Re: What is the root cause of the rising cost of health care ?


<royls@xxxxxxxxx> wrote in message
news:46dc2643.4265575@xxxxxxxxxxxxxxxxx
On Sat, 1 Sep 2007 11:51:03 -0500, "Peter Olcott"
<NoSpam@xxxxxxxxxxxxx> wrote:

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?

My insurance will pay for prescription drugs, they will not
pay for non prescription drugs. Prilosec is now a non
prescription drug, and costs about $50.00 for a months
supply. Nexium only cost me, $40.00 co-pay for a months
supply.


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.

Partly because they are a bureaucracy, and thus very
resistant to change, and partly because they are in bed with
the health care industry, and partly because it doesn't
really cost them anything, they simply raise their rates.


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.

The incentives for making efficient health care choices are
either entirely missing, woefully insufficient, or in some
cases (such as Nexium and Prilosec) completely backwards.


-- Roy L


.

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