Healthcare comparison - a case study

[Phil1111 910]

2 hours ago, gowlerk said:

Huh? You think that Americans allowing themselves to overpay insurance and drug companies compared to elsewhere is a subsidy? Really, or am I missing something else?

The overpayment of drug and medical device R&D goes right to the overall bottom line of those companies. That allows Canada, Australia, India, EU etc. to negotiate lower prices for those same products. The big drug companies may have head offices in Ireland, Switzerland, etc. But the US is still the leader in leading new drug R&D along with medical devices.

I personally find the stories of Americans traveling to Canada to buy insulin offensive. Most are not well off, most are elderly and it borders on criminal.It reflects poorly on America. I welcome them and IMO there should be drive through pharmacies on the US border with bus sized capacity.

Skyrocketing cost of insulin pushes Americans to buy drug in Canada

 

[wmw999 2,120]

53 minutes ago, BIGUN said:

I do not. I; like Jerry am quite satisfied with my health care. But, when others start talking about taxing everyone without a plan in place - that causes me concern. The Canadian model causes me concern - see attachment.  

price-of-public-health-care-insurance-2018.pdf 586.53 kB · 1 download

I’m mostly satisfied with my healthcare. But I don’t think that’s enough; I have enough food, but I still volunteer at and donate to the food pantry, and emphatically support a local incentive that reduces the price of locally-grown fresh veggies from the farmers market if it’s paid for with SNAP coupons. Because while it costs me money, it helps both to improve nutrition and support the local farmers who appreciate the customers for their goods. 

Saying that ER care is OK is like saying that prison is a good alternative to homelessness. They’re roughly the most expensive possible way to address the issues. Yeah, we don’t see it as a line item on our taxes, but that doesn’t mean we’re not paying for them. I’d rather my “free stuff” tax dollars go to more cost effective solutions, even if those aren’t punitive of what I consider to be bad decisions. 

Wendy P. 

[Phil1111 910]

1 hour ago, BIGUN said:

I do not. I; like Jerry am quite satisfied with my health care. But, when others start talking about taxing everyone without a plan in place - that causes me concern. The Canadian model causes me concern - see attachment.  

price-of-public-health-care-insurance-2018.pdf 586.53 kB · 2 downloads

Sir:

7 Disturbing Facts About the Fraser Institute

"The Institute has received donations of hundreds of thousands of dollars[15] from foundations controlled by Charles and David Koch, with total donations estimated to be approximately $765,000 from 2006 to 2016.[16] It also received US$120,000 from ExxonMobil in the 2003 to 2004 fiscal period.[17] In 2016, it received a $5 million donation from Peter Munk, a Canadian businessman.[18]

In 2012, the Vancouver Observer reported that the Fraser Institute had "received over $4.3 million in the last decade from eight major American foundations including the most powerful players in oil and pharmaceuticals". According to the article, "The Fraser Institute received $1.7 million from 'sources outside Canada' in one year alone, according to the group's 2010 Canada Revenue Agency (CRA) return. Fraser Institute President Niels Veldhuis told The Vancouver Observer that the Fraser Institute does accept foreign funding, but he declined to comment on any specific donors or details about the donations."[1

Fraser Institute’s wait times survey is garbage science

When initiating an understanding of a broad international area of study. Its useful to use studies that don't have a horse in the race. Understanding heath care costs are easiest to understand using GDP per capital on an equal dollar basis.

This is where I would start: "Health spending

... This indicator is presented as a total and by type of financing (“Government/compulsory”, “Voluntary”, “Out-of-pocket”) and is measured as a share of GDP, as a share of total health spending and in USD per capita (using economy-wide PPPs)."PPPs are the rates of currency conversion that equalize the purchasing power of different currencies by eliminating the differences in price levels between countries.

The very first chart in the link above factors for all variables between all countries and factors all purchasing varables. Think the worldwide "Big Mac" ppp comparison.

Edited March 6, 2020 by Phil1111

[gowlerk 1,910]

1 hour ago, Phil1111 said:

The overpayment of drug and medical device R&D goes right to the overall bottom line of those companies. That allows Canada, Australia, India, EU etc. to negotiate lower prices for those same products. The big drug companies may have head offices in Ireland, Switzerland, etc. But the US is still the leader in leading new drug R&D along with medical devices.

I personally find the stories of Americans traveling to Canada to buy insulin offensive. Most are not well off, most are elderly and it borders on criminal.It reflects poorly on America. I welcome them and IMO there should be drive through pharmacies on the US border with bus sized capacity.

Skyrocketing cost of insulin pushes Americans to buy drug in Canada

 

I’m not buying that. The R&D would still happen without the obscene executive pay and shareholder profits. They only exist because of the nearly equally obscene payments made to politicians. The American healthcare  system is seriously distorted by legalized corruption. The rest of the world is closer to normal.

Without this share prices would fall, but shareholders would still do well, just on a smaller investment.

Edited March 6, 2020 by gowlerk

[Phil1111 910]

2 minutes ago, gowlerk said:

I’m not buying that. The R&D would still happen without the obscene executive pay and shareholder profits. They only exist because of the nearly equally obscene payments made to politicians. The American healthcare  system is seriously distorted by legalized corruption. The rest of the world is closer to normal.

Sir: you're missing the point. Of course the R& D would still happen. The industry uses the argument that  "obscene profits" are necessary to maintain a US "advantage" in medical/drug innovation. When they lobby in Washington.

They have established an advantage because of a general advantage of qualified US education and researchers. Together with the US advantage in equity markets that gave rise to many of the top drug/medical companies in the world. China is starting to chip away at that advantage due to a effort by China’s pharmaceuticals industry is growing up

U.S. policymakers worry about China 'weaponizing' drug exports

Biotech is high on China’s list of future markets to dominate in their Made in China 2025 policy. Washington is clearly worried.

As for Obscene Profits well:

" The average return on equity for key industries from 2014 – 2016 shows that biopharma’s profits stand at 16.2%, significantly lower than Computer Sciences (31.6%), Beverages (27.4%), Aerospace/Defense (23.0%), and Trucking (19.1%) while modestly higher than Software System/Applications (15.2%) and Healthcare Support Services (14.4%). ...

Internal Rate of Return (IRR) is even more telling. IRR calculates the sales/cash flows resulting from R&D investments, ties R&D and the returns it generates together, and is a more appropriate metric for biopharma productivity. Deloitte reports that the IRR for biopharma R&D has been steadily falling from 10.1% in 2010 to 3.2% in 2017. Even Wall Street hasn’t bought into the “pharma soaring profits” view. Since February 1, 2014, while the Dow has risen 63%, the stock prices of a number of major pharma companies have been muted with Pfizer and Bristol-Myers each growing by about 15%, and Merck and AstraZeneca by roughly 6.5%. Even Lilly’s growth of 43% still lags the Dow. "

Perhaps the net ROI for shareholders would be higher in the absence of $$$ spent on lobbying, defending IP theft, etc.

[Coreece 190]

Damn, thanks for all the info Phil.  Much appreciated!

[gowlerk 1,910]

55 minutes ago, Phil1111 said:

Sir: you're missing the point. Of course the R& D would still happen. The industry uses the argument that  "obscene profits" are necessary to maintain a US "advantage" in medical/drug innovation. When they lobby in Washington.

 

Hmmmm...... I’m not sure what point I’m missing. But the point I’m making is that America’s wastefulness is not a world subsidy.

[BIGUN 1,053]

2 hours ago, Phil1111 said:

This is where I would start: "Health spending

... This indicator is presented as a total and by type of financing (“Government/compulsory”, “Voluntary”, “Out-of-pocket”) and is measured as a share of GDP, as a share of total health spending and in USD per capita (using economy-wide PPPs)."PPPs are the rates of currency conversion that equalize the purchasing power of different currencies by eliminating the differences in price levels between countries.

The very first chart in the link above factors for all variables between all countries and factors all purchasing varables. Think the worldwide "Big Mac" ppp comparison.

Phil - this is good. Let me look it over a bit, please. 

[Phil1111 910]

41 minutes ago, Coreece said:

Damn, thanks for all the info Phil.  Much appreciated!

You're welcome. In the one article I quoted the short time frame "2014 – 2016" would lead most to question the accuracy of the data. But most Pharma companies have had middle of the road returns for the last decade. Ripoff prices suggest  gowlerk's most commonly held beliefs that they're earning out-sized returns. But that would normally result in investors pouring into those stocks.

So I dig further and Returns on different types of investment in the global pharmaceutical industry Which studies pharma in the US, EU and the rest of the world (ROW) from 1987-2012 the summary at the end is most illustrative of the industry.

"Comparing pharmaceutical companies to other companies shows that they have return–cost ratios—measured by qms—which exceed those of the nonpharmaceutical companies only in the United States and in the first half of the 1987–2012 period under investigation. In Europe and the RoW, we do not find significant differences between pharmaceutical companies and other manufacturing companies. The estimated returns on capital expenditures and R&D investments of pharmaceutical companies are higher compared with some other manufacturing industries, indicating that companies in the pharmaceutical industry seem to have some comparative advantage in investing in R&D. We also find evidence that some other industries have higher return–cost ratios than the pharmaceutical industry. The relatively high return–cost ratios suggest that the average company in the pharmaceutical and nonpharmaceutical industries was subject to underinvestment problems and that it could generate higher shareholder value by channeling greater funds to investment.

Our estimates of returns on total investment by pharmaceutical companies indicate that pharmaceutical investments create value for shareholders, which is not the case for all industries. As we do not observe overinvestment in the pharmaceutical industry, the results call for a regulatory regime that stimulates further investments.... Another interesting finding is that the returns on investment of pharmaceutical investment decreased over time. This drop is especially pronounced for European firms. ..

A second explanation refers to regulatory changes in many countries ranging from Australia to Europe that increased costs and lowered prices (Hailey, 2009). This potential explanation is also consistent with prior work on European companies suggesting that regulatory changes since the mid‐1990s have resulted in lower revenues compared with the United States and thereby impeded incentives for pharmaceutical R&D (Lakdawalla et al., 2009; Sood, de Vries, Gutierrez, Lakdawalla, & Goldman, 2009), which by some estimates amount to $4.96 billion"

This study unfortunately doesn't include. "hi-tech", internet commerce and some of the other areas that have generated outsized returns lately.

 

[yobnoc 142]

12 hours ago, BIGUN said:

I'm not the one who's calling for a change and you didn't offer a plan - you offered an opening statement, "decrease our defense spending (fraud, waste, and abuse), and increase taxes (offset by having no out-of-pocket expense for healthcare)."

Decrease our defense spending - Even if you eradicated the entire military (800B/year) you'd still have 2.2 Trillion to come up with . . .

Increase taxes - 2.2 T = >$6,000 for every man, woman & child in the US. So a family of four's tax bill would be ~$24,000/year

To meet your objectives; we would eliminate the military and just shove the middle class into poverty. You're missing the obvious. The entire tax structure would need to be changed. Thanks for playing. 

Your underlying assumption is wrong out of the gate.  Yes, healthcare in the US cost US citizens $3.5T in 2018, but $1T of that is revenue that goes directly to private insurance.  Take that out of the mix, cover everyone, and hospitals won't have to charge $1000 for an IV, or $1850/night for a room, or $226 for a suture kit.  What you're forgetting or willfully ignoring is that those with insurance are already subsidizing those without.  The hospitals are forced to charge exorbitant prices to your insurance company to keep the lights on because they're required to care for everyone who walks through that ER door, whether they can pay or not.  Do you think your insurer pays that?  No, Bigun, it gets passed on to you, the consumer, in the form of higher premiums.  

Bottom line: yes, the tax structure would have to completely change.  But you're deluding yourself and others if you preach that it would cost too much and we can't afford it or even that us middle class folks would be paying more overall.  Especially when there are plenty of examples of places that it works.  

[JoeWeber 2,298]

3 hours ago, Phil1111 said:

Sir: you're missing the point. Of course the R& D would still happen. The industry uses the argument that  "obscene profits" are necessary to maintain a US "advantage" in medical/drug innovation. When they lobby in Washington.

They have established an advantage because of a general advantage of qualified US education and researchers. Together with the US advantage in equity markets that gave rise to many of the top drug/medical companies in the world. China is starting to chip away at that advantage due to a effort by China’s pharmaceuticals industry is growing up

U.S. policymakers worry about China 'weaponizing' drug exports

Biotech is high on China’s list of future markets to dominate in their Made in China 2025 policy. Washington is clearly worried.

As for Obscene Profits well:

" The average return on equity for key industries from 2014 – 2016 shows that biopharma’s profits stand at 16.2%, significantly lower than Computer Sciences (31.6%), Beverages (27.4%), Aerospace/Defense (23.0%), and Trucking (19.1%) while modestly higher than Software System/Applications (15.2%) and Healthcare Support Services (14.4%). ...

Internal Rate of Return (IRR) is even more telling. IRR calculates the sales/cash flows resulting from R&D investments, ties R&D and the returns it generates together, and is a more appropriate metric for biopharma productivity. Deloitte reports that the IRR for biopharma R&D has been steadily falling from 10.1% in 2010 to 3.2% in 2017. Even Wall Street hasn’t bought into the “pharma soaring profits” view. Since February 1, 2014, while the Dow has risen 63%, the stock prices of a number of major pharma companies have been muted with Pfizer and Bristol-Myers each growing by about 15%, and Merck and AstraZeneca by roughly 6.5%. Even Lilly’s growth of 43% still lags the Dow. "

Perhaps the net ROI for shareholders would be higher in the absence of $$$ spent on lobbying, defending IP theft, etc.

Damn Phil you are a genius, but then we all are since Google. If you are going to lift text from Forbes an attribution would help your credibility. And Coreece, no surprise you liked it.

[Coreece 190]

18 minutes ago, JoeWeber said:

Damn Phil you are a genius, but then we all are since Google. If you are going to lift text from Forbes an attribution would help your credibility.

He clearly quoted the text and provided a linked citation which is more than what most people here care to bother with.  They just spout their BS and expect everyone to take their word for it.

It's refreshing to have these links as a decent starting place, especially for those of us that don't have time to sail around on their yacht all day talking shit on the internet.

The last poster that I can remember to cite this many sources was nerdgirl.

[jakee 1,254]

13 hours ago, BIGUN said:

Increase taxes - 2.2 T = >$6,000 for every man, woman & child in the US. So a family of four's tax bill would be ~$24,000/year

That is not how tax works. You know that's not how tax works. 

 

Explain why anyone should bother taking your request for details seriously when you're going to come back with such obviously bogus objections?

[JoeWeber 2,298]

13 minutes ago, Coreece said:

He clearly quoted the text and provided a linked citation which is more than what most people here care to bother with.  They just spout their BS and expect everyone to take their word for it.

It's refreshing to have these links as a decent starting place, especially for those of us that don't have time to sail around on their yacht all day talking shit on the internet.

The last poster that I can remember to cite this many sources was nerdgirl.

Aww, you butt sore again? There was no attribution. You may need Phil and nerdgirl to do your research but that just makes you a consumer of what others consider valid, not an independent thinker. 

[Coreece 190]

15 minutes ago, JoeWeber said:

Aww, you butt sore again?

Then why is it you that has such a problem with the facts that  Phil posted?

 

15 minutes ago, JoeWeber said:

You may need Phil and nerdgirl to do your research but that just makes you a consumer of what others consider valid, not an independent thinker. 

My original post that started all this was independent enough - and fairly accurate, apparently.

Edited March 7, 2020 by Coreece

[kallend 1,623]

"You just want free ...." is repeatedly lobbed at those who want state support of education or healthcare.  Why don't these same people whine about the "free" police service, fire service, air traffic control, highway maintenance, army, navy, air force, border protection, coast guard, Trump Wall, etc. that they benefit from?

[Phil1111 910]

14 hours ago, JoeWeber said:

Damn Phil you are a genius, but then we all are since Google. If you are going to lift text from Forbes an attribution would help your credibility. And Coreece, no surprise you liked it.

Nah Social economics with a interest in health care economics was what I studied in university. I hear what you're saying about just quoting from other stories. But when specific facts are quoted I always question the source.Always. That lengthy quote never answered the underlying question about why Pharma returns aren't out-sized.  But was close.

Whenever I paste from a source that I personally didn't write the links are provided if anyone cares to check.

Google, no it should be a great leveler of information. But bias, disinformation, propaganda and outright lies. Have infiltrated the search results because website developers know how to  pander to the algorithms using the proper jargon.

[BIGUN 1,053]

15 hours ago, yobnoc said:

Your underlying assumption is wrong out of the gate.  Yes, healthcare in the US cost US citizens $3.5T in 2018, but $1T of that is revenue that goes directly to private insurance.  Take that out of the mix, cover everyone, and hospitals won't have to charge $1000 for an IV, or $1850/night for a room, or $226 for a suture kit.  What you're forgetting or willfully ignoring is that those with insurance are already subsidizing those without.  The hospitals are forced to charge exorbitant prices to your insurance company to keep the lights on because they're required to care for everyone who walks through that ER door, whether they can pay or not.  Do you think your insurer pays that?  No, Bigun, it gets passed on to you, the consumer, in the form of higher premiums.  

And, your entire premise is wrong out of the gate. The real issue is "administrative & BIR" costs on the hospital's and insurance companies' balance sheets. There's your $1T. You address me as though I'm against Universal Healthcare - I am not. I would like to see a real transition plan and not another failed ACA attempt. There is no plan other than the usual democratic - we'll pay for it by raising taxes. The only way for that to happen is to increase the income tax to over 50%.

I take exception to having to pay out that much in taxes for people that smoke, drink too much, eat fast food, take illicit drugs or the other lifestyle choices that are a burden on hospitals and healthcare.  You look around at any dropzone - don't you find it silly that people can find money to skydive, but can't find the money for a health insurance plan?    

[turtlespeed 212]

On 3/6/2020 at 11:57 AM, Phil1111 said:

The overpayment of drug and medical device R&D goes right to the overall bottom line of those companies. That allows Canada, Australia, India, EU etc. to negotiate lower prices for those same products. The big drug companies may have head offices in Ireland, Switzerland, etc. But the US is still the leader in leading new drug R&D along with medical devices.

I personally find the stories of Americans traveling to Canada to buy insulin offensive. Most are not well off, most are elderly and it borders on criminal.It reflects poorly on America. I welcome them and IMO there should be drive through pharmacies on the US border with bus sized capacity.

Skyrocketing cost of insulin pushes Americans to buy drug in Canada

 

That's kind of silly,  since you can get it OTC at walmart.

 

[turtlespeed 212]

19 hours ago, JoeWeber said:

Aww, you butt sore again? There was no attribution. You may need Phil and nerdgirl to do your research but that just makes you a consumer of what others consider valid, not an independent thinker. 

Jesus Joe.  

Why are you, so often, this condescending, and hateful?

[JoeWeber 2,298]

1 minute ago, turtlespeed said:

Jesus Joe.  

Why are you, so often, this condescending, and hateful?

Relax. I PM Coreece pink hearts all the time.

[turtlespeed 212]

Just now, JoeWeber said:

Relax. I PM Coreece pink hearts all the time.

Coreece, or Coreeece?

[JoeWeber 2,298]

Just now, turtlespeed said:

Coreece, or Coreeece?

Don't you be snugglin' up to my man now, ya' hear?

[kallend 1,623]

On 3/6/2020 at 11:57 AM, Phil1111 said:

The overpayment of drug and medical device R&D goes right to the overall bottom line of those companies. That allows Canada, Australia, India, EU etc. to negotiate lower prices for those same products. The big drug companies may have head offices in Ireland, Switzerland, etc. But the US is still the leader in leading new drug R&D along with medical devices.

I personally find the stories of Americans traveling to Canada to buy insulin offensive. Most are not well off, most are elderly and it borders on criminal.It reflects poorly on America. I welcome them and IMO there should be drive through pharmacies on the US border with bus sized capacity.

Skyrocketing cost of insulin pushes Americans to buy drug in Canada

 

We were just in Costa Rica on vacation.  Remarkable number of US folks seem to be there for medical and/or dental treatment.  On the way home we stopped off in Baja, where pharmacies line the streets of Cabo selling "prescription" drugs to 'Muricans.

[yobnoc 142]

5 hours ago, BIGUN said:

And, your entire premise is wrong out of the gate. The real issue is "administrative & BIR" costs on the hospital's and insurance companies' balance sheets. There's your $1T. You address me as though I'm against Universal Healthcare - I am not. I would like to see a real transition plan and not another failed ACA attempt. There is no plan other than the usual democratic - we'll pay for it by raising taxes. The only way for that to happen is to increase the income tax to over 50%.

I take exception to having to pay out that much in taxes for people that smoke, drink too much, eat fast food, take illicit drugs or the other lifestyle choices that are a burden on hospitals and healthcare.  You look around at any dropzone - don't you find it silly that people can find money to skydive, but can't find the money for a health insurance plan?    

I wouldn't be opposed to a universal health care initiative that levies additional fees on people who are smokers, obese, or test positive for drugs to make sure that they are paying for their choices.  That said, I think that they should have completely subsidized (I won't say free because I know that triggers you) access to smoking cessation programs, gyms, and rehabilitation centers.  

I think the stereotype of the "welfare queen" is so ingrained in our society now that it makes it really hard to understand the plight of those in poverty.  This is a really good video of a West Virginia woman addressing Congress about poverty.