Effects of Reducing The US's expenditure on Medicine

[CaptainGoodnight]

Also, note that much of that revenue does not go towards medical research but rather is wasted on inefficiency--insurance companies, medical billing specialists, insurance brokers, company benefits plans managers--people and jobs that just push paper and have nothing to do with the actual provision of health care.

I think you just lumping the insurance industry and the medical research industry into one group.

Or maybe I am confused. I can see money being wasted because of FDA regulations and such. How does money spend on medical research work it's way into the healthcare system?

For example, the NIH grants money to some university to some research. They spend it on personal, equipment, etc. How does the inefficiency of the healthcare waste that money. I would be interested to know, because I really don't have extensive knowledge of that research money gets distributed and spent.

 

[shira]

Two of the largest causes of increased spending in the U.S. compared with other countries are the aggressive treatment of poor-prognosis cancers and the cost of end-of-life care.

For example, if there's only so much money available, should we spend (say) $500,000 aggressively treating a stage-IV breast cancer (that has only a 20% 5-year survival rate) if the person has insurance, OR should we instead spend that same money treating several uninsured individuals with stage IIB breast cancer (which has an 81% survival rate)? I'm pretty sure that our current system spends the money on the insured person (who probably dies anyway) and leaves the uninsured untreated (who then progress to later-stage cancers that kill them, too).

Unfortunately, it's these types of trade-offs that really do amount to "death panels." Shifting expenditures to areas where's there's the greatest bang for the buck would overall improve health in the U.S. But grandma - who PROBABLY would have died anyway, but only after the system fought the good fight on her behalf - will ALMOST CERTAINLY die without any pretext of the system trying to save her.

 

[Darwin333]

So you're saying you should pay France more?

Oh, and while MRI's are so cool that everyone just NEEEEEEEDS one at every appointment, ultrasound is usually a better option for most things.

I didn't say or imply anything of the sort. I simply asked a question because I am ignorant on the subject.

I apologize if I didn't add in the normal partisan bullshit that these debates normally degrade into. If that is what you are looking for I am sure you will find plenty of posts to entertain yourself with in this thread if you are a bit more patient.

 

[WhipperSnapper]

I think you just lumping the insurance industry and the medical research industry into one group.

The OP was talking about our total medical expenditures--the 17% of GDP.

Or maybe I am confused. I can see money being wasted because of FDA regulations and such. How does money spend on medical research work it's way into the healthcare system?
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For example, the NIH grants money to some university to some research. They spend it on personal, equipment, etc. How does the inefficiency of the healthcare waste that money. I would be interested to know, because I really don't have extensive knowledge of that research money gets distributed and spent.

I think you are a little confused. I suggest that you go back and read the original post. The issue is whether or not our spending more money on pharmaceuticals than other nations effectively subsidizes medical research for the rest of the world. The pharmaceutical companies use a portion of their revenue to fund drug development. The issue in this thread has nothing to do with NIH grants, at least not directly.

 

[werepossum]

It's a legitimate question. The only proper answer is, "If it turns out that we have been subsidizing other nations at our expense, then they'll need to pitch in and help support the costs of medical and pharmaceutical research." Why should we Americans suffer with an inferior system for the benefit of people in other countries?

Also, note that much of that revenue does not go towards medical research but rather is wasted on inefficiency--insurance companies, medical billing specialists, insurance brokers, company benefits plans managers--people and jobs that just push paper and have nothing to do with the actual provision of health care.

Those are good points. I think the first question is a bit skewed, as it is largely US companies using US consumers to subsidize research. These companies sell drugs much more cheaply in other countries, but they still sell at a profit vis-a-vis manufacturing and distributing costs or they would sell. When the US system goes socialist this foreign advantage may disappear, or the government may just as easily decide that we have a moral obligation to sell life-saving drugs to other countries for less money than we charge ourselves.

Also, please note that the inefficiencies you quote don't go away even with a single payer system. Someone still has to do all that paperwork or else there is massive fraud in the system; people can't just say "I'm a doctor and I saw a hundred patients today, you owe me X amount of money." These are the very tasks that government often contracts out to private firms because they can do them so much more efficiently.

 

[sandorski]

Those are good points. I think the first question is a bit skewed, as it is largely US companies using US consumers to subsidize research. These companies sell drugs much more cheaply in other countries, but they still sell at a profit vis-a-vis manufacturing and distributing costs or they would sell. When the US system goes socialist this foreign advantage may disappear, or the government may just as easily decide that we have a moral obligation to sell life-saving drugs to other countries for less money than we charge ourselves.

Also, please note that the inefficiencies you quote don't go away even with a single payer system. Someone still has to do all that paperwork or else there is massive fraud in the system; people can't just say "I'm a doctor and I saw a hundred patients today, you owe me X amount of money." These are the very tasks that government often contracts out to private firms because they can do them so much more efficiently.

The amount of Paper Work in the US system dwarfs the Paper Work in other systems.

 

[werepossum]

The amount of Paper Work in the US system dwarfs the Paper Work in other systems.

And your source would be?

Personally I'm on a health savings account with a large deductible conventional policy above it. If I need health care, my provider tells me how much I owe (on rates negotiated by BCBS, although I'm free to negotiate a lower rate if desired) and I pay it, using pre-tax dollars. The provider then sends a copy electronically to BCBS. Hard to get less paperwork than that.

 

[sandorski]

And your source would be?

Personally I'm on a health savings account with a large deductible conventional policy above it. If I need health care, my provider tells me how much I owe (on rates negotiated by BCBS, although I'm free to negotiate a lower rate if desired) and I pay it, using pre-tax dollars. The provider then sends a copy electronically to BCBS. Hard to get less paperwork than that.

There's a ton of Documentaries and other Sources. When you only have 1 Payor or very few, your Paper Work is drastically reduced.

 

[glenn1]

Those are good points. I think the first question is a bit skewed, as it is largely US companies using US consumers to subsidize research. These companies sell drugs much more cheaply in other countries, but they still sell at a profit vis-a-vis manufacturing and distributing costs or they would sell. When the US system goes socialist this foreign advantage may disappear, or the government may just as easily decide that we have a moral obligation to sell life-saving drugs to other countries for less money than we charge ourselves.

Also, please note that the inefficiencies you quote don't go away even with a single payer system. Someone still has to do all that paperwork or else there is massive fraud in the system; people can't just say "I'm a doctor and I saw a hundred patients today, you owe me X amount of money." These are the very tasks that government often contracts out to private firms because they can do them so much more efficiently.

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If the United States placed caps on drug costs like other countries, a great deal of the medical research currently performed would dry up. The U.S. market is essentially playing the same role as "early adopters" do in technology - willing to pay premium costs for the latest greatest and making the costs of research worthwhile. Once the research has been done and the drug being manufactured, the marginal costs to produce more units is almost nothing, so therefore there is no great loss in selling a few extra to other countries for lower rates than the U.S., so long as someone is paying the price premium for it.

If the U.S. adopted price controls as well though, the entire system would collapse. It's basically a Prisoners' Dilemma situation - a country could gain an advantage by imposing drug price controls, but if they all do then none will get a benefit and indeed be worse off.
If no country or market is willing to play the role of "early adopter", then there is no point for the drug company to produce a drug that won't recover their costs since price-controlled markets essentially turn a new drug into a commodity priced good. It's only in a non-price controlled market that companies will bother to engage in R&D - why would you spend billions to produce a drug if universal price controls meant you couldn't recover your costs and make a profit?

So go ahead and advocate for price controls in the U.S. but just be aware that you are essentially trading any hope of new miracle drugs in the future for getting cheaper today the drugs of the past.