Here is Jesse’s take on the high cost of healthcare. I’m sure our doctor friends can provide some insight.
28 December 2011
I am struggling a bit with the idea that reimportation back to the US of drugs made in America and sold to Canada is one of the solutions.
I believe Canada regulates prices, so they are much lower. So it does seem as that if one wishes to lower prices it makes more sense to merely emulate the Canadian approach, rather than add a Canada as a middleman.
One could make a decent case that the US consumer is filling the profit gap created by single payer price regulations in other countries.
I have not looked at it recently, but SGA (Sales, General and Administrative) Costs at big US Pharma firms had ballooned in the past twenty years as a factor on corporate balance sheets.
“In 1999, health administration costs totaled at least $294.3 billion in the United States, or $1,059 per capita, as compared with $307 per capita in Canada. After exclusions, administration accounted for 31.0 percent of health care expenditures in the United States and 16.7 percent of health care expenditures in Canada. Canada’s national health insurance program had overhead of 1.3 percent; the overhead among Canada’s private insurers was higher than that in the United States (13.2 percent vs. 11.7 percent). Providers’ administrative costs were far lower in Canada.”
New England Journal of Medicine, Aug 21, 2003
Blame government if you will, but based on my own look into this it is yet another instance of regulatory capture and a political campaign financing problem vis a vis influence peddling by powerful corporations.
The study below seems to try and make a linkage between direct marketing and high prices, but the only two countries that allow direct markets are the US and NZ, and NZ is later shown to be one of the lowest cost countries! So obviously it is something else.
Health care costs in the US are driven by the health corporations and Big Pharma, and are borderline insane, as most who have had a recent major illness in the States might attest.
Most of the physicians with whom I have discussed this felt the same way and have even stronger feelings about the healthcare monopolies formed of partnerships between hospitals and private healthcare insurance companies, and the marketing pressures and role of the drug and equipment companies in driving up costs.
And then of course there is the tort and malpractice system which is in the hands of Big Law. But that is a matter for another discussion.
Created by: Medical Billing and Coding