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The US spends more on healthcare for no gain says new report from Johns Hopkins

jhsph.edu

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Re: The US spends more on healthcare for no gain says new report from Johns Hopkins

#391

It's worth noting that the U.S. market does pay for the lion's share of patented drugs, effectively funding a significant portion of R&D that benefits the whole world years later when generics come into market (at least for those drugs which are not costly to manufacture, which happen to be the majority). I'm not saying this model is right. I'm just saying that doing away with it will have fundamental consequences to…

It's true. But the US drug marketers also move lots of money to television companies (watch any non-sports show and look at the ads). They finance lots of perks for prescribers. Their clinical trials for new compounds are extremely expensive, freeway-tunnel-under-harbor expensive, Carl Sagan expensive (billions and billions). They pay generic-drug manufacturers to refrain from making competitors to their compounds fo…

Can confirm. And it affects medicine outside the US as well.

A bit over a decade ago, one very popular modern antidepressant drug used to be citalopram (cipramil). This is the racemic mixture (meaning it contains both the left and right-handed versions). The new one, escitalopram (lexapro) only contains the active stereoisomer. Its dosage is exactly half of the previous version because racemic mixture always (?) occurs in an exact 50/50 proportion.

Both drugs work perfectly well. No statistically significant difference in effect or side-effect. You just don't get the inactive half of the molecules.

Escitalopram wouldn't exist if it weren't for citalopram's patent expiring. Or maybe they were just sitting on the purified version, biding their time.

This is a straight counterexample of the argument that the insane costs of the healthcare system in the US somehow pays for new drug research all over the world.

This industry called "drug research" simply isn't motivated to improve health (not just "find better drugs"), they are just researching whatever is driven by profit.

They will just as happily waste billions of research on a drug that is almost literally identical to one that already exists and is known to work, a copy that nobody needed, only so they can patent it again.

At least they replaced it with something equivalent, instead of something worse. Because they would if they could (and given the state of reproducibility of medical research, probably did at some point or another).

That is not research, that is throwing money into a bottomless pit. Which is what the featured article is about.

Drug research in the US is no exception. You could do so much better research if it was done efficiently (and as a bonus take some pride in your work).

The fact that US drug research dominates the world market is not something that the rest of the world should be thankful for. You waste billions upon billions on such an industry, of course it's gonna dominate. Doesn't mean it's good. Other countries could do efficient drug research but if they don't get billions budgets (because you don't need it), they can't waste it on marketing and push their version of a drug no matter what.

Just because something is expensive, doesn't mean it's good.

Re: The US spends more on healthcare for no gain says new report from Johns Hopkins

#392
post #384

Earlier quoted context omitted.

"there is no reason my money should pay for the care of others" Isn't the cultural issue largely a idealogical issue - things like the UK NHS are avowedly socialist? In the words of Aneurin Bevan, founder of the NHS: " A free health service is pure Socialism and as such it is opposed to the hedonism of capitalist society." https://en.wikipedia.org/wiki/Aneurin_Bevan Personally, at least when it comes to healthcare, I…

Kind of. As a Brit I don't think the UK is especially socialist. Also we don't generally think of the NHS as socialist more than Americans would talk about having a socialist army or police force. The fact that the above are funded by the government from tax in my view doesn't really make them socialist. It's more just a common sense way of funding some stuff. The dictionary has socialism as "means of production, dis…

Healthcare is broadly a service and thus what hospitals, GP surgeries, etc. produce in the economy.

The NHS is a socialised system based on socialist ideas and indeed can be seen as a socialist construct within a capitalist overall economy. Nothing inherently wrong with that, that's just objectively the way it is. Bevan just said it the way it is.

Now, the military and police are regalian functions of the state. The government and regalian functions cannot really be labelled 'socialist', that would make much sense.

Re: The US spends more on healthcare for no gain says new report from Johns Hopkins

#393

Earlier quoted context omitted.

This is common PhRMA talking point that needs perspective. Large pharmaceutical companies spend twice the their readers h budget on marketing, a good percentage of now is that is spent on patient oriented marketing. (e.g. “Talk your doctor about Xyzzy!”) If there would be a loss of revenue, any reduction in R & D costs lies purely with c-suite’s priorities. https://www.washingtonpost.com/news/wonk/wp/2015/02/11/big-p…

They spend on marketing because they are trying to sell as much as possible of the drug during the patented years. If people do not realize there's a superior drug out there, they will never part with the money for the improved treatment

That's a bad argument because the drugs are heavily marketed regardless of being superior or not.

Re: The US spends more on healthcare for no gain says new report from Johns Hopkins

#394
post #97

Earlier quoted context omitted.

That doesn't mean anything at all. The problem is dissipation of rents -- when an industry gets an economic rent, expenses will tend to increase to the maximum allowed by market discipline. This is true for all bureaucracies -- e.g. Universities are always out of money but keep charging more. Hospitals are always out of money but still charge too much. That a firm finds a way to spend the money does not mean that the…

So where does the money physically go? If I’m a rent-seeker, I still have an incentive to be stingy with my expenses. The only reason I wouldn’t would be if someone else had a monopoly and was rent-seeking on me, but who’s doing that? I wouldn’t rule out the possibility that it’s rent-seeking all the way down, but you’d have to make that case. Suppose you say, doctors and pharma companies are rent-seeking, and I say…

Doctors in the US make almost twice of what doctors in other developed countries make.

If you're saying it's because they have to pay for med school... then maybe it's med school that's taking the bacon :P

https://journal.practicelink.com/vital-stats/physician-compe...

And, as rsj_hn, all the bizarre administrative overhead eats a lot of profits which are basically dissipated, it's economic wealth destruction.

Re: The US spends more on healthcare for no gain says new report from Johns Hopkins

#395

Earlier quoted context omitted.

It's not that it's more expensive at one place or another for the most part. When you go in-network you are seeing providers that your insurance has a contract with. This contract includes agreed amounts for procedures. Providers will often grossly overbill (mostly because it's easier to let the billing backend resolve these limits than bill accurately in the first place) and your insurance will respond with the amou…

I understand this, but don’t understand why millions of people are ok with the system. It has a lot more in common with a protection racket than with patient care in my view.

I don't think millions of people are okay with it. I think the vast majority are unaware, those who are aware have no agency, and very powerful interests seek to maintain the status quo.

Re: The US spends more on healthcare for no gain says new report from Johns Hopkins

#396

Earlier quoted context omitted.

It is partly a cultural thing - a kind of cult of narcissism. But those attitudes are carefully cultivated by the media. They don't just happen. Congress and the Senate are full of corrupt leeches, and both parties are equally guilty. Votes make no difference. Corporate money buys political careers, and it pays for both sides. There are a few exceptions, cultivated to maintain the appearance of representative democra…

> Congress and the Senate are full of corrupt leeches, and both parties are equally guilty. No, the Democrats and Republicans are not the same.

Both parties are equally guilty of being more worried about holding on to the reigns of power than serving the public.

Re: The US spends more on healthcare for no gain says new report from Johns Hopkins

#397

Earlier quoted context omitted.

> Free markets and regulations can co-exist. It doesn't have to be one or the other. Name one country on this or any other planet where this exists. Anywhere, except some bullshit theoretical textbook funded by a think-tank with obvious conflicts of interest. > BTW, hospitals in the US begin publishing their pricing data online this year. By law. More garbage. Those aren't real prices being published, they're approxi…

> Name one country on this or any other planet where this exists. With respect to healthcare? Switzerland, for example. Very similar to ACA, actually, with mandatory but private insurance, and significant premiums. Government spending as proportion of GDP is actually lower than in US! But they've got better price controls, and that makes all the difference. But, really, most countries are hybrid in that regard. It's…

Thanks! I'll research that more.

Re: The US spends more on healthcare for no gain says new report from Johns Hopkins

#398
post #348

Earlier quoted context omitted.

Free market and well functioning market are not synonyms. Healthcare economy is naturally inefficient if free. Information asymmetries and other market failures emerge without good regulation and mechanism design.

Every market has information asymmetry. Software is probably the biggest one today. Yet software keeps getting better and better... I agree there are needs for regulations--more like proper norms though and a good tort system.

No it doesn't. You can negotiate the price of software before you buy it, and you can shop around and choose between alternatives, or choose not to buy at all.

If you need a piece of rebar removed from your chest, then you need a piece of rebar removed from your chest. The price doesn't matter, the choice of provider doesn't matter. The "consumer" is completely at the whim of whatever provider happens to be closest. That's not how free markets are supposed to work.

Re: The US spends more on healthcare for no gain says new report from Johns Hopkins

#399
post #3

It's worth noting that the U.S. market does pay for the lion's share of patented drugs, effectively funding a significant portion of R&D that benefits the whole world years later when generics come into market (at least for those drugs which are not costly to manufacture, which happen to be the majority). I'm not saying this model is right. I'm just saying that doing away with it will have fundamental consequences to…

If this is in fact true it means the rest of the world is freeloading off the US system. Not saying I'm convinced it is true. I'd like to see a deeper unbiased analysis.

> If this is in fact true it means the rest of the world is freeloading off the US system.

It would be if the US system was in fact efficient and good. But it's not. It doesn't work for the people. It's a huge beast that is out of control and costs billions. It will happily "research" identical drugs, worse drugs or unnecessary drugs if it means it can milk patents for a few years longer.

As it currently stands, it's more accurate to say that drug research in the rest of the world is suffering because it's being dominated (because part of the billion dollar budgets go to marketing) by the US pharma industry, including everything that is broken about it.

If we were freeloading, wouldn't we just take the useful results of your research?? But we get the bullshit too, because yes, your pharma marketing budgets are so huge they do in fact reach overseas.

Re: The US spends more on healthcare for no gain says new report from Johns Hopkins

#400
post #384

Earlier quoted context omitted.

"there is no reason my money should pay for the care of others" Isn't the cultural issue largely a idealogical issue - things like the UK NHS are avowedly socialist? In the words of Aneurin Bevan, founder of the NHS: " A free health service is pure Socialism and as such it is opposed to the hedonism of capitalist society." https://en.wikipedia.org/wiki/Aneurin_Bevan Personally, at least when it comes to healthcare, I…

Kind of. As a Brit I don't think the UK is especially socialist. Also we don't generally think of the NHS as socialist more than Americans would talk about having a socialist army or police force. The fact that the above are funded by the government from tax in my view doesn't really make them socialist. It's more just a common sense way of funding some stuff. The dictionary has socialism as "means of production, dis…

Note that Bevan isn't saying that UK society is socialist (although he was probably in favour of it) - rather than the spirit of the NHS is socialist. Note that I would agree that it seems "common sense" for us in the UK and I'm definitely not keen on basing arguments on ideologies but it clearly doesn't seem "common sense" for people in the US.
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