While laid low by my ritualistic Tax Day illness (“curse you IRS!”), I wondered about the problems faced by America’s health care systems, particularly those related to cost.
Overly Broad Patent Protections
This is the one liberals like to complain about, but it not less true for that. Patent holders understandably want to make as most money out of its legal monopolies as possible, and engage in a variety of maneuvers to achieve it. That delays the availability of drugs and procedures to the “poor”. Although this is a problem, I think this is a failure of government. Drug companies can do that because they develop overly warm relationships with the people that are supposed to keep them in check. (This is the infamous regulatory capture, which is, in the end, a failure of government).
Burdensome Clinical Trials
Let’s talk about monopolies—the monopoly of the FDA over the regulatory process involving clinical trials. That also delays, and often prevents, life-saving drugs from reaching the market. The process is so expensive that drugs without a large market are never developed. A lot of people with small-incidence illnesses get a premature death arrival because there is no incentive for drug companies to develop such drugs. The FDA doesn’t care—as long as the drugs it does approve are “safe”, its regulators won’t get called in front of a congressional committee to get berated by ignorant congressmen.
Third-Payer System—On Steroids
Due to a small historical accident—World War II and the FDR wage controls—the United States ended up with a healthcare system in which not only the entity making healthcare payments is not the patient, but the entity that chooses healthcare coverage is usually not the patient either. This is one of the causes of the ‘spiraling’ costs of healthcare in the United States; executives at insurance companies sell plans to executives at firms, while the person who uses the insurance doesn’t think too hard about it. (The employee cares about the overall quality of the job, not the quality and cost of the insurance offered). Our job-centered insurance scheme is not only vaguely socialistic, but it adds the worst parts of crony Capitalism too.
Life and Health
Finally, I’d be remiss if I didn’t mention the biggest driver of cost in healthcare spending—the human desire for life and health. Keeping human beings alive and healthy takes the dedication of other human beings. Doctors and nurses need to be paid. Hospitals do not build themselves. As mentioned previously, developing a successful drug costs a lot of money. Most of us don’t want to go gently into the good night, and desire to be well enough to enjoy those nights we still have too.
