Health Care

"When someone breaks their arm, they deserve to go bankrupt," said no one, ever.  

Everyone wants affordable health care.  The problem is that our current system is so deeply rooted around profit that to do away with it all at once would be economically catastrophic.  We've painted ourselves into a corner. If we want to change our system, we have to do it with baby steps.

This is what led to Obamacare. Obamacare was not Obama's ideal plan, it was simply the only measures he could take with what was given to him.  His answer was a mandate - in theory that mandate would drive many more customers to the market, which would lead to competitive pricing.

The problem with this is that you're relying on the profit margins of the insurance companies to narrow and cut people a break. But in reality, the insurance companies are at the mercy of the pharmaceutical prices.

For instance, let's say my insurance plan pays for my birth control. A generic birth control costs $30. The name-brand costs $400.  Well heck! if my insurance plan pays for it, I'm getting the good stuff! My insurance company doesn't want to buy the expensive stuff all the time, so they incentivize the generic brand with a smaller copay. All generic drugs are $10, all brand name are $25. Ok, now I'm more likely to buy the generic brand because I can't actually tell the difference. Well, what happens when I get to my pharmacy and there's a manufacturer's coupon at the register for $15 off of my name brand birth control? Sweet! I'm getting the name brand for the same cost as the generic!  So now everyone is buying the name brand birth control, and the insurance companies have to account for that by increasing premiums. Everyone has to make a profit.

Unfortunately pharmaceuticals are not like everything else on the market. People need them. When I get hit by a car, I don't get to spend a week shopping around for the right hospitals, doctors, pain medication, etc. Think about the last time you were in the hospital. Did you question the brand of needle that went in your arm and make sure that you were getting the right price for it?  How about the bottle of iodine and the cotton swab?  It sounds silly, but this is the hidden problem that we don't think about.

The truth is, there's nothing to say which brand of needle can go in your arm. You will not be asked, and that hospital may not even have any other options. But you WILL be expected to pay for it. It's like going to Applebee's  and having someone pick the Bourbon St. Steak for you (like it or not) at an unlisted price, force-feed it to you, and then hand you a bill for $3,000.  By law you are required to pay the full amount because, after all, you did eat it. Where's the competition? Where does capitalism work its magic - where the consumers get to shop around and drive prices down?

This is why there is a huge portion of the population who is pushing for universal healthcare. I don't have to talk about the number of people in this country who have gone bankrupt because of their medical bills, or how some people work two jobs to pay for their child's cancer treatment at a time when their child's nerds them to be home the most. You and I (the 98%), see it in our everyday lives.  Obviously this is a big problem, especially at a time when things like autism and diabetes are at record-high levels.

Now, to be fair, there is actually a benefit that comes from privately owned pharmaceuticals:  innovation. There is incentive to constantly fund research for the best newest treatments for the things that affect us the most. Unfortunately it is also paired with a flaw in the system, and that is the incentive to keep everyone sick - but alive - for as long as possible. If I'm Pfizer, and a bio-chemist comes to me with a patent for a cure for HIV, I buy it from him in order to keep it out of my competitor's hands. But I stash it away, because the minute I cure someone of HIV is the minute they stop being my paying customer. So instead I put out a treatment that keeps an HIV patient alive and well as long as they are using my very expensive treatment.

THIS HAS TO STOP. These are people's lives that are at stake.

So how do we  switch over to a universal system when so many profitable businesses are at stake? Obviously you can't bankrupt a whole industry overnight - that would be economically catastrophic. But what we can do is enter the market ourselves (the government), and be the most competitive. We give everyone a heads-up, and a chance to sell their companies to us first. If they decide not to, we simply put them out of business by undercutting them the good old fashioned Capitalist way.

First, you cap insurance prices and put a transition program in place so that over a span of about 5 - 10 years, the insurance companies can invest in other industries that are more sustainable (perhaps even other types of insurance). Then you outlaw disease-related patents and begin to buy up pharmaceutical companies one-by-one at a reasonable price.  If they refuse to be bought out, we simply open our own manufacturing plant that produces the same medication (it's no longer patented at this point), and we under cut their prices so that they can no longer stay in business.  Gotta love Capitalism.

Keep in mind, there is no such thing as a "mom and pop" pharmaceutical company. These people already have a well-established amount of wealth, and will in no way suffer from being bought out. Just like the prison owners, they will now have a chunk of change to invest in other industries. At this point we will have eliminated huge profit margins, so the tax increase we will need from the people in order to fund it will end up being lower than what they were having to pay in health insurance premiums.

This is an ambitious plan, so it has to be done with careful planning so as to ensure a smooth transition for anyone whose income is affected.

So how do you incentivize innovation? The answer is: any way you can. Grants, contests, awards/prizes, scholarships, partnerships with Universitites, promises of guaranteed employment, etc.  The reality is, the more we spend on incentivizing innovation, the less we will spend in the long run on manufacturing treatments.  It's time we set our sites on cures.