Government Healthcare

[spoonbill]

Canada currently has a problem with black-market medical clinics.  Doctors are providing medical care to patients for cash, outside of the socialized medical system.  Citizens are also traveling outside of the country for diagnostics, surgeries and treatment.  

This is illegal in Canada and they have been cracking down.  This has caused another exodus of physicians from the country, leaving them with a severe shortage.  To respond to this, Canada has expanded the role of PAs, nurses, and some medical assistants to treat patients, deliver children, and prescribe medicines.

If (and probably when) we have a socialized healthcare system, what is to stop doctors from offering their services to patients directly?

Would we go so far as to jail physicians for providing services to patients for cash like Canada?

Our insurance companies are already forcing some of our medical professions to open clinics outside of the healthcare insurance system.  We are already expanding the roles of PAs, nurses and medical assistants in our hospitals to save money.

Another question. . . New advances in medicine and disease research are currently financed by the prices you pay for drugs at the pharmacy.  Some are quite expensive.  The US has lead the world in drug development and disease treatment for decades.  When we subsidize the purchase of medicine we regulate the profits.  What happens when you subsidize the profit from drug companies?  What would motivate them to engage extra resources in research and development if there was no opportunity for increase in profit, and a more significant chance for loss?

One fifth of our uninsured hospital admissions is an illegal alien.  Under a socialized medicine system, one would assume, you must provide proof of citizenship to receive medical care.  Hospitals absorb this cost by passing it on to you and the insurance companies in the form of increased rates.

Would we still provide free care to illegal aliens?  How would the government hospitals pay for this?

[nathanm]

Your premise is incorrect. Physicians in Canada are perfectly free to run private clinics. What they cannot do is take patients under the public system and private patients both, except in Quebec.

I'm just guessing, but you probably got that information from right wing talk radio. They like to use lies of that nature to advance their agenda of not fixing our current obviously broken system.

And a note on drug research: Drug companies spend more on advertising than they do R&D. Eliminate advertising and they could cut the price of drugs in half and keep their profit margin the same.

As far as illegal aliens are concerned, many if not most work jobs where they have payroll deduction, they just get the jobs with invalid or stolen social security numbers. Presuming we finance the system through income tax, they'd pay for it that way. Otherwise they would be covered like any other jobless person.

BTW, you talk as if we don't have a shortage of doctors here, when we obviously do in many areas, although in our region the problem is greater in nursing than in actual doctors.

[spoonbill]

quote:Originally posted by nathanm

Your premise is incorrect. Physicians in Canada are perfectly free to run private clinics. What they cannot do is take patients under the public system and private patients both, except in Quebec.

You are correct.  There are very few physicians that can make a living on running a private only clinic, since medical insurance and reimbursement are illegal except in Quebec where they ruled that would constitute a monopoly, and allow it.  This causes many physicians to offer some services under-the-counter or through small clandestine offices. These physicians are prosecuted, in many cases for offering services that the government system denys or delays their patients in recieving.

quote:I'm just guessing, but you probably got that information from right wing talk radio. They like to use lies of that nature to advance their agenda of not fixing our current obviously broken system.

 

No, I got it from my uncle who is a physician in Vancouver on our last fishing trip off of Victoria.

quote:And a note on drug research: Drug companies spend more on advertising than they do R&D. Eliminate advertising and they could cut the price of drugs in half and keep their profit margin the same.

You scared me for a moment there, I thought you were telling the truth.

Since I own most of these stocks I went to my prospectuses and found the advertising budgets.  I did a little comparison.  You must be listening to too many left wing radio shows (are there any?).

Advertising budgets are equal to around 3% to 5% of earnings compared to R&D which is 17% to 25% of earnings.  This advertising budget is about the same as most large companies.  Some of the smaller Pharma companies spend over 50% of earnings on R&D and walk a very thin line.

Select companies advertising budgets for 2007:

Pfizer, $1.1 billion ADV ($48 Billion earnings) $7.2 billion R&D
Wyeth, $877 million ADV ($22.4 billion earnings) $3.4 billion R&D
Novartis, $488 million ADV ($36 billion earnings) $5.4 billion R&D
Merck, $1 billion ADV ($25 billion earnings) $4.27 billion R&D


That said, I don't agree with a prescription medication advertising on TV to the end user.  You shouldn't have to tell your doctor what to prescribe for you!

quote:As far as illegal aliens are concerned, many if not most work jobs where they have payroll deduction, they just get the jobs with invalid or stolen social security numbers. Presuming we finance the system through income tax, they'd pay for it that way. Otherwise they would be covered like any other jobless person.

Yes you are correct that they do use stolen #s. They are also required to file a W-4 at the time of employment (here's where the fun begins).  I'm not proud of this, but I worked in an industry for years that employed people of questionable immigration status.  We had around 300 each year that worked for us.  They provided us with their SS# and name (I think we had around 150 Jose Garcias)  They filled out their W-4 with the maximum deductions so that we were withholding little or none from their paycheck.

quote:BTW, you talk as if we don't have a shortage of doctors here, when we obviously do in many areas, although in our region the problem is greater in nursing than in actual doctors.

I am very aware of this.  Do you wonder why?  

After 12 years of college and medical school, my brother makes around $190,000 a year.  Not bad.  In 1980 a cardiologist (my bro's specialty) would make around $250,000 a year.  A good one with a large patient base could make much more.  Each year he makes less and less, and the insurance companies make more and more.  Now they are telling him how many patients he must see a day and how long he can spend with them.  He has to call the insurance company to find out what drugs he can give his patients and what surgeries they can or can't have.  

[cannon_fodder]

1. Shortage of doctors is man made.  Thank the AMA and the immigration laws.  They combine to keep a shortage of MDs year in and year out to the tune of nearly 4,000 per year.  

Simply math really.  If we need X doctors, we only allow Y into our medical schools, only allow Z to immigrate and Y + Z < X; we will have a shortage.  Which we have for nearly a generation now.

The problem is as much government caused as anything else.

2. Due to socialized medicine private clinics in Canada are extremely difficult to run. Just like many Americans would rather have cable TV than health insurance, many Canadians would rather wait 6 months than pay for a private clinic.  So while it is hyperbole to say doctors can not offer services directly to patients, in practicality that is often the result (accept government employment and you are prohibited from doing so outside those confines).

3. There is a consistent 2:1 ratio in drug companies it seems.  I ran the S&P reports on Bayer, Merck, Bristol Myers, and Pfizer.  Each had 2 time the administrative expense as R&D.

The problem with the statement that they spend more on advertising is that like all financial statements their marketing revenue is tied to "administrative, sales and other."  Considering that most non-research salaries (board, CEO, managers, accountants, finances, in-house counsel) as well as buildings, company planes and on and on... come from this fund.  Certainly marketing is NOT half their non-R&D expenses.  

I looked for evidence of that statement but never could find any.  Plenty of XYZ.blogspot.com talking about it but I was hard pressed to find a source that was a non-blog and a non-advocate.

And even if true, so what?  American drug companies still account for most of the private pharmaceutical research expenditures in the world.  Are you implying that those companies should then be restricted in what they do with those products?  Clearly the system is not perfect and favors treating "popular" illnesses that one can easily profit from, but in many areas this system has proven unbeatable.  

I'm very glad we have national laboratories and universities seeking less-profitable drugs and treatments.  But I'm afraid every country that has restricted the bennefit of research (marketing and sales) has seen research decline.

[si_uk_lon_ok]

To be honest, I've never been into a hospital where they have checked your right to use the service.

I shared a house with a guy from California and he got free moulds of his feet done, had physiotherapy, saw a GP and got subsidised prescription medicine and while he was entitled to it they never asked for proof.
I've also rushed someone to the emergency of one of the best eye hospitals in the world and was never asked for proof they were a citizen or had a right to use the health care.

I can't say that is what the US would set up, but that has been my experience of access to medical services in a country that doesn't have a US style system. I would caution you very strongly to use this though and say 'well that's what will happen here'. The US has the opportunity to create a system that best fits its needs, not merely copy an existing model.

[swake]

Most of pharmaceuticals R&D budgets are spent on creating new drugs that address health issues where an existing and effective drug already exists. In some cases the existing drug's patent is expiring and in others the existing drug is from a competing company. A lot more money is then spent advertising to get you to switch from the current drug to the new one.

Another fun facet to the current model is that drug studies are currently far from impartial. It is so expensive to bring out a drug that the companies cannot afford to have a drug fail testing.

All of this keeps costs high and actually makes drugs less safe. Drug research could and should be moved outside of the private realm and be done in the academic world and in other government funded labs. Drug companies should focus on the safe manufacture of drugs and not the constant expensive research into mostly needless drugs and the related advertising. The result would be cheaper, and safer, drugs.

[spoonbill]

The system is broken!  On that we can all agree.  This happens in a Free-market system.  It's like the pendulum on a clock.  It swings to the extreme and then people rebel and it begins to swing back.  We are already seeing docs, clinics, and some hospitals opt-out of the traditional system.  We are already seeing company hire corporate physicians to provide free medical care for their employees rather than pay huge insurance costs.

But before we allow this natural free-market correction, we're gonna punish healthcare, by subjecting it to the worst, most wasteful, and inefficient form of management possible.  We're gonna pull it out of the free-market system.

We're gonna give it to the government.  We are going to take a huge bureaucratic system and turn it into a bureaucracy, so large and overwhelming that it will require an entire new vocabulary to understand.

We will certainly have to make sacrifices to personal liberty.  Other industries will have to follow for the system to function.  Once the free-market is eliminated from diagnostics, pharmaceuticals, medical equipment and other industries, the government will have to come in and subsidize.  

[si_uk_lon_ok]

quote:Originally posted by spoonbill

The system is broken!  On that we can all agree.  This happens in a Free-market system.  It's like the pendulum on a clock.  It swings to the extreme and then people rebel and it begins to swing back.  We are already seeing docs, clinics, and some hospitals opt-out of the traditional system.  We are already seeing company hire corporate physicians to provide free medical care for their employees rather than pay huge insurance costs.

But before we allow this natural free-market correction, we're gonna punish healthcare, by subjecting it to the worst, most wasteful, and inefficient form of management possible.  We're gonna pull it out of the free-market system.

We're gonna give it to the government.  We are going to take a huge bureaucratic system and turn it into a bureaucracy, so large and overwhelming that it will require an entire new vocabulary to understand.

We will certainly have to make sacrifices to personal liberty.  Other industries will have to follow for the system to function.  Once the free-market is eliminated from diagnostics, pharmaceuticals, medical equipment and other industries, the government will have to come in and subsidize.  

If that were the case why does Canada spend only  $307 per capita on health administration costs, but in the US the costs are $1,059 per capita. Administration accounted for 31.0 percent of health care expenditures in the United States and 16.7 percent of health care expenditures in Canada.

http://content.nejm.org/cgi/content/abstract/349/8/768

[cannon_fodder]

Swake, I agree with you to a large extent.  I also think that Costco, Walmart, and even insurance companies are now taking steps to tell people that new brand name drugs are NOT always better.  There are two parties in the system - the producer and the consumer.  Since the producers are motivated by $$$ the intercession parties in this instance should, and are, stepping up (I wish doctors would more too!).

Though, I obviously agree that the system is flawed and would be more than happy to adopt a different system; I just don't believe more government will improve it.  Certainly it hasn't improved our schools, our retirement, or most other programs it touches.  In fact, where anyone has a choice between government of private nearly everyone choses private.

Our government is incompetent, slow, over-reactionary (omg, terrorists! Apparently forgetting the previous attacks), wasteful, and flippant.  I want them in my life as little as possible.

[spoonbill]

quote:Originally posted by swake

Most of pharmaceuticals R&D budgets are spent on creating new drugs that address health issues where an existing and effective drug already exists. In some cases the existing drug's patent is expiring and in others the existing drug is from a competing company. A lot more money is then spent advertising to get you to switch from the current drug to the new one.

Another fun facet to the current model is that drug studies are currently far from impartial. It is so expensive to bring out a drug that the companies cannot afford to have a drug fail testing.

All of this keeps costs high and actually makes drugs less safe. Drug research could and should be moved outside of the private realm and be done in the academic world and in other government funded labs. Drug companies should focus on the safe manufacture of drugs and not the constant expensive research into mostly needless drugs and the related advertising. The result would be cheaper, and safer, drugs.

Already been attempted in other countries with dismal failure.  You see the push for new technologies, new drugs, a better mouse trap, a more absorbent tampon, etc. is always fueled by monetary reward.  No matter what you apply it to.

Your stance was the stance of Communists before they acquired power,  when Russia was a blooming scientific power.  They moved scientific, drug, technological, and military research from the private sector to government funded university labs.  Within 20 years they were so far behind the rest of the world there was no salvation.

Germany
China
Venezuela
Cuba
France

They produce nothing of consequence.
Why would a scientist, an inventor, or a craftsman want to work within a system that offers minimal reward and maximum regulation, when he or she can work in a system with huge rewards, maximum freedom and all the best equipment?

The funny thing is that some of the above companies (France & Germany) have free-market pharmaceutical companies outside of their government programs that rely on the United States to provide their income, and they trade in US markets.  

As for your comment about safer drugs, I'm not even going to address that.  Compared to . . . well everywhere. . . we have the safest most regulated drug system in the world.  

I know it upsets most liberals, but humans are wired for profit (or reward).  If there is no reward, their is very little performance.  This is a lesson that they don't teach in college because it is not a "sensitive" subject.  It's why most of us start out as liberals and then eventually we learn human nature, and adopt a philosophy that makes us happier and more successful.  

It's why Communism, Socialism, and Fascism fail every time.

[we vs us]

quote:Originally posted by cannon_fodder


3. There is a consistent 2:1 ratio in drug companies it seems.  I ran the S&P reports on Bayer, Merck, Bristol Myers, and Pfizer.  Each had 2 time the administrative expense as R&D.

The problem with the statement that they spend more on advertising is that like all financial statements their marketing revenue is tied to "administrative, sales and other."  Considering that most non-research salaries (board, CEO, managers, accountants, finances, in-house counsel) as well as buildings, company planes and on and on... come from this fund.  Certainly marketing is NOT half their non-R&D expenses.  

It points out, though, that the direct correlation that Spoonbill draws between profit and R&D isn't as straight-line as he might like.  Just as in any industry, a lowering of profits doesn't simply mean cutbacks; it can also inspire consolidation, streamlining, and finding profit and efficiencies elsewhere. I guarantee that even lowering that 2:1 ratio by a fraction would make a major impact on costs.

One study that I saw from 2005 (by Harvard U and the Kaiser Foundation) found that healthcare costs rose by an average of 2.5 percentage points more per year since 1970 than GDP.  So it outpaced our economic growth every year for the last 35 years.  Up to that point in 2005, the study estimated, we had dedicated 16% of our GDP to healthcare costs. And it was only rising.  

R&D itself isn't necessarily as virtuous a process as we might like, either.  Most of the big pharma companies rely on big "lifestyle drug" successes (Levitra, Cialis, Lipitor, etc) for their profit margins, rather than an drug that targets, say an illness that effects a relatively small segment of the population (in which the profit margins are much smaller).

I can't speak authoritatively about Canadian healthcare, and though I respect Spoonbill's uncle's point of view, I've been searching high and low for information on black market clinics and haven't been able to come up with anything illuminating at all. Spoonbill, if you've got an article or anything to reference, I'd be much obliged.  

[spoonbill]

quote:Originally posted by si_uk_lon_ok

If that were the case why does Canada spend only  $307 per capita on health administration costs, but in the US the costs are $1,059 per capita. Administration accounted for 31.0 percent of health care expenditures in the United States and 16.7 percent of health care expenditures in Canada.

http://content.nejm.org/cgi/content/abstract/349/8/768

So glad you brought that up!  You are right.  Canada has a very efficient system of medical coding.  Their review system does not rely on quick results like ours.  That's why diagnostics and other procedure that require review take so long in Canada.

We on the other hand have the Medicare and Medicaid system, in which each doctor in the US. has a person on staff that does nothing but prepare, code and submit documents to the federal government for reimbursement.  These documents are then reviewed just like the IRS system.  If there is a discrepancy in the coding they are rejected or researched by a nurse or government consultant.  (medical code books are huge phone-book like volumes)

My Brother had discrepancies as small as $6.00 go to review, costing hours of time in the submission of records, and in one case he had a review nurse show up at his office for a $22 discrepancy on a patients medicare submission.  She spent half a day reviewing the case, and the patients records before she found his assessment to be correct.  2 months later he received his reimbursement.

[we vs us]

Spoon, man, we were having a nice discussion here and you completely drove it off into the ideological ditch.  

Can we maybe continue civilly, without you telling me I'm gonna start crying if we don't collectivize our farms RIGHT NOW?

[cannon_fodder]

Well Wevus, if nothing else Spoon is pointing out what a horrible job our government is doing in it's foray into health care.  I don't think he was trying to, but if he was... it would be a really bad case for handing MORE health care responsibility to the government.

[swake]

A "free market" has led us to where we have the least efficient health-care system on the planet.

We spend substantially more money per capita than any other nation on earth (44% more than number 2 Switzerland) and end up with one in six people completely without any health coverage at all and the leading cause of bankruptcy is medical bills.

More than one fourth of Americans already are on government insurance of some sort and every other developed nation has some sort of nationalized health care. There are some areas where government does a better job than private industry. This is one of them.