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COMMENTARY |Our worst national problem is probably the unsustainable growth in the cost of health care. My suggestion is to reduce drug costs without price control. Other advanced countries provide equivalent or better health care for less than one-half the cost.
The principles of the free enterprise system-- charging the maximum price the market will allow to deliver the highest possible profit-- are not compatible with the welfare of the medical patients. Patients will pay almost any price to live longer. When a person is dying or is in immense pain, worldly goods lose their importance. The fact that most of the medical bills are paid by insurance companies or the government reduces concern for the cost even further. The medical industry exploits this advantage to reap enormous profits. The drug industry is a prime mover of the cost.
According to a New York Times op-ed, some advanced cancer drugs cost twice the price of older drugs, but they offer no better results. The FDA approves new drugs as being safe and effective. They do not consider price. New cancer drugs typically cost about $10,000 monthly. Two of the newest cancer drugs cost $35,000 monthly.
Medicare is required by law to pay for most cancer drugs that receive FDA approval. This provides little incentive for drug companies to show pricing constraint. If innovative advertising can be used to convince doctors to use the new drugs, inflated prices would enable a new drug to be profitable at very modest sales levels.
Proponents call this free enterprise, but the normal market forces are being grossly distorted by Medicare being required to pay for most cancer drugs, no matter how expensive. Most advanced countries regulate drug prices.
Within our capitalistic system, this would be intolerable.
At the very least, the law should be changed to require Medicare, Medicaid and insurance companies to pay only for the lowest-priced versions of a cancer drug that are equally as effective as the higher-priced one. Drug companies are willing to sell their drugs in other countries, even though regulation results in much lower prices. U.S. citizens are, in effect, subsidizing lower drug prices for the rest of the world.
Health care cost escalation is on a collision course with our other national needs. Ways must be found to maintain a strong health care system that we can afford while protecting the health of the nation.
- Pharmaceuticals & Drug Trials
- health care