Re: What is the root cause of the rising cost of health care ?
- From: royls@xxxxxxxxx
- Date: Mon, 03 Sep 2007 18:29:16 GMT
On Sat, 1 Sep 2007 11:51:03 -0500, "Peter Olcott"
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On Wed, 29 Aug 2007 19:00:56 -0500, "Peter Olcott"
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On Mon, 27 Aug 2007 18:16:40 -0500, "Peter Olcott"
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You completely ignored my example about Nexium didn't
you?
Yes, because it did not mean what you thought it
meant.
Nexium is much more expensive than Prilosec, yet
because
of
the subsidy of health insurance Nexium is cheaper for
me
than Prilosec, so I choose Nexium.
That has nothing to do with demand being unconstrained
by
price. It's
Sure it does. My demand for Nexium only exists because I
don't have to actually pay the price myself directly.
No. Your demand for Nexium or an equivalent product
exists because
you need it. Inelastic demand is a characteristic of
medical goods
and services, but that is not what makes them expensive,
as the low
price of Prilosec proves (and if Prilosec is equivalent,
I don't know
why your insurance would make Nexium cheaper). What you
are missing
is _why_ Nexium is much more expensive than Prilosec.
What allows the
manufacturer to charge so much more for it?
The fact that it is cheaper than alternatives for people
with insurance is what allows manufacturers to charge the
much higher price. If health insurance did not exist, and
LOL!
That might be a contributory factor, but it's dwarfed by
the restriction in supply created by patent protection.
The next best alternative to Nexium is Prilosec. The patent
on Prilosec has expired to it is now in the public domain. I
don't buy Prilosec because (with the subsidy of health
insurance) Nexium is cheaper.
You continue to claim that, but you haven't explained how it is
possible. Does your insurance pay only for patented drugs, not for
unpatented drugs?
How can you be posting to a group named sci.econ and not
be aware of such a simple fact?
As I just pointed out the simple fact does not apply.
Yes, of course it does. You just refuse to know it.
The
alternative to the patent protected Nexium no longer has
patent protection. It is not the patent protection that
causes the high price, it is the fact that expensive Nexium
is cheaper than its alternative for people with health
insurance.
Oh, try not to be so stupid for a change, will you? What stops other
companies from making Nexium available at a lower price, thus winning
customers away from the patent holder?
The root cause of the rising cost of heath care is that the
subsidy of health insurance causes very wasteful allocation
of scarce resources
You still haven't explained why your rational health insurance company
will pay for Nexium but not for the far cheaper Prilosec. Until you
provide some support for that claim, it is safe for readers to assume
that you are either mistaken or lying.
when the rational health care consumer
and the rational health care provider both seek to maximize
their own benefit.
You again merely prove your ignorance. A major problem with health
care costs is that the rational consumers do not exist, because
consumption decisions are often effectively made by the providers.
-- Roy L
.
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