Universal Healthcare and Research and Development

[Wildy]

I know that we have been through this before, but this does deserve its own thread. I'm putting it here, but it might be more suited to the Business section, so mods, please move it if you see fit.

You see people who do not support the concept of universal healthcare argue that implementing such a system in the US would lower research and development of new drugs/methods/etc.

What exactly is the basis for this argument?

Is this really something that is based on the idea that a healthcare system with far greater government involvement will lower the profits of the R&D companies so they will be less inclined to find new ways of doing things?

And if you were selling vast quantities of medicines to the government then wouldn't it make you more inclined to research because by finding and getting new and more effective drugs onto the market the governments would be more likely to purchase your product?

Or have I got it all wrong?

 

[Jaggy Bunnet]

I know that we have been through this before, but this does deserve its own thread. I'm putting it here, but it might be more suited to the Business section, so mods, please move it if you see fit.

You see people who do not support the concept of universal healthcare argue that implementing such a system in the US would lower research and development of new drugs/methods/etc.

What exactly is the basis for this argument?

That a taxpayer funded system would be cash limited and would tend to reject certain treatments purely on the grounds of cost? This certainly happens in all parts of the UK under the National Health Service.

Is this really something that is based on the idea that a healthcare system with far greater government involvement will lower the profits of the R&D companies so they will be less inclined to find new ways of doing things?

If you lower the potential profit, what do you expect that to do to the incentive to invest in finding new drugs?

And if you were selling vast quantities of medicines to the government then wouldn't it make you more inclined to research because by finding and getting new and more effective drugs onto the market the governments would be more likely to purchase your product?

Not if they may refuse to buy your drug, even though it is the most effective treatment available, because they do not have the budget for it.

http://news.bbc.co.uk/1/hi/health/7362989.stm

http://news.bbc.co.uk/1/hi/england/devon/7250141.stm

http://news.bbc.co.uk/1/hi/scotland/6284532.stm

 

[fls]

What's to prevent individuals from purchasing effective new drugs, even if a single-payer was not interested in doing so? Isn't that what happens in the U.S. now?

Linda

 

[Oliver]

I'm not sure how UHC could lower research and developement in the US unless the US is considering to take over the free pharmaceutical market.

The counterquestion would be: How in the world are ALL the other western democracies doing it? How did Germany research and develope new drugs, methods etc. within the last 130 years?

As far I remember, Frontline also looked into the question of research and developement:

PBS FRONTLINE: Sick Around The World

 

[JoeEllison]

Basically, it is a foolish lie, designed to trick the sort of people who are really incapable of thinking rationally on any subject tied to politics.

 

[Jaggy Bunnet]

What's to prevent individuals from purchasing effective new drugs, even if a single-payer was not interested in doing so? Isn't that what happens in the U.S. now?

Linda

Two factors, one economic (they have less cash available to allocate as they choose as they are paying taxes to fund universal health care) and one psychological (they have already paid for healthcare via taxes, so won't be inclined to pay again directly).

 

[fls]

Two factors, one economic (they have less cash available to allocate as they choose as they are paying taxes to fund universal health care)

That doesn't sound right. Individuals in the US pay more than everyone else for healthcare - they pay more in taxes and they pay more out-of-pocket. Going to a universal health care system suggests they'd pay less over all, giving them more cash available for buying effective new drugs.

and one psychological (they have already paid for healthcare via taxes, so won't be inclined to pay again directly).

I thought that was the point of competition - make a better product and people will think it's worth the extra money.

Linda

 

[Jaggy Bunnet]

That doesn't sound right. Individuals in the US pay more than everyone else for healthcare - they pay more in taxes and they pay more out-of-pocket. Going to a universal health care system suggests they'd pay less over all, giving them more cash available for buying effective new drugs.

Do you have a source for these? I am surprised about the tax element.

I thought that was the point of competition - make a better product and people will think it's worth the extra money.

Current product cost £8,000, fully paid for by National Health Service.
New product cost £10,000, nil paid for by NHS.

Individuals might well think it is worth the extra £2k, but not the extra £10k which is the difference it would cost them to switch.

 

[Architect]

Well, the NHS does restrict access to some drugs on a cost/benefit calculation which is open to debate - bear in mind that NHS Scotland makes available certain drugs our cousins south of the border don't have access to - however my understanding is that, in the US, insurance companies have approved treatment regimes and hence labour under similar restrictions. Perhaps our US posters can comment about that.

Notwithstanding any such similarity, however, I note that the drugs under debate are very much at the fringes of healthcare and there are no restrictions on nearly all of the other prescribed treatments.

Turning to whether the US system costs more, Rolfe and others did some fairly comprehensive analysis of that on another thread and I don't think anyone refuted the suggestion that the combination of Medicare and PHI cost US citizens significantly more than the UK or other EU universal health systems.

On a final note, the US does provide massive funds for drugs research IIRC however since companies such as Roche and Glaxo don't receive such funds (what with being dangerous foreigners) and are still at the forefront of research then there's a risk of a spurious correlation which might slew the debate. Proper research would be required before drawing any conclusion.

 

[fls]

Do you have a source for these? I am surprised about the tax element.

http://www.commonwealthfund.org/usr...hltsysdata2006_chartbook_972.pdf?section=4039

Table II-7.

Current product cost £8,000, fully paid for by National Health Service.
New product cost £10,000, nil paid for by NHS.

Individuals might well think it is worth the extra £2k, but not the extra £10k which is the difference it would cost them to switch.

How is this different in the US when an insurance company refuses to cover the costs of a treatment?

Linda

 

[ponderingturtle]

How is this different in the US when an insurance company refuses to cover the costs of a treatment?

Linda

Because getting a treatment refused by a private bureaucrat who is trying to save money for the company is better than a public bureaucrat who is trying to save money for the government.

 

[Architect]

I hope you're being sarcastic/humorous/ironic or somesuch.

 

[JoeEllison]

Because getting a treatment refused by a private bureaucrat who is trying to save money for the company is better than a public bureaucrat who is trying to save money for the government.

Yes, because if some millionaire makes an extra fraction of a percent of profit, that benefit outweighs the death of some sick person who couldn't pay cash for life-saving treatment. If no one makes an obscene profit, then even if the system refuses fewer treatments, it is still inherently evil.

 

[balrog666]

What's to prevent individuals from purchasing effective new drugs, even if a single-payer was not interested in doing so? Isn't that what happens in the U.S. now?

Linda

Not only no, but Hell no!

Prescription drugs require a prescription, which requires a doctor's approval, which is extremely unlikely if the drug is not on the "allowed" list or FDA approved.

And the cost to research and get a new medication approved is several hundred million dollars. So, you better have one hell of a market to sell into or some guarantee of a continuing market before you invest the money in the first place.

 

[fls]

Not only no, but Hell no!

Prescription drugs require a prescription, which requires a doctor's approval, which is extremely unlikely if the drug is not on the "allowed" list or FDA approved.

We are not talking about FDA approval; that is something different.

You are incorrect about whether or not a doctor will write a prescription for a drug not on the 'allowed' list. If the doctor thinks it's the best choice and the patient indicates they are willing to pay, the prescription will be written. The actual target of the marketing will be the doctors first, patients second.

And the cost to research and get a new medication approved is several hundred million dollars. So, you better have one hell of a market to sell into or some guarantee of a continuing market before you invest the money in the first place.

Why do you think pharmaceutical companies' marketing budget outstrips their R&D budget?

I appreciate the concerns demonstrated by the links provided earlier. However, the normal course of events for these expensive drugs that are truly useful (rather than just over-hyped) seems to be that once a reasonable amount of evidence accumulates and the issue is made public, they make their way onto the lists. It could improve the quality of R&D, as the incentive will be to develop novel treatments, rather than me-too drugs.

Linda

 

[Ivor the Engineer]

I only have new ideas if someone pays me.

I only read books and learn new skills so I can earn more money.

There is no point doing anything that helps everyone unless there is a financial reward as well.

 

[CaptainManacles]

How is this different in the US when an insurance company refuses to cover the costs of a treatment?

You can choose which insurence company you want to have. A cheaper one that will do less or an expensive one that will do more. I don't see why I would want 51% of the population telling me how I should spend my money on health, or if I want to spend it, and why they should be able to force me to spend it on people I don't want to spend it on.

 

[Bob Blaylock]

Because getting a treatment refused by a private bureaucrat who is trying to save money for the company is better than a public bureaucrat who is trying to save money for the government.

More to the point, if you don't like how one health insurance company is treating you; and if you think you can get a better deal from a different company; then in a free market, you are free to take your business elsewhere. As inefficient and as otherwise bad as health insurance companies may be, they do have to compete with one another to get your business, so they are subject to normal market forces that compel them to offer some level of value for the money that you pay into them.

Under a government-based socialist health care system, you have no such freedom. You pay what Big Brother tells you to pay in taxes, and you accept whatever service Big Brother chooses to give.

It is my opinion that the biggest problem with the health care industry as it currently exists in the United States is that the participation of insurance companies creates a sort of a quasi-socialist environment, that tends to insulate consumers and health care providers from normal market forces. Patients aren't sufficiently compelled to seek the best value in their health care treatment, because they take it for granted that whatever their treatment costs, their insurance will cover it. Health care providers aren't as compelled as they should be to keep their costs in check, for the same reason.

Replacing this with a true socialist system, in which all remaining market-force-related constraints are eliminated, can only make it worse, not better.

Look what government has done to our educational system. If you are wealthy enough, you can still send your kids to a private school, which will provide a better quality of education, at a lower cost per student, than government-provided education does; but you still have to pay the same taxes to support the inferior government-based education that you aren't even using, on top of the tuition to the private school. Do you really want to let this happen to the health care industry as well?

 

[Demigorgon]

I imagine government run health care would be much like going to the DMV. And I cannot think of a single program that the government runs efficeintly and cost effectivley.

 

[CaptainManacles]

Notwithstanding any such similarity, however, I note that the drugs under debate are very much at the fringes of healthcare and there are no restrictions on nearly all of the other prescribed treatments.

But if I have the money to pay for a treatment, and I understand the risks, and it's not terribly dangerous and ineffective, why should I have to debate with anyone? More to the point, why would I want a system where I have to pay for whatever treatment the goverment decides are valid, such as homopathic drugs?