2014 Healthcare Apocalypse

[Sandy MacNab]

I'm guessing heavy regulations.

I understand they introduced a bit of competition into their system as well as have the "money follow the procedure". Hospitals compete with each other to provide services and are under contract to the national health service which provides 100% of the funding. For example, a hospital is contracted to do gall-bladder surgery at X Euros per procedure and is paid the X Euros only if it performs such a procedure. No surgeries no Euros. Thus a hospital has an incentive to work efficiently in order to earn a living for its staff. I also understand there are bonuses and other incentives for patient satisfaction and other objective criteria.

I don't know what other provinces do, but Alberta hospitals get block funding which, if you look at it, discourages them from any services.

[Sandy MacNab]

We need to control costs...unfortunately, no country has managed to do that, whether their system is public, private, or hybrid. There is no real solution right now. We just have to decide how we want to pay for the increases (out of pocket, through insurance premiums, or through taxes). Right now, with the advances in technology and the rise in drug prices, along with the aging population, there isn't much to be done. We can make things more efficient, we can open up more private delivery, but even if that saves some, it will be but a drop in the bucket.

I think there are a fair number of European countries, notably a couple very socialist Scandanavian countries, that have public/private hybrids that are working very well. Their wait times are much less than Alberta's and their costs are also much lower. The Fraser Institute has done a lot of research into this and has a number of very interesting publications.

[Smallc]

I think there are a fair number of European countries, notably a couple very socialist Scandanavian countries, that have public/private hybrids that are working very well.

But costs are still spiraling out of control. It's about the cost of medication more than anything.

[Sandy MacNab]

But costs are still spiraling out of control. It's about the cost of medication more than anything.

I think that might be because the drug companies haven't enough competition or have a much too powerful lobby. I don't really see that as a fault of the "systems" per se.

[Smallc]

I think that might be because the drug companies haven't enough competition or have a much too powerful lobby. I don't really see that as a fault of the "systems" per se.

It's not a fault of any system. Every system has costs that are increasing too fast to one degree or another, and almost all of the increase can be attributed to drugs.

[TimG]

I think that might be because the drug companies haven't enough competition or have a much too powerful lobby. I don't really see that as a fault of the "systems" per se.

We already have a problem where drug companies are simply refusing to invest in research for drugs that affect poor or small populations because they can't make enough money to recover their R&D costs. No amount of grandstanding by politicians is going to change these economic realities.

The solution is this: if a drug did not exist and people died then people accepted the result. People need to learn that just because a drug exists that does not automatically mean that it should be provided for free. Not getting the drug simply means they are no worse off than they were 10 years ago. Such a position is acceptable for any other industry. Why not healthcare?

Lowering people's expectations for healthcare is tough to do but it is the only way to get costs under control.

Edited May 4, 2011 by TimG

[kimmy]

I'm confused. What is the "2014 Healthcare Apocalypse"? Is that when Paul Martin's "I saved healthcare for a generation" deal ends? Did the Mayans predict this and carve it on a stone calendar? What are we actually talking about?

-k

[RNG]

I understand they introduced a bit of competition into their system as well as have the "money follow the procedure". Hospitals compete with each other to provide services and are under contract to the national health service which provides 100% of the funding. For example, a hospital is contracted to do gall-bladder surgery at X Euros per procedure and is paid the X Euros only if it performs such a procedure. No surgeries no Euros. Thus a hospital has an incentive to work efficiently in order to earn a living for its staff. I also understand there are bonuses and other incentives for patient satisfaction and other objective criteria.

I don't know what other provinces do, but Alberta hospitals get block funding which, if you look at it, discourages them from any services.

Finally, someone who understands. Add in the unions and there is trouble in River City. With a capital T.

[Bonam]

We already have a problem where drug companies are simply refusing to invest in research for drugs that affect poor or small populations because they can't make enough money to recover their R&D costs. No amount of grandstanding by politicians is going to change these economic realities.

Of course a big reason why R&D costs are so high to begin with is because medical R&D has to go through procedures mandated by government that drastically inflate the costs. The delays, approval processes, multiple study requirements, etc, all are a big factor. Politicians certainly have the power to review some of these requirements with an eye towards reducing medical R&D costs. Unfortunately, no one wants to be the guy that softened these procedures when an inevitable controversy happens.

The solution is this: if a drug did not exist and people died then people accepted the result. People need to learn that just because a drug exists that does not automatically mean that it should be provided for free. Not getting the drug simply means they are no worse off than they were 10 years ago. Such a position is acceptable for any other industry. Why not healthcare?

Whether free or not, if a certain drug or procedure exists, people should be able to access it. In Canada, if they are not allowed to be charged for it because of some stupid law, then it must be provided for free. Withholding a life saving treatment is a death sentence.

Lowering people's expectations for healthcare is tough to do but it is the only way to get costs under control.

I can and do expect that should I require novel healthcare, the best possible means to keep me optimally healthy will be used. Whether this is covered by some public plan or by me paying out of pocket is a secondary consideration. I would categorically and firmly refuse to lower any such expectation. Our society is not advancing in technology just so we can stop using cutting edge medical tools.

[dre]

Of course a big reason why R&D costs are so high to begin with is because medical R&D has to go through procedures mandated by government that drastically inflate the costs. The delays, approval processes, multiple study requirements, etc, all are a big factor. Politicians certainly have the power to review some of these requirements with an eye towards reducing medical R&D costs. Unfortunately, no one wants to be the guy that softened these procedures when an inevitable controversy happens.

Whether free or not, if a certain drug or procedure exists, people should be able to access it. In Canada, if they are not allowed to be charged for it because of some stupid law, then it must be provided for free. Withholding a life saving treatment is a death sentence.

I can and do expect that should I require novel healthcare, the best possible means to keep me optimally healthy will be used. Whether this is covered by some public plan or by me paying out of pocket is a secondary consideration. I would categorically and firmly refuse to lower any such expectation. Our society is not advancing in technology just so we can stop using cutting edge medical tools.

Of course a big reason why R&D costs are so high to begin with is because medical R&D has to go through procedures mandated by government that drastically inflate the costs.

Thats true, theres hoops to jump through. But dont forget that in addition to setting up these hoops the government guarantees these companies protection from comptetitors who could easily reverse engineer their products and sell knock-offs. They also give these companies r&d grants and turn over intellectual property to them constantly.

The Pharmy companies have a pretty sweet deal and its one of the most lucrative industries on the planet.

I can and do expect that should I require novel healthcare, the best possible means to keep me optimally healthy will be used. Whether this is covered by some public plan or by me paying out of pocket is a secondary consideration. I would categorically and firmly refuse to lower any such expectation. Our society is not advancing in technology just so we can stop using cutting edge medical tools.

Well... you dont have to lower your expectations. Canada has a public UHC system that does a relatively good job providing care to the general populous but falls behind in their capacity to deliver on certain services. But you can shop for these services in a number of other countries if you need them.

Edited May 4, 2011 by dre

[Bonam]

Thats true, theres hoops to jump through. But dont forget that in addition to setting up these hoops the government guarantees these companies protection from comptetitors who could easily reverse engineer their products and sell knock-offs. They also give these companies r&d grants and turn over intellectual property to them constantly.

The Pharmy companies have a pretty sweet deal and its one of the most lucrative industries on the planet.

The industry is lucrative as a whole, sure. But from a company's point of view, each project they can potentially invest in has to be judged on an individual basis, whether it will be worthwhile or not, and not just whether it will be worthwhile on its own, but in comparison to other things they could invest in (opportunity cost). And obstacles in the way of making R&D pay off in a reasonable time frame certainly will slow/reduce R&D investment.

Well... you dont have to lower your expectations. Canada has a public UHC system that does a relatively good job providing care to the general populous but falls behind in their capacity to deliver on certain services. But you can shop for these services in a number of other countries if you need them.

Yes... but it would be nice to be able to shop for those services in Canada.

[dre]

The industry is lucrative as a whole, sure. But from a company's point of view, each project they can potentially invest in has to be judged on an individual basis, whether it will be worthwhile or not, and not just whether it will be worthwhile on its own, but in comparison to other things they could invest in (opportunity cost). And obstacles in the way of making R&D pay off in a reasonable time frame certainly will slow/reduce R&D investment.

Yes... but it would be nice to be able to shop for those services in Canada.

Yes... but it would be nice to be able to shop for those services in Canada.

Well... thats debatable and depends on your perspective.

Edited May 4, 2011 by dre

[blueblood]

The industry is lucrative as a whole, sure. But from a company's point of view, each project they can potentially invest in has to be judged on an individual basis, whether it will be worthwhile or not, and not just whether it will be worthwhile on its own, but in comparison to other things they could invest in (opportunity cost). And obstacles in the way of making R&D pay off in a reasonable time frame certainly will slow/reduce R&D investment.

Yes... but it would be nice to be able to shop for those services in Canada.

You are forgetting to add that when these drugs come off patent, the costs to consumer drop like a rock, which is good for the consumer and bad for the r and d department and meeting obligations to investors. If any of the centre left has been watching bnn as of late, pharma companies aren't doing well because of this.

Also to note that at the start of the r&d process, most drugs don't make it onto the store shelves. A lot simply don't pan out. And those that do, some of them aren't hits with consumers either. Its an expensive process and drugs are priced accordingly.

[TimG]

Well... thats debatable and depends on your perspective.

Maybe if you are a health care union rep looking to protect your monopoly it might be bad. There is no excuse for preventing people from buying services. Every other country in the world does it.

[BornAlbertan]

So doctors are all crooks now?

You should tell the one giving you your next colonoscopy that.

Did I say that?

[Sulaco]

How would you know?

I join in that question. I should add I have many friends across several states who practice, some as PDs or equivalents, others as private attorneys. And all, coming from the trenches, would disagree with your view, some would in fact be deeply insulted.

But hey, if you form your opinion based on media portrayals of outlier cases - well I suggest you don't come into the practice of law with that approach to method and analysis.

Edited May 4, 2011 by Sulaco

[Sulaco]

Percentage of cases, degrees, and credentials.

Florida, Pennsylvania, Arizona, Nebraska/Iowa, and Indiana/Kentucky

Wha does "percentage of cases" mean?

Degrees and credentials are emaningless. Most criminal defense aorneys, private of public, come from lesser schools or come out of top tier schools with crap grades. Something about that maverick personality that a criminal defense attorney should carry, comes out in education.

I exclude elite white colar crim law firms from this. But what they practice is more akin to corporate law.

but we digress. I return to my point, however, the flagship example you chose does not prove that which you hoped it would. In fact the existence of a private tier may improve the provision of publicly funded services to the indigent. I would posit same is true in American hospitals, where indigents benefit from subsidies paid by insured and/or wealthy clients.

Heck I would argue Canada benefits from the fact that Americans pay the prices they pay - but that's another story.

Edited May 4, 2011 by Sulaco

[Scotty]

Of course a big reason why R&D costs are so high to begin with is because medical R&D has to go through procedures mandated by government that drastically inflate the costs. The delays, approval processes, multiple study requirements, etc, all are a big factor. Politicians certainly have the power to review some of these requirements with an eye towards reducing medical R&D costs. Unfortunately, no one wants to be the guy that softened these procedures when an inevitable controversy happens.

I am given to understand that virtually all the costs of research and development are covered by government funding anyway. Is that not the case?

[TimG]

I am given to understand that virtually all the costs of research and development are covered by government funding anyway. Is that not the case?

Not at all. There may be cases where research is conducted at a government funded university but the money still comes from the companys.

[Topaz]

I have no problem with private health care for those who can afford it BUT, it has to be completely separate and funded on its own and this would easy the burden on provinces budget. Now, I read that firewall letter Harper wrote to the Premier of Alberta and unless he has changed his mind, Harper wants the provinces to raise its own money for health care, with some help from the Feds. I don't think that would go over with people. I guess Canadians should really start living better lives but with food prices going up again,only the people making really good money will be able to do that. When it comes down to it, its up to us to try and eat healthier, and take better care, the hospitals to run a better ship and cut waste where they can, and maybe look at the pro and cons of the two-tier system, but not funding by government.

[Scotty]

Also to note that at the start of the r&d process, most drugs don't make it onto the store shelves. A lot simply don't pan out. And those that do, some of them aren't hits with consumers either. Its an expensive process and drugs are priced accordingly.

But while the rhetoric is stirring, it has very little to do with reality. First, research and development (R&D) is a relatively small part of the budgets of the big drug companies—dwarfed by their vast expenditures on marketing and administration, and smaller even than profits...

Second, the pharmaceutical industry is not especially innovative. As hard as it is to believe, only a handful of truly important drugs have been brought to market in recent years, and they were mostly based on taxpayer-funded research at academic institutions, small biotechnology companies, or the National Institutes of Health (NIH). The great majority of “new” drugs are not new at all but merely variations of older drugs already on the market. These are called “me-too” drugs. The idea is to grab a share of an established, lucrative market by producing something very similar to a top-selling drug.

The Truth About Drug Companies

[Scotty]

Not at all. There may be cases where research is conducted at a government funded university but the money still comes from the companys.

Not quite true. In point of fact, most of the original research is government funded. The drug companies then take information from that, and do their own research - which is tax deductible, by the way.

And for the most part, they invent very little in the way of actual new drugs. The industry mostly produces 'new' drugs which are only minor variations of those already on the market. They're not there to improve anything, just to allow them to grab a share of an existing market.

[RNG]

Not quite true. In point of fact, most of the original research is government funded. The drug companies then take information from that, and do their own research - which is tax deductible, by the way.

And for the most part, they invent very little in the way of actual new drugs. The industry mostly produces 'new' drugs which are only minor variations of those already on the market. They're not there to improve anything, just to allow them to grab a share of an existing market.

I can't speak for all universities, but I do know about the U of Alberta. A long time ago they set up a business unit. The pharmacology industry doesn't mess with them anymore.