tariffs.

Wrong. Congress granted the Presidency an almost limitless power to levy tariffs in the early 1900s. It has no such power to change the tax laws.

He can simply take all pharma manufacturer portfolio off the medicare schedule, for example. That's what I would do, and it would be the right lawful move.

On the side, he may open the door for generic substitutes as well from CAN etc.

A simple price directive would be set at the same time, without any negotiation:

The price US medicare will pay will only be the average price for each drug, in all OECD countries.

Same way he's getting the executive to (apparently) dismantle federal departments.

With no legal precedent supporting him but absolutely no resistance from the branches of government meant to keep him in check.

As WW2 was ramping up there was only 1 aluminum manufacturer - Alcoa (Aluminum Co of America). When they hemmed and hawed that they could not increase production to meet the US war demands, the FDR administration made an investment to start Reynolds, who would go on to supply all of the aluminum needed to create thousands of ships and airplanes. Today they make foil and plastic bags. Alcoa still exists too as a much smaller fish in a much larger pond.

The government has all the cards, negotiation is really just a matter of will.

Sure, but that's not the law being discussed. It's literally a negotiation process.

That ignores the point of the story and what I was responding to.

If there is only 1 company to negotiate with, the government is really the only entity that can threaten to simply create a competitor and give them the IP rights (by legal fiat) to do so. If you tell the existing company that your alternative solution is to compete with them using taxpayer money, they might choose to take the lesson of history and accept the government's negotiating position.

I don't think it's the case that there are many conditions with only single treatment option. "Lower the price or we let our people die" probably isn't right, but "Our cost benefit analysis shows, at this price point, therapy X is preferable. If you want us to use your drug your prices need to be lower."

Presumably the government also has the option to permit purchase of pharmaceuticals from other countries. "Oh, you've raised the cost of X? That's okay, we'll buy it from licensed suppliers in the EU for a tenth of the price."

> we'll buy it from licensed suppliers in the EU for a tenth of the price

Actually is that possible? Are the EU suppliers allowed to resell at the gov negotiated price? Or are the gov negotiated price only for internal market?

(I've been wondering since I don't understand why swiss drug price are so much higher given that EU suppliers are next door)

A single-payer system is literally designed for this.

> What leverage does the US government actually have?

Literally all the leverage.

Im gonna start a downvote party on myself haha but here we go - if you want cheaper healthcare, get rid of the medical licence!! Let the free market work. Of course it wont be better but rich people will pay theough the nose for the top level of care, middle class will get the best care the market can provide for what they can afford and lower class will get someone regurgitating chatGPT - but it _will_ be cheaper.

I continue to post this, not even fully convinced - Im scared I wouldnt be able to afford good care without govt subsidies, but I am open to the idea at least. I dont think care in the USA would be worse overall

Look, the plausible version of this is spelled: "force the AMA to allow and the USG to fund more residency slots, so the supply of MDs can meaningfully grow, and the premium they demand be reduced. Also maybe let NPs and CRNAs and the like practice more independent".

But throwing medicine to the whims of the market is absurd. We're going to pick surgeons by reading reviews on Google?

Are medical licenses actually the cause of expensive healthcare?

i.m.o. a different, significant factor is excessive testing for protection against malpractice lawsuits

Also doctors can be compelled to sign enforceable, legally binding noncompetes. Unlike most of us, they have to move far away to change employers, thereby making competition in the health care space very difficult.

I wanna say yes but to be fair, I cant prove it. I think without licencing we would get reduced length degrees & more people like nurses transitioning into primary care physicians - and I think that would be fine for a lot of conditions

I don't think licensure is really that much of a barrier, though. One of the huge trends going on is that nurses are increasingly replacing doctors in primary care. In my market it's unusual to have an actual doctor as a primary care provider. These nurses just go through some additional training for a PA or NP license and it's still a great deal cheaper than medical school.

This happens to me (my PCM is a nurse) but funnily enough my costs haven't gone down. Those nurses still work under a qualified doc, who will never look at your file until youre nearly dead, but theyre still getting a cut believe you me.

They’re not ‘getting a cut’ unless they directly own the clinic. What you’re seeing is a cost-cutting measure increasing the bottom line for whoever owns the clinic. Physicians are forced to agree to ‘supervise’ midlevels as a condition of their employment these days.

I replied to your other comment but wanted to reply here to say that this is also probably a fair point. I guess I dont really see doctors as employees taking orders since theyre so highly paid, but probably thats how being a software dev looks to others aswell.

Im curious if you think malpractice insurance is also a significant, unnecessary cost? What of we made it harder to sue doctors?

In the last decade, private practice rates for doctors has dropped from ~60% to ~45%.

By me in FL, it's hard to find a doctor that actually has a private practice now. Most are corporate owned clinics where doctors are just employees.

The US only allows a specific number of people to enter medical training each year to be doctors. This is the reason we pay so much.

The financial incentives a specialist headache doc has whos spent the time and money to get to where they are would never tell a patient to eat less and radically adjust your diet for your ailment to go away, they wouldn't have patients coming back to them and they would go broke (that education was super long and expensive). I like the uncanny idea of getting rid of training requirements and let the free market handle it.

That kind of change though would leave someone with the bag and tends to never get voted or happen so we stay stuck in the over priced pharma, insurance, beating around the bush health game were in. Everyone is incentivezed to keep the bandaids rolling. Don't tell people their drug habits (I mean eating habits) are killing them.

Ohh wait, we got a new pgp blocker for you!

How about just skip breakfast.....

Letting the free market handle it equals letting quacks handle it. I really doubt quacks will be any more incentivized (or qualified) to do right by their patients.

I’d probably ask this question on a website for nurses, doctors, or maybe healthcare public policy folks. Instead of a website for programmers.

No it's largely just the magical "a market will fix this" thinking that's been ruining policy for decades. It's silly and doesn't work because the assumptions that go into the underpinnings of the economics theory about the functioning of free markets don't exist in many potential markets they want to apply the logic to. Health care isn't the same as shopping for a pair of shoes and it's mind numbingly stupid to me to try to treat them the same.

This is an uninformed take. A relatively small fraction of our healthcare dollars (~7%) are going to ‘providers’ i.e. doctors and nurse practitioners. I don’t have a source handy but this is easily searchable.

Most of the spiraling healthcare costs are attributable to administrative bloat, hospital profits, insurance companies and pharmaceutical profits. What you’re suggesting would just result in lower quality care in general and has effectively already been implemented with the rise of ‘supervised’ and unsupervised mid-level providers. I.e. NPs, PAs, CRNAs etc. It hasn’t resulted in any decrease in healthcare costs for the patient.

Let me give you some context for insight. If I see a patient in clinic for an intravitreal injection my fee will be $150-250 before overhead, the pharmaceutical company will be paid by medicare or private insurance around ~ $2000 for the drug that I inject. Double that for a bilateral injection.

If I operate at a hospital, my fee is $5-600. The hospital bills medicare a $4000 facilities fee plus additional fees for anesthesia, consumables etc. to the tune of over $10000 per eye.

If you want to lower healthcare costs a good start would be negotiating drug prices, repealing the clause in the ACA that bans physicians from owning hospitals, banning non-competes for healthcare professionals and getting rid of certificates of need that make it unnecessarily difficult to build outpatient surgery centers. In short, ideas that require a more nuanced understanding of our healthcare system.

Thank you for the reply. As in all things, I'm prepared to be wrong, if that 7% is indeed even ballpark accurate.

Hey, good attitude to have. I've been seeing this type of exchange less and less on HN, but agree completely that it's (reassessing their positions) something more people should be doing / willing to do.

For what its worth I did check this today and it seems to be more like 20% of healthcare is going to providers, not 7%.

However in the grand scheme of things this still isnt that bad, and I do think doctors/nurses deserve a good compensation, so given the problems associated, maybe we dont go with removing medical licences as a solution to healthcare costs