ACA Subsidies ruled illegal

originally posted by: kaylaluv
a reply to: Krazysh0t

I don't like corporate lobbies, and I want more regulations. I want corporations out of government, and I don't want politicians in the corporations' pockets. I want politicians to make laws that are in the best interests of the people in general, and not what's best for their own personal interests. Free markets are over-rated IMO, and can be (and have been) manipulated by the greedy.

Is that still a contradiction?

So how do you know if the regulations are good, go to far, or too much? Government is pretty much the most inefficient institution ever created. The only thing it does well is wage war, cause hardship, and make the population suffer.

The balance of power between businesses and the people needs to be even. Right now it is tipped too heavily towards business, but your solution would tip it too heavily towards the people, and yes that is just as bad. With too many regulations and controls, you make it hard for businesses to conduct their business. It is harder for startups to be successful or even get off the ground. Prices rise to accommodate for the price of implementing new regulations. Eventually everything grinds to a halt and there is no economy left. The only way to truly have a good economy is to have the balance of power be equally between the people and business. The free market is the best way to go about this. Neither side is favored by the power of government backing it.

a reply to: Krazysh0t


I'm okay with free markets as long as corporations aren't allowed to manipulate them at the expense of consumers (which is exactly what's happening with big Pharma and the health insurance companies).

In Japan (and other free world countries), healthcare costs are highly regulated. Insurance companies are government-run, or are highly regulated. These countries apparently have figured out that given free reign, these companies will scam the people out of all their money, because people want to live and therefore are dependent on the healthcare industries.

originally posted by: kaylaluv
a reply to: NavyDoc

What about Canada and all the other 1st world countries where you can get it for $10 or less? Wonder how they manage it? What about the block on generic equivalents in the U.S.? No, I'm sure it has nothing to do with wanting to keep those profits at an abnormal high...

Medication subsidized by taxes, no R&D costs (they can come to market much earlier in Canada because they do not have the stringent and outdated regulations and approval process of our bureaucratic DEA), and you can't sue.

Those countries accept greater risk, less regulatory burden, less lawsuits, and a greater complication rate that the US. We could do the same but then you'd have to accept that you'd lose your ability to sue and if you did have a successful case, it wouldn't be the multimillion payouts that are common here. You would have to accept a greater risk of side effects. There is a reason we have no thalidomide babies in the US because that drug was taking a lot longer to be approved in the US and that process was stopped when we saw all of the birth defects in Canada. Had we had their same system, there would have been a lot of those birth defects here. You'd have to accept that there would not be a lot of new drugs on the market, the bulk of drug research is still done in the US. Not saying that there is none elsewhere, the UK has several decent drug companies who are doing research, but that the bulk is here.

Again--one cannot have our regulatory burden, QA oversight, time for research and approval, R&D costs, and litigation and still expect the meds here to be as cheap as the places where they do not have these issues. You want a lot of regulation? Well, that comes with a price.

originally posted by: kaylaluv
a reply to: Krazysh0t


I'm okay with free markets as long as corporations aren't allowed to manipulate them at the expense of consumers (which is exactly what's happening with big Pharma and the health insurance companies).

Big Pharma and the health insurance companies are manipulating the markets by lobbying the government. A free market is a market with ZERO government influence good or bad. This includes lobbying the government to get your way, subsidies to businesses to jump start industries, banning products such as hemp to allow over industries to continue to thrive, as well as regulations that tell a business how to operate.

Keep in mind that there is no such thing as a free market on this planet. Every market has government influence in it. The closest would be Hong Kong. By the way, they are doing just fine with their free market.

In Japan (and other free world countries), healthcare costs are highly regulated. Insurance companies are government-run, or are highly regulated. These countries apparently have figured out that given free reign, these companies will scam the people out of all their money, because people want to live and therefore are dependent on the healthcare industries.

Comparing our system to Japan or other 1st world countries is tough because other countries have different levels of government involvement in the market. Depending on what threshold the country allows the government to manipulate the markets depends on the direction the industry grows. I don't think that with the way we let government manipulate our markets that it is conducive to generating the same systems as a country such as Japan.

a reply to: Krazysh0t

Interesting you should mention Hong Kong, as they have an extensive public healthcare system that operates at little to no cost to the people (they have private insurance and healthcare for the very rich). Even they don't let the "free market" take over the healthcare of it's people. You don't need to regulate when you have a perfectly good public option that most of the population takes advantage of.

Fees for public healthcare services are very low. A visit to a public outpatient clinic will cost you about HKD 100, including emergency visits. In addition to this basic fee, you will be charged HKD 10 for any medication you might need. For staying in a regular ward at the public hospital, you pay around HKD 100 per day, plus an admission fee of HKD 50. Thus, you should not be in need of a private Hong Kong health insurance. For those residents who cannot afford even these moderate fees, the Hong Kong government provides a fee-waiving mechanism to make sure that nobody is excluded from the benefits of healthcare due to a lack of financial means. All of these public health services are also available for non-residents, for example, tourists.

www.internations.org...

originally posted by: NavyDoc
Again--one cannot have our regulatory burden, QA oversight, time for research and approval, R&D costs, and litigation and still expect the meds here to be as cheap as the places where they do not have these issues. You want a lot of regulation? Well, that comes with a price.

It does come at a price, but that price is nowhere near as high as you think it is. The average cost to develop a drug, get it into the market, and get doctors to prescribe it is $5 billion. The typical drug after all the tests are done has a patent life of 9 years, but lets shorten that and say it lasts for 5 years. To make a 100% return they need to sell 2 billion pills per year. That's 5,480 per day or 183 prescriptions per day. 183 prescriptions is not a lot, that's only 66,795 cases per year and we're talking just in the US. Most illnesses are diagnosed at a rate above 66,795 per year (and if they made margins closer to other businesses such as 10% it would only be 36,737 cases per year). If the drug company gets to patent their drug in other countries they can make more money or more easily hit that threshold. Oh, and that math? That's at $1 per pill.

The biggest reason we pay so much is that high population countries like China and India ignore out patent laws, copy our drug formulas, and then sell generics in their own countries and anywhere else they can. It puts the US in a situation where just our population has to pay for the development of drugs for use all over the world.

There's nothing wrong with our testing procedures, there's everything wrong with the fact that we let other countries steal our work.

Wow, I should not post when I'm tired, maybe someday I'll learn. Sorry, the above numbers are... off. I can't go back and edit now.

The rest of the point stands however. We pay higher prices because countries like China and India steal the drug patents and produce low cost generics for their citizens, the profit from which does not flow back to the company that actually developed the drug. Even countries like England, Canada, and Mexico get in on it but with lower populations they don't have as big of an impact. If our drugs were selling in those countries, the price per pill for everyone would be reduced. As it is we're subsidizing their healthcare.

I'll try again with proper numbers. It costs 5 billion to produce a drug according to this . The profit margin averages to about 12.2% according to this. Thus a drug that costs $5 billion needs to generate 5.61 billion in revenue. The typical drug patent is good for 11 years of on the shelf sales according to this. So the drug needs to generate $510 million in revenue per year. That means that $1,397,260 needs to be earned in sales per day. If the typical drug treats an illness with lets say 31,000 people suffering per year (1 in 10,000 in the US) that means each pill needs to cost $45.08 in order to hit the goal.

The ways to lower that price are to either expand the market by selling in other countries. We currently do this, but different countries have different rules on generics and it's not a true 1:1 return. Because the drug company is competing with generics nearly from day 1 they only get back a small part of the cost. If a pill costs $3 to produce and sells for $45 in the US but only $5 in another country they need to sell 22 pills to make up the money that just 1 pill sells for in the US. Overall this means that we don't get to lower drug costs much through a global market unless other countries accept our patents and are willing to lower the quality of life for their citizens.

The other way to lower the price is to subsidize the research. If a drug costs $5 billion to produce but the taxpayers pay 2.5 billion of that, the cost of the drug will be 50% lower when it's sold. The problem here is that everyone gets upset at paying for other peoples illnesses, it corrupts the free market, and eventually puts the government in total control of the development of medicines. Plus, free money has the effect of just increasing prices in the long term (look at what free money for housing did to the housing market or what free education is currently doing to college).

a reply to: Libertygal

The whole mess is illegal, of course. It's beyond bad when a portion at a time has to be called "illegal" and struck down, instead of the whole thing at once.