Primula Baggins wrote:Voronwë, of course changes to entitlements are needed. I just think they can be made intelligently and don't have to begin with squeezing the beneficiaries. For example, let Medicare beneficiaries buy drugs from outside the U.S. Raise the salary cap on Social Security by a moderate amount. Plug holes in the system. Then assess and decide what else needs to change.
Since this is vaguely health care-ish ...
Drugs cost more in the U.S. than in other countries. Fact.
So, why?
There's a couple of broad brush categories that the answers will probably fall into:
a) The drug manufacturers are fleecing ordinary people who need these drugs in order to maximize profit for themselves.
b) A cumulation of various idiosyncrasies in the U.S's treatment of pharmaceutical drugs add up to a big part of the cost. Some candidates that have been suggested in the past:
- The U.S consumer tends to be an early adopter of new drugs. Since drug manufacturers have to recoup R&D costs and make profit during the period drugs are patent-protected, this tend to make drugs more expensive here. On the positive side, this means that U.S citizens and residents get the best, cutting-edge drugs sooner. On the negative side, you have to pay for that privilege.
- The U.S, being a wealthy country [ Yes. The U.S is still a wealthy country compared with the rest of the world, even after the 2008 economic collapse. ], has citizens that can afford higher prices more readily than the rest of the world. So U.S citizens end up subsidizing poorer countries whose citizens also need these drugs, but who simply can't afford U.S prices. The drug companies do not deny them access to the drugs, they just sell the drugs at a lower price and a slimmer profit, and make up their desired profit margin in the U.S.
- The pharmaceutical industry advertises
heavily in the U.S. All that advertising costs have to be recouped from the local market. Hence, more expensive drugs.
- Regulations. The U.S drug market is said to be heavily regulated, which protects the health of consumers, but also adds to the cost of drugs.
- Brick and mortar pharmacies. A pharmacist degree takes 8 years and a pharmacist typically makes six figures. Add in pharmacy technicians and so on, and it does add a little to the cost of the drugs. On the other hand, you also get better quality care.
- Medicare typically negotiates lower prices for their patients' drugs. The cost savings for Medicare is then passed on to the other consumers.
I am just a layman trying to get a picture of what is happening by reading different opinions in this area, so I can't say which of these broad schools of thought holds more truth.
But, if we take the suggestion to allow Medicare patients to purchase their drugs back from those other countries that are subsidized by U.S drug buyers and free of paying for the direct to consumer advertising, it seems like it will just introduce another inefficiency in the system. Now those patients have to pay for shipping back to the U.S and you've wasted resources exporting and re-importing something. That's silly. Medicare patients are already subsidized a little bit by the general population because Medicare tends to negotiate lower prices. Maybe that should instead be taken further by saying Medicare patients get to pay cost, or maybe cost plus one or two percent, for drugs, and the subsidizing part gets passed on to the general population, making drugs more expensive for anyone not on Medicare? Or maybe that won't be a fair way to deal with this aspect of raising health care costs?
Perhaps some consideration can be given to banning direct to consumer advertising. Studies suggest that this is expensive yet has a negligible effect on increasing use of drugs. You don't take drugs you don't need, and your doctor has to prescribe them first, kind of a thing. This would be cost savings for many more users of pharmaceutical drugs. It will put some advertising agencies and marketing departments out a job, but, well, someone's gotta pay. There's a sort-of precedent for this with cigarette advertising.
Maybe drug companies should be prevented from taking profits above a certain threshold. I have no idea whether this can be enforced or not.
I tend to think that a problem with this many entangled components to it will need an overall solution, not a solution focused on a single area. And to be honest, while I understand the premise behind Social Security to some extent, I'm still sort of fuzzy on the what and why of Medicare. So I will need to do my homework on that first before I can speak at all to whether changes to the program would make sense in my opinion.
But maybe they'll learn from that, too—maybe next time (in a few months), they won't surrender quite all their ground before the negotiations even start.
