The Fix
Audio Recording by George Hahn
The Fix
This week, President Trump signed an executive order to lower drug prices, demanding the U.S. receive most favored nation status from pharmaceutical companies — that they charge Americans the lowest price paid abroad. Trump said his policy would cut drug prices by 59%: “Whoever is paying the lowest price, that’s the price that we’re going to get.” One issue though: It’s bullshit. Pharma stocks fell initially, but they more than recovered once the market realized the executive “order” is voluntary. The markets saw the order as a Mack Truck sees an insect — barely. The announcement is laughable when set against the regulatory capture of the U.S. healthcare industry.
Up Against It
In the Wall Street Journal, historian Niall Ferguson wrote, “any great power that spends more on debt service than on defense risks ceasing to be a great power.” Sooner or later, the interest on the debt crowds out a nation’s capacity to do anything else — fight wars, survive pandemics, build infrastructure, fund social safety nets, etc. In fiscal year 2024, the federal budget earmarked $877 billion for defense and $878 billion to pay the interest on our debt. As Ferguson explained, “America’s fiscal position is far more constrained today than ever before.” In fact, he argued, we’re facing a debt crisis similar to the ones that contributed to the downfalls of the Spanish, French, and British empires. As I previously wrote, countries typically are not conquered — they go broke. America is up against it.
Fiscal Gap
Reigning in our debt should be a national priority, but it isn’t. Congressional Republicans are working to make Trump’s tax cuts permanent, which would add $9 trillion to the debt — 3x the national debt of Germany. During the campaign, Elon Musk said he’d cut $2 trillion from the federal budget. More recently, DOGE claimed to have saved $160 billion, but a nonpartisan analysis determined those cuts came at a cost of $135 billion, netting savings of $25 billion. The GOP refuses to acknowledge math and believes the nation will grow if we cut taxes to zero. Meanwhile, nearly all Democrats oppose entitlement cuts, and most also oppose cutting defense spending, believing instead that we can tax our way out of debt. This bipartisan Kabuki dance is juvenile. Just as parents tell themselves their kid “doesn’t need college in today’s world,” we’ve decided there is a free lunch, governments with their own reserve currency don’t risk default, and we’re not headed toward a cliff.
Modern Monetary Theory is the latest consensual hallucination between policymakers who want to excuse their past behavior and those who want an excuse to spend more. They believe a perpetual motion machine does exist. Spoiler alert: It doesn’t. I received a degree in economics (weak flex, as I graduated with a 2.27), taught macro- and microeconomics in grad school (better flex), worked in fixed income for Morgan Stanley (getting weaker again), and have written several books on economics and finance (you decide). It’s dangerous to be certain, and I’m not an economist. But I am … certain that MMT is fucking stupid, and any economist espousing this intellectual traif makes RFK Jr. seem like Jonas Salk.
Anyway, when the adults show up we should have a serious sit-down re closing the fiscal gap — the amount the government needs to raise taxes and / or cut spending, as a share of GDP, to stabilize our fiscal health. The Treasury estimates the current fiscal gap is 4.3% of GDP. Stanley Druckenmiller, famous for betting against the British pound and delivering 30% annual returns over three decades, puts the gap at 7.7%.
U.S. debt-to-GDP currently stands at 120%, with the CBO projecting it could rise to 160% by the 2050s. But in a presentation that should be required viewing for Congress, Oakcliff Capital CEO Bryan Lawrence points out that the CBO projections include a number of unrealistic assumptions: no recessions, no wars, no pandemics, 4% interest on Treasuries, 2% inflation, a birth rate of 1.9, the addition of 1.9 million immigrants per year, and Trump’s tax cuts expiring. What we should focus on, Lawrence argues, is the 2% real growth in healthcare costs per capita. A 1 percentage point reduction in the growth of healthcare costs per capita translates to 3% of GDP. According to Lawrence, that gets us halfway to our goal of eliminating the fiscal gap, which he estimates to be 6% of GDP. In sum, reducing healthcare costs isn’t the best option, it’s the only option.
Expensive, but Bad
Every election cycle, candidates tell Americans their healthcare system is expensive and broken. Yes, Americans know this. Incomprehensible insurance bills, medical and dental debt haunting 40% of U.S. households, and trips to Canada or Mexico for cheaper prescription drugs have turned our healthcare system into one of our biggest sources of emotional distress. U.S. healthcare is a $4.9t corrupt cop. In a report that looked at costs and outcomes across 10 industrialized nations, researchers at the Commonwealth Fund wrote, “The U.S. continues to be in a class by itself in the underperformance of its healthcare sector.” For those in the back of the class, that’s the wrong kind of exceptionalism.
According to the most recent data, the U.S. spends $13,432 per capita on healthcare — more than twice what the average comparable nation spends. We pay 8x what Germany and Switzerland pay for Ozempic and 7x what they pay for Humira. Insulin, which has been in mass production since the 1930s, costs 8x more in the U.S. than it does in Greece. The median cost of a coronary bypass in the U.S. is $89,000, approximately 8x and 5x what the procedure costs in Spain and Australia, respectively. In the U.S. a childbirth with a C-section costs 4x what it does in South Africa. An appendectomy in the U.S. costs 3x what it does in the U.K. For what we spend, we should be the healthiest nation among our peers. We aren’t; we pay significantly more for dramatically poorer outcomes.
Follow the Money
This week, House Republicans floated $880 billion in Medicaid cuts over the next decade to help pay for Trump’s $4.5 trillion tax cut. Even by Washington standards, the math doesn’t math. But considering the GOP’s slim Congressional majority and the political fallout from throwing an estimated 8 million people off the health insurance rolls, the proposal likely won’t go anywhere. These aren’t serious people.
A serious person would ask a simple question: Where does the money the U.S. spends in excess of what other nations spend on healthcare go? Answer: 30% of it goes to administrative costs, split evenly between providers and insurers. Another 10% goes to prescription drugs. Higher salaries for U.S. doctors and nurses and investments in medical equipment account for the rest.
Let’s Make a Deal
There’s no silver bullet to lowering costs, but Bryan Lawrence identified our two most powerful tools: Pricing transparency and negotiating prescription drug costs. The 2022 Inflation Reduction Act (worst name ever) granted Medicare the power, for the first time, to negotiate drug prices. Based on a complicated formula, Health and Human Services selected 10 drugs covered under Medicare Part D. The discounts range from 38% to 79%. When these prices take effect next year, Medicare will save an estimated $6 billion, and Medicare beneficiaries will save $1.5 billion in out-of-pocket costs. In the final days of the administration, Biden’s HHS secretary announced another 15 drugs, including Ozempic, would be eligible for Medicare negotiation. Q: Why isn’t the largest purchaser of pharmaceuticals on the planet able to negotiate costs — like everyone else — on all drugs? A: Fuck if I know.
Price Transparency
The insurance industrial complex imprints two ideas into the zeitgeist. First, you’re irresponsible if you don’t have health insurance. Second, the best companies offer employees gold-plated plans as a point of differentiation. As an entrepreneur, I noticed that my firm’s health insurance premiums increased by two or four points above inflation every year. Those costs were effectively nonnegotiable, so when I had the means to do so, I went naked, saving my family $50,000 per year in premiums. Note: I’m not suggesting you do this — I’m fortunate to be able to absorb any healthcare costs.
Total U.S. healthcare expenditures were $4.9 trillion in 2023. Think about the previous sentence: The U.S. healthcare industrial complex is bigger than the entire German economy. Private businesses accounted for 18% of total expenditures, with three-quarters of that money going toward insurance premiums. American households, two-thirds of which have employer-sponsored plans, picked up another 27% of total expenditures via employee contributions to premiums, co-pays, and out-of-pocket expenses. In a functioning market, consumers would allocate their dollars toward lower costs and better outcomes. In the U.S. healthcare market, however, consumers are left in the dark while insurers and providers maximize profits.
More than 90% of Americans support greater healthcare price transparency. I don’t know what the other 10% of Americans are thinking, but I do know that roughly the same share of Americans work in healthcare. Probably just a coincidence. Injecting price transparency into healthcare could save an estimated $1 trillion annually, as employers and consumers could harness the power of markets to lower costs and inspire better outcomes. Senate Republicans, Democrats, and even the chamber’s lone socialist support the Health Care PRICE Transparency Act 2.0. So why hasn’t it become law? Because money is speech, and the healthcare industry and its lobbyists have told Congress, “Give us America’s wallet, or we will fucking kill you (get you booted out of office).”
K Street
In 2024, U.S. businesses spent $4.4 billion on lobbying. It may be the greatest ROI in economic history. One study found that lobbying connected to a 2004 law that created a one-time tax holiday for repatriated profits delivered a 22,000% return. In 2013, Amgen spent $5 million lobbying Congress for a two-year reprieve from Medicare price controls on a single drug. That effort resulted in $500 million of Medicare payments to Amgen. No other industry embodies regulatory capture like the healthcare industrial complex.
Andor
I’m watching Season 2 of Andor. It’s the best television show so far in the Star Wars franchise, but even if the Force isn’t strong with you, Andor is an illuminating case study in how revolutions begin. When we meet Cassian Andor, he’s a petty thief, but as the Empire steps up pressure across the galaxy, our hero and others like him evolve into revolutionaries.
Luigi Mangione, who allegedly murdered a health insurance CEO, isn’t a revolutionary, but he’s become a folk hero. His crowd-funded legal defense fund recently topped $1 million, with an average donation of $20. That a murderer would be seen as a hero is depraved — and revealing. Given everything America has lived through — deindustrialization, two forever wars in the Middle East, the Great Recession, an opioid epidemic, the highest per capita pandemic death rate among comparable industrialized nations, the largest generational wealth transfer in history, and millions of young men failing to launch — it’s not surprising that voters chose a felon who promised that he alone could fix it. He can’t, but if we don’t fix it, the wealth inequality at the root of America’s pain will self-correct via war, famine, or revolution.
Every One
A story that haunts me: For the first time, the New York Times announced the wedding of a young couple who weren’t legally getting married — just having a ceremony. The bride was suffering from terminal brain cancer and didn’t want her husband to inherit her medical debt when she died. We live in the most prosperous nation in history. We shouldn’t be asking our kids to borrow money to support their parents’ and grandparents’ lifestyle. And our daughters, every one, should be able to get married.
Life is so rich,
P.S. Did you know I have another newsletter? The Prof G Markets Pod now has a newsletter edition. Sign up here to receive it every Monday. What a thrill.
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Biden Regime Hid Deadly COVID-19 Vaccine Heart Risks From Public, Explosive Senate Report Finds
Even though CDC and FDA officials were well aware of the risk of myocarditis following COVID-19 vaccination, the Biden administration opted to withhold issuing a formal warning to the public for months about the safety concerns, jeopardizing the health of young Americans,” the report states.
In just six months, the toll was staggering: 384,270 reports of adverse events, 4,812 deaths, and 1,736 of those occurred within just 48 hours of injection.
Before COVID, McCullough had seen just two myocarditis cases in his entire career. After the rollout, everything changed.
He says he’s now “examined thousands of patients with this problem.”
“Enough already. Federal law should require any citizen who wants to cash a government check, use public transport, or enter a place of business to show proof of vaccination.” Scott Galloway
EVERYONE THAT THREATENED, HARASSED, AND BULLIED ANYONE INTO TAKING THESE EXPERIMENTAL DRUGS IS LIABLE
Scott: I hear a lot of people bash modern montary theory (MMT) as bullshit but I never hear why from you folks. Consider this: the US has been in debt since 1835 ( Andrew Jackson). The debt to GDP ratio certainly varied over those years especially after WWII. But all things considered I think we have done pretty well as a country for the last 190 years DESPITE THE FACT WE CARRIED A LOT OF DEBT. Interest rates have remained low and flat for many years recently ( before the pandemic ) while debt climbed, so there really isn’t a correlation there. 70% of the debt is held by the US ( everyday consumers and our government ). So if you reduce that debt, don’t you deprive those consumers of the interest they recieve?
Explain it to me, don’t just tell me its bullshit.
Galloway would rather America fail than have Trump succeed.
When America / Trump / the Stock Market is doing well and Galloway’s net worth goes up, that actually makes Galloway sad.
Galloway stands around day drinking in his pajamas, broadcasting his misery, sad that Trump put some extra money in his pocket.
You can not talk reason with people that are so infatuated with their own mental illness.
But you can call them out on their hypocrisy when they then try and cosplay as normal, objective, well balanced people.
Galloway would rather America fail than have Trump succeed.
DESEO RECIBIR EL BOLETIN INFORMATIVO
When you look at the facts as you have presented them without embellishment, the systemic faults at the heart of the American project are so great that the only logical conclusion is systemic collapse, and probably closer to the event horizon than it is comfortable to imagine.
I get paid over $130 1 to 3 hours working from home with 2 kids at home. I never thought I’d be able to do it but my best friend earns over $27k a month doing this and she convinced me to try. The potential with this is endless.
Heress———–> rb.gy/tzkwnx
Breaking: U.S. discovers new health plan — just don’t get sick.
The intersection of sound fiscal policy that helps everyone and politics is ZERO. Your strategy for this is a data driven approach. Even the best legislators know that it’s next to impossible to create policy that is 100% data driven and laser focused on the best results. You would need to fight some powerful interest groups. Raise the age for social security? The older population will scream (plus for people that have done hard manual labor for a living delaying retirement is a bit cruel), Reducing drug prices? Big Pharma will scream and Pharmacy Benefit Mangers, the evil, unregulated industry will fight back. Possibly compensate doctors in line with how other countries do it? The AMA will have a few select words with you. This is also challenging because doctor pay is not great across all forms of medicine, but it’s probably a piece of the problem (maybe help offset medical education costs and physicial liability insurance). How about limiting lobbying and political action committee donations to $1000 maximum per candidate per year. That will cut back some of the resistance when they have no way to buy congressional and presidential votes. Maybe your other suggestions you about paying politician more and making the ways they could possibly make money outside of being politics is also necessary. Curbing the influence of the powerful groups who do not serve the public interest is a critical step if you want to actually make real and sustained change.
I would go one step further than “transparency”. Private healthcare providers (Dr’s, hospitals, scans/tests, etc.) should be allowed to charge whatever they want, but have to charge everyone the same price. Or at a minimum an uninsured, cash paying customer should pay no more than a large insurance provider for identical procedures. The bills for my recent tests were along the lines of $2,400 – less insurance discount of $2,100 – your insurance pays $260 and you owe $40. A cash paying customer would be charged the full $2,400 – and sued for it if not paid. In what other industry are discounts of 80% – 90% or more given to the biggest customers while the small guy pays 5x-10x the price?
So full disclosure I’m English/British (though I get less proud of that by the day) I freely admit my knowledge of US politics is merely that of a non native Layman. What I can talk about though is the NHS. Now it’s not perfect, there are a number of issues, not least of which there are certain sections of some political parties who want to switch us to a US system so they’re lobbying to deliberately underfund it in real terms but I digress. My point is this the same body referenced in this article has consistently over the year ranked the NHS as the no. 1 most efficient health service on the planet meaning that the level of care you receive for the realive cost is truly exceptional. Citizens of the United States deserve something on par or better and you can. The problem is the many years of propaganda around health and economics in the US that have convinced 100s of millions of people to vote against their own interests. This is now becoming something of a sermon but I know for sure there are a large number of desenters in the US, far more than your media would have anyone believe. As much as there are elements trying to drive us off a cliff a majority of us still stand together and with you. We have and always will be your allies.
To hear real life comments on the cost of healthcare in other major countries listen to “Retire There” with Gil and Gene. With the exception of Switzerland all of the interviewees (expats) have very positive statements on the cost and care they receive from the country they have moved to. These include the UK, Spain, Portugal, Italy, most of South America, Mexico, etc. I like you have heard the negative comments on national healthcare but it appears to me now that these are driven from the healthcare system, i.e., lobbyists and congressmen who are supported by them.
None
Scott, great to see you call out the core issue of our debt burden: 2% annual real growth in healthcare costs. While looking for grand solutions, the answer is a small 2% change in the trajectory. The changes necessary to reduce our unit cost growth problem are both obvious and known: policy wonks declared “ACOs” and “value based care” a failure because it produced only 1.5% savings. A voluntary program solved 3/4 of the healthcare cost growth problem – was a failure? And does anyone really think that we can’t reduce the extraordinary US healthcare overhead cost (>10% of all $4+ trillion) by stopping the commercial insurers revenue cycle madness? No other country makes this mistake. We spend more on overhead than on all of child health services. And a friend in Japan just sent me (a doctor) an AI analysis of his daughter’s x-ray (using a cell phone photo) and physician’s note (written in Japanese) and the LLM nailed the diagnosis and treatment. Access to great medical advice is about to get a whole lot easier and cheaper. As for medications, why not a fixed service fee charged on top of the negotiated price? This is not hard (and would save billions to employers and consumers). Four modest policy changes that will certainly produce more than 2% annual changes. #letssolveour2%healthcarecostproblem
Yes, AI is good at doing accurate analysis, machine learning has trained it to do this. Which should help reduce the cost of healthcare.
But technology will never be good at dealing with the actual patience getting them to right judgement call on how to handle them so they take the next steps in the medical process.
And our sons, every one, should be able to get married.
And if they can’t, the Democratic Party should stop its own short-sighted bigoted trash that hates on men who haven’t had sex in at least six months (the actual definition of incel, as set by the woman who coined the term; she said she was incel herself, so the definition applies to women, too).
I get paid over $130 1 to 3 hours working from home with 2 kids at home. I never thought I’d be able to do it but my best friend earns over $27k a month doing this and she convinced me to try. The potential with this is endless.
Heress———–> rb.gy/tzkwnx
Aminawajid must be a Chinese recruiter hiring rocket scientists.
I get paid over $130 1 to 3 hours working from home with 2 kids at home. I never thought I’d be able to do it but my best friend earns over $27k a month doing this and she convinced me to try. The potential with this is endless.
Heress———–>
I currently live in NZ but spend a lot of time in Europe. I have terminal cancer so am exposed to good & bad medical systems. NZ care is hybrid, all hospital and emergency treatment is free. You pay for GP’s visits ($40 – $70). A government agency (Pharmac) negotiates all drug purchases. while the system is over
How about simple things to start:
– 300% tax on sugary carbonated drinks.
– 30% tax on extra large people who harm themselves on purpose and consume most of medical spending
Prof. G, I wish you could get in front of congress and make them hear these things. Then I realize they don’t listen, so it would be pointless. The people that want to fight against the bullshit are happy to hear your input and appreciate the real financial aspect of things, and not just click-bait headlines. Lobbying and privatization has been slowly destroying the USA and seems to be all coming to a reckoning now.
In other western countries the governments decide which medications are really necessary and should be made cheaper than the market price. They negotiate to have those specific medications sold at a cheaper price, they also cover a big part of the cost of people buying them. The pharmaceutical companies like it because more people use their medications and on the whole they make more money than if the drugs could only be brought by individuals at the market rate.
Excellent analysis. The Niall Ferguson quote is so spot on. It is one I tend to quote myself.
One upside to have national healthcare, where the government pays at least a small portion of every medical bill is that:
* The government then has a high level of visibility as to what is happening. They can nip bad stuff in the bud early because they can spot it early.
* Reduces fraud, which lowers the cost of total healthcare
* Reduces the likelihood of overservicing and other unnecessary costs, such as doctors doing unnecessary surgeries just to make money.
* It generally means everyone can at least see a GP, often for free, to check things early rather than leaving a problem to get bigger, which makes it generally cheaper to address. Makes it possible for people to have base line tests for free, like a blood test to check vital information. Prevention and early detection reduce healthcare costs.
* A national healthcare systems means doctors have medically sound pre-printed information to give people so that they work on their own medical issues. Lifestyle is a big part of staying healthy and addressing medical issues.
National healthcare is cheaper than not having it.
Healthy people are more productive at work and they take less sick days off. They are generally able to work to an older age. As older people they are more mobile, more useful in society.
Does Galloway ever admit when he gets it wrong on anything to do with Trump?
If the tariffs work out, if drug prices go down for Americans, if any of Trump’s policies work out for the American taxpayer, are we ever going to see Galloway man up and admit that he got it wrong?
Remember when Galloway wrote that “Brand Harris” article where he said “The good news: The Biden economy has a lot to celebrate. Impressive job growth….The VP needs to come armed with receipts re: job creation and growth”
Then it turned out those job numbers were totally fake.
818,000 jobs that the Biden-Harris admin claims to have created do not exist.
It’s the largest downward revision in 15 years.
Fake.Fraudulent. Counterfeit numbers.
I don’t recall Galloway ever even acknowledging those fake numbers or updating that article.
We’re all human, we all make mistakes, but how a person handles their mistakes says a lot about their character.
Years from now, will Galloway ever admit if he got it wrong about anything having to do with Trump or his policies?
No. He’s as much an idealogue as Maxine Waters and often as smart.
Take it from someone who lives in a country that is considered a close US ally, confidence in America is very low.
The Europeans and Asian countries are doing FTAs that do not involve the US, you are being side-lined.
The combination of Trump and US Government debt means the rest of us are running for cover, we are building alliances so that when the US goes down, we do not collapse with you.
By the time Trump leaves office, the world will not need America.
The USA just had it’s credit rating drop for the first time in a century. Who ushered that in?
No argument at all on the need to reform our medical ans insurance systems to reduce cost, eliminate waste amd improve outcomes.
But that is hardly the only big win sitting there for the taking by adults, if we can find them, in our Congress. Simply enforcing already existing tax laws would yield something like $600B to $2T in annual revenue. That would likewise go a long way towards closing the fiscal gap. Yes, instead, our genius President and his lackeys (or overseers, hard to tell) would orefer to gut the IRS and forego this win.
Pretty much tells you everything you need to know about the true motives of the “party of fiscal responsibility”.
Hard not to agree with most of what you say here. The folks who need to go are spineless congressional reps. Ongoing affordable healthcare is really wellthcare. Staying healthy, getting healthier if health impaired and so on. This is as much a supply chain problem as anything else and it is fixable.
Reality check for medical—-I’m a U.S. citizen living in LatAm. There is a public health care system, but it’s not very good, so anyone that can afford it buys into the private system, which I did. I just had prostate surgery—-first class all the way—-tests and prep, hospital, nurses, surgeon and admin. All-in quoted price was $5500 and I mean everything; no surprises. At the end of my one month followup visit with the doc, he hugged me and said it was his pleasure to have served me. And like every doc I’ve seen here, I have his personal cell number in case I need anything.
Similar to what I have heard from expats on the “Retire There” podcast. Most are amazed that the level of care is as good or better than they got in the US with the cost being a small percentage of what they paid.
We need to end once and for all trickle down economics and that fail giveaway to the rich. We also need to tax the seriously wealthy at reasonable rates with no loopholes. Start at people making 50 million a year. No wealth tax. That’s too complex. Scott’s idea of paying the president $10mm is naive. No one would believe there would be zero tolerance on grift. Naive at best. Leave social security/medicade/care alone, but remove the pay in limit and means test the payout. People with assets over $100,000,000 get no social security. Yea, I know, it sucks to be them. Remove tax exemptions on universities with $4B in endowment. And religious institutions that pay pastors more than X amount of money. Eliminate tax exemption from Scientology and Mormons, if only to reestablish that we are not fucking idiots to believe their bullshit are religions.
Both parties have been horrific on the debt. SG would have more credibility if he would realize both camps are corrupt w the only goal to secure and keep power.
Bill Clinton had a balanced budget. Republicans believe in trickle down economics, which is just tinkle on the poor economics. Democrats gotta stop talking about minorities and just talk about people.
Two thoughts. 1. What impact does the legal system have on medical costs in the US? How many unnecessary tests are done to protect the medical professionals from potential litigation. Does it make sense that a heart surgeon might have to cover an insurance premium running to $100,000s each year (spoiler alert we pay not him). 2. With such an expensive system why are there not more disruptirs entering the market (spoiler damn I forgot my first point).
Niall Ferguson comment on the relationship of the defense budget & debt has no basis. The rise in the debt has a lot to do with the dramatic increase in the Fed rate from 1% to 5% since Trump was elected in 2016. Japan’s debt to GDP is 250% & no one expects it to turn into Greece or Argentina. Wasn’t there wailing & hand wringing when the deficit hit $10T, & then at $20T? We seemed to have survived that. It’s the annual deficit as a percentage of GDP that matters. Remember unlike an individual, the government always has a source of income. It’s the management of the income that matters, not the balance of receipts.
Make it 100% increase in taxes on the 1% highest incomes and you save more than 6% in a year. Just keep it going AND (very dangerous though) don’t start spending what you save. Medical spending has to keep going to 0% and ideally get negative – if one can lower costs of drugs, than why not be able to cut cost on doctors? They earn on average (so a lot do not) much more than any doctors on the planet. Stop letting them. Cut them from any payback it they want to earn too much (above 7 figures to start with?) and then tax them at 50% on what they earn (no subtractions!). All this would start lowering the debt which is just too big to be sustained and MAGA (actually let America stay great).
As an American trained, licensed medical doctor and surgeon, I’ve always wanted to get paid less for the services I provide. Just don’t blame, sue, shame me into believing it’s my fault when your outcome doesn’t match your expectations. Shit happens when your group practice says your paycheck equals RVU/FTE.
Scott can’t write a paragraph without blasting Trump….SAD
Destroying Trump is Galloway’s religion.
Galloway would rather America fail than have Trump succeed.
At a certain point people have to ask themselves, what is the real reason people are a part of this TDS cult?
While every point in this piece is spot on and needs to be addressed, the other point not made but needs equal, if not greater exposure, is that people have a lot more agency to influence their personal health and thus significant savings to their personal healthcare costs and, collectively to national programs. Fixing the problem starts here but it requires people to think, act and have agency over their health which our convenience laden world prevents.
as someone who is successfully working on the other end of Health & Human Performance (though I am considered an outsider in the institutional sense),
I went to Catholic schools in the 1960s and we had PE, fairly rigorous PE. I had no problem getting into a military academy.
During WWII, more than 95% of inductees were physically fit sufficiently to serve.
In Vietnam that number was about 65%.
Today that number is about 15%.
Almost no schools have PE class today.
Bad health is the result of bad health habits, bad nutrition, and no exercise. Adults are letting kids get away with these bad habits.
It isn’t hard to understand. You don’t need a bloody PhD.
I’m in my mid 70s. I workout 3 times a week — OK I do spend 2 hours, but you can get by with 30 minutes — and walk the other days, 5 miles at low tide on the beach.
Next time you are walking in a major city take a look at the people and muse on their health.
We just need to a nation of adults.
The Universities also share billions of dollars in the revenue from the development of drugs funded by the government. The price negotiation starts at the university from their patent.
Here is the development of drug works: In most cases, the government gives grants to medical researchers at universities to fund the development of a new drug. Next, the new drug is tested and approved by the FDA, and finally it is licensed to the Pharmaceutical Industry who proceeds to market and distribute it to the public based on individual medical needs. Revenue from drug sales is shared by the medical researcher, the university where it was developed and the pharmaceutical company. It’s not unusual for a medical researcher to become wealthy and the universities to get billions of dollars because of the revenue-sharing from drug patents. What does the government get back for its taxpayer-funded investment? Absolutely nothing.
FYI PACASO is not found by ‘PCSO’ If I search by the full name news on the company, but no trade ticker symbol. That said it seems that the company is not publicly traded.
Excellent points!
“Why isn’t the largest purchaser of pharmaceuticals on the planet able to negotiate costs — like everyone else”… ask former congressman Billy Tauzin, turned chief lobbyist for PhRMA or read “Remedy and Reaction” by Paul Starr. TLDR: REGULATORY CAPTURE, basically PhRMA wrote the legislation that mandated that Medicare can’t negotiate drug prices.
Next, remember that one person’s healthcare expense is another person’s revenue. US Healthcare is the largest employer in 49 out of 50 states…so the largest US jobs program in history. You decrease the spend, then you decrease jobs which tends to make Presidents and members of Congress even more unpopular than they already are which is quite an accomplishment.
Technology never reduces healthcare spend. We develop a great deal of technology in this country, but it all has hidden costs. For example, the electronic medical record (EMR) which was forced on the healthcare system in the HITECH Act. Now that we have an EMR, there are innumerable costs associated with it, such as IT support, cybersecurity analysts or insurance, compliance reporting, etc. These all come with a cost. In the current era, a bad actor on another continent can steal 10 million healthcare records in a matter of minutes. Before the EMR, it would take 500 tractor trailers filled to the brim to steal 10 million paper charts…which would equate to a line of semi-trucks 4 miles long if that helps to visualize it.
Transparency won’t work. Transparency works with industries in general, but healthcare is not an industry. It’s an amalgamation of many industries. And none of these folks sit around tables talking about how to lower the cost of healthcare. Hospitals already post their prices online for procedures. No one looks at this stuff, save insurance companies. So, the only thing people shop for when it comes to healthcare in general is…insurance.
Want a partial solution? Allow national health plans. Then have those plans owned by the covered individuals, so they are portable if they move jobs or states. This will create a better alignment of interest where insurance companies would care about the healthy lifestyles of their covered lives. (You’d have to have the covered individuals protected from having policies cancelled.) But the chances of this happening are remote. Right now, we don’t actually own our own portable insurance until we’re on Medicare. So, the easier political solution may be to make that an option.
One more note. I imagine you have a living will and a durable medical power of attorney. Most rich people do. They want to have some say about their quality of life at the end of life. Unfortunately, most people do not have such documents. The result is that the US also spends a comparative fortune on end-of-life care. It would be both compassionate and fiscally smart if we compelled all Medicare enrollees to have such documents.
Just here to remind all that after World War II under President Eisenhour the maximum marginal income tax rate was 91%. Probably nobody paid that due to deductions, but income taxes were substantially higher to pay for the cost of the war. The lies from the Republican Party over decades about how cutting taxes will trickle down to benefit everyone has created much of the debt, accompanied by President George W. Bush’s wars in Iraq and Afghanistan, while he cut taxes further thus incurring more debt. Unfortunately income taxes must increase, and also taxes on estates larger than a specified amount. Should also tax capital gains as income. It will take a long time to correct the problem, but the problem didn’t happen overnight.
I dont get why you are looking for side solutions like transparency when the obvious solution is to make the life saving healthcare system, non profit. There are many countries that do it, with much lower costs and by far better outcomes in every measure.
For example, in Israel we have 4 non profit organizations that compete between them, but they dont control the costs only their level of service. They mush insure everyone while getting most of their funding from the government (taxes) and small payments once a quarter for some. Drugs are also massively subsidized, with a cap, if its given by subscription and because the Dr is not profiting from it, there is no problem of subscriptions that are given for benefits from the drug companies.
Drug prices are crazy. Yes 91% of drugs taken are generic – but that’s an analysis per pill, not by cost. The top 20 drugs are an enormous percentage of overall drug costs. Drugs for cancer, MS etc are wonders – but many came out a decade or more ago and yet still raise prices 7-15% per year. When they came out they priced them at a level they assumed would turn a good profit. so why/how are they allowed to keep jacking up the prices. Biogen’s drugs for MS are 10x more expensive than they were 20 years ago. And additional filings and tweaks allow them to extend the patents – which is bogus !!
Easy fix – demand that the US pay the avg price of UK, Germany, Australia and Canada – all DM nations with similar demographics.
Much of the commentary and perspective in tis post makes a hugely erroneous assumption by ignoring a fundamental fact that is not, and likely will not, be addressed. That would be the fact that intentional and programmed inflation in the defense, education and health care sectors will continue to sabotage any meaningful policy proposals to that will result in total ineffectiveness. Colleges, hospitals and defense contractors are going to serve stockholders and stakeholders at all costs, public be damned. It would appear we have to bottom out and crash a few vital sectors to oblivion before broad acceptance of corrective action is possible.
I am surprised that you don’t know how Pharma works.
The quagmire of Big Pharma has been designed to keep Americans in the dark when it comes to pricing of drugs, the multiple players involved in development, and the minefield of pricing for the consuming public. It is no wonder that American consumers often feel they are at the mercy of an overbearing pharmaceutical industry.
The NIH supports over 300,000 medical researchers at many Universities with grants at a cost of $40 billion dollars per year. Many of these universities have large billion-dollar foundations and could fund these themselves.
Here is how it works: In most cases, the government gives grants to medical researchers at universities to fund the development of a new drug. Next, the new drug is tested and approved by the FDA, and finally it is licensed to the Pharmaceutical Industry who proceeds to market and distribute it to the public based on individual medical needs. Revenue from drug sales is shared by the medical researcher, the university where it was developed and the pharmaceutical company.of What does the government get back for its taxpayer-funded investment? Absolutely nothing.
The new drug’s price also comes with a 20-year monopoly during which the drug company can charge any price. The cost of a new drug to the consumer has no relationship to the actual cost of its research and development, nor to its efficacy.