Can a Doctor's Office Charge Much More Than Another?

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In summary: I had a friend that had serious medical issues so was constantly in the hospital and getting crazy bills, and he had quite a bit of luck pushing back on the more egregious charges.
  • #1
kyphysics
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Quick question for you experienced "older people" :wink: (sorry, I couldn't word it in any better way - I think of it as a compliment of sorts in terms of acquired wisdom over me!):

i.) What I mean is, can two doctor's of the same specialization (pick any...say, dermatology) charged wildly different rates for the SAME things? By "wildly," I mean like around double or more.

ii.) Can two doctor's of different specializations charge wildly different rates for the "SAME" things (e.g., initial evaluation, physical exam, etc.)? Obv., they specialize in different things, but I mean the same "category" of things like say a routine initial evaluation and trouble-shooting of symptoms, where they ask your background, what's bothering you, and try to diagnose you.

Why do I ask? Duuuuuuude!

re: i.) I went to a physical therapist in 2017 and was charged $360 for my initial eval. and first session of therapy and to a different physical therapist in 2018 (different problem) and was charged $625 for my initial eval. and first session of first therapy (they typically combine these two into one meeting). I'm like WHAAAAATTTTTT? Inflation can't be THAT bad. Same freakin' procedures. Ask me a bunch of questions, stretch me out, test my reflexes, tell me what program they want to put me on, and then do a single session of physical therapy (no way in hell I'm going back to that 2018 PT office!).

But one PT practice was almost 2x the other.

re: ii.) Have seen tons of doctors over the past few years for routine and non-routine stuff (you name it - back doctor, colon doctor, nose/ear/throat doctor, dermatology, etc.)...The initial eval. is typically around $140-$200. Same stuff...ask me stuff and try to diagnose me. Went to a rectal doctor (don't ask!) very recently and was charged freakin' $325 for a 10-15 minute initial eval.

I'm thinking WHATTTTTTTT?

I guess my question is, is this normal? Should I expect medical billing fraud (and can I complain and say: "Why are you charging me freakin' so much compared to everyone else?") or is this just legal in the medical profession like how Five Guys burgers charges $X for a cheeseburger and Shake Shack charges $Y?

(p.s. Those are the billed rates by the way. My insurance company contractually adjusts them slightly, so I have to pay slightly less...but STILL! It's a lot! Like that $325 bill is now $275, but for 15 minutes and kind of a rude doctor too...and way more than other doctors for same category of visit... I'm pretty ticked off!)

Appreciate any thoughts people might have.
 
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  • #2
If you are in the US then yes, prices can be all over the map. I have certainly seen things like this. For example, the cost of an MRI or x-ray can vary by more than a factor of 2 where we live. I cannot claim to understand the finances of the medical industry, but the reality is that it is our one big expense where we don't shop based on price at all. In fact, it isn't always easy to find out up-front how much something will cost.

Note that you can always call the hospital to discuss the charges and see if you can get them reduced. I had a friend that had serious medical issues so was constantly in the hospital and getting crazy bills, and he had quite a bit of luck pushing back on the more egregious charges. You probably have nothing to lose by trying!

good luck,

jason
 
  • #3
(p.p.s. I guess one general question I have is do specialists typically cost more than a general practice doctor? And do certain types of specialists cost more than other specialists for the same category of visit. Never seen a rectal doctor before and NEVER hope to see another one!... But, yeah, they charged me way more for that basic initial eval. (literally 10-15 minutes and I'm out of there) than any other specialist I've ever seen...even for longer visits too with them.)
 
  • #4
jasonRF said:
If you are in the US then yes, prices can be all over the map. I have certainly seen things like this. For example, the cost of an MRI or x-ray can vary by more than a factor of 2 where we live. I cannot claim to understand the finances of the medical industry, but the reality is that it is our one big expense where we don't shop based on price at all. In fact, it isn't always easy to find out up-front how much something will cost.

Note that you can always call the hospital to discuss the charges and see if you can get them reduced. I had a friend that had serious medical issues so was constantly in the hospital and getting crazy bills, and he had quite a bit of luck pushing back on the more egregious charges. You probably have nothing to lose by trying!

good luck,

jason

Yeah, I never thought about asking UPFRONT what they'd charge. I guess I figured it'd be the same or relatively the same as everyone else in the area. I'm talking the SAME city here, not like me going to one doctor in Manhattan/San Francisco, etc. (high COL) vs. a small rural town. These instances I mentioned are for the exact same city.

I guess my question is when can it ever get "TOO" high of a price to be practically or literally medical billing fraud and price gouging someone?

To take an extreme, obviously, a basic initial eval. that lasts 10-15 min. like with my rectal doctor SHOULDN'T cost $3,000. But, say, if he just charges $150...$200...$300 more...at those points, is it legal? Is it fair? Is it pointless to try to fight back?

I get that Five Guys can charge double what McDonald's does or even triple if they wanted to. They can say they have gourmet burgers or what have you and they taste better, etc. But a person doesn't have to eat burgers. OTOH, a human HAS to see doctors when they get sick. So, I feel like you're at their mercy then, no? I just always assumed doctors charged roughly the same with maybe some super nice office facilities charging more, because of the nice building and what not (btw, the rectal doctor's office was SUPERRRR crummmyy...so old another patient remarked on it when I was entering and we were in the same elevator, which made me suspect he was broke and charging ANYONE who sees him crazy $$ to stay afloat in a really rundown office building).

Is there a legal "breaking point" with charges? It's definitely weird to NOT KNOW what you're going to pay when you go to a doctor.

If I go to McD's, I KNOW what their burger costs and the same with In-N-Out. I can buy based on that beforehand.

What the heck with doctors? They can just not list their prices? This is the first, though, that I've had a wildly out of proportion bill. I've always seen doctors in the past who charged roughly the same. This past year has been crazy!
 
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  • #5
I agree that it can be nutty, but I don't have any answers for your questions. The medical industry is definitely one in which the free market does not function at all ...

jason
 
  • #6
jasonRF said:
I agree that it can be nutty, but I don't have any answers for your questions. The medical industry is definitely one in which the free market does not function at all ...
jason

Well, if there's at least SOME competition, that means we can inform each other of the cheaper doctors in town. I plan to write a review online of these two places I mentioned above and their costs. I wish I had known earlier!

Maybe I can warn others away...

Thanks for the thoughts, though!
 
  • #7
kyphysics said:
i.) What I mean is, can two doctor's of the same specialization (pick any...say, dermatology) charged wildly different rates for the SAME things? By "wildly," I mean like around double or more.

ii.) Can two doctor's of different specializations charge wildly different rates for the "SAME" things (e.g., initial evaluation, physical exam, etc.)? Obv., they specialize in different things, but I mean the same "category" of things like say a routine initial evaluation and trouble-shooting of symptoms, where they ask your background, what's bothering you, and try to diagnose you.
Yes, of course. Go to a high end shoe store and a department store and compare similar looking pairs of shoes. One might cost 10x more than the other even though they are very similar. Heck, go to a grocery store and look at the bottles of olive oil, sitting right next to each other on the shelf, with vastly different prices!
I guess my question is, is this normal?
Yes, it is normal. It's capitalism with the brakes removed. Service providers charge whatever people will pay for their services that enables them to reap the most profit. Now what makes medical costs different than picking olive oil at the grocery store is that for some reason, as you demonstrate, people assume all medical services are identical and should therefore have identical prices (and worse, don't even bother checking!). I can't fathom why people think that way, but you are not alone in it. At the grocery store, people will see the more expensive olive oil and assume it is better (and it may or may not be).
Yeah, I never thought about asking UPFRONT what they'd charge.
And that is a huge part of the reason why medical costs are so high in the US. Can you imagine: "Hi, Mr. Car dealer: I'd like that car over there. No, I don't care what it costs."(!)
 
  • #8
russ_watters said:
Yes, of course. Go to a high end shoe store and a department store and compare similar looking pairs of shoes. One might cost 10x more than the other even though they are very similar. Heck, go to a grocery store and look at the bottles of olive oil, sitting right next to each other on the shelf, with vastly different prices!

Yes, it is normal. It's capitalism with the brakes removed. Service providers charge whatever people will pay for their services that enables them to reap the most profit. Now what makes medical costs different than picking olive oil at the grocery store is that for some reason, as you demonstrate, people assume all medical services are identical and should therefore have identical prices (and worse, don't even bother checking!). I can't fathom why people think that way, but you are not alone in it. At the grocery store, people will see the more expensive olive oil and assume it is better (and it may or may not be).

And that is a huge part of the reason why medical costs are so high in the US. Can you imagine: "Hi, Mr. Car dealer: I'd like that car over there. No, I don't care what it costs."(!)

Yeah, massive lesson learned!

Not even my parents warned me about this. Although, it's my fault too. ...Just that they usually tell me things to be careful of. ...Sucks for them, since they'll be paying a few hundred bucks to help me out. I'm scared to even tell them about the bills.

Had no personal experience with this, but now I'll be asking every freakin' doctor before I got to them what they charge (assuming they can even tell me).

One last question, is there ANY charge amount that we can sort of push back on and start saying it's too ridiculous and medical billing fraud? Or, would they just say: "Nope, you had the responsibility of asking how much it was first."?

I haven't gotten my insurance's Explanation of Benefits yet for that physical therapy $625 charge, but if the adjustments are anywhere near what is was for the rectal doctor, then I'll still owe upper $400's to lower $500's I'm guessing. And that's a lot!

Or, does that sound like a reasonable range before it's just medical fraud...I'm assuming there's SOME range where it's so ridiculous that I could just say you're cheating me?? Say...$1,500 for that hour's time?

*sorry for the rant...was just building up some steam with saving up some cash and now this stupid thing happens*
 
  • #9
Where was the Dave Ramsey episode warning me of stupid financial mistakes people make on this topic? :rolleyes:
 
  • #10
kyphysics said:
Yeah, massive lesson learned!

Not even my parents warned me about this.
That's not entirely their fault -- it is the default point of view in the US not to question the cost of medical care (just to complain about it after the fact). It is only very recently that people are starting to.

I had a minor knee surgery a few years ago. The Dr's office wanted to send me to the nearest MRI center to me - at a hospital - to get my MRI. I looked-up on my insurance company's website where they compared rates. Turns out the nearest MRI center to the Dr's office cost 1/4 as much. I took a copy of the list to them and suggested they start recommending it. But here's the thing:

1. They actually said: "why bother checking - your insurance company is covering it?" Well first, they weren't, I was in my deductible. But second, duh, our insurance rates are dictated by those prices!

2. I didn't shop around for the doctor and the surgery itself.
One last question, is there ANY charge amount that we can sort of push back on and start saying it's too ridiculous and medical billing fraud? Or, would they just say: "Nope, you had the responsibility of asking how much it was first."?
Right; no, they can charge literally anything. You wouldn't believe what the price inflation is like at hospitals.

Fraud isn't charging you a high price, it would be if they told you one price and charged you or your insurance company a different price or billed you for services they didn't do. That happens. My dad had a dentist do that. He would fill one tooth and bill the insurance company for two fillings.
 
  • #11
Be careful with what doctor you choose, some may be cheaper but may take 2 years to find a problem that easily could be found after a short 15 minute standard medical check, that costs like two dollars, causing you to have pain for two years and they may try to load you up on procedures and drugs you don't need but since you are not a doctor you do not know what you need or don't need. That happened to my brother, the doctors we went to gave him medicine that made his health worse, luckily we found a doctor that found and fixed it pretty quickly after a while.
 
  • #12
kyphysics said:
One last question, is there ANY charge amount that we can sort of push back on and start saying it's too ridiculous and medical billing fraud? Or, would they just say: "Nope, you had the responsibility of asking how much it was first."?
And they do not have the responsibility to state how much it will cost?

There's a basis for pushback right there. if you are a student, use the scarcity of funds excuse as a negotiating point.
And no. Saying ridiculous and fraud is not a negotiating tactic
Be nice and you may get nice back with a reduced bill.
After all, they themselves set the price and not an umbrella organization, so there could be a sliding scale on ability to pay.
if you do not try you will never know the willingness to accommodate.

kyphysics said:
Maybe I can warn others away...
Not likely.
 
  • #13
When my mother was extremely poor and me and both of my brothers had serious health issues my mom was able to negotiate to not pay anything due to her lack of funds, in fact they gave us a extremely expensive nebulizer to use, that at the time was top of the line. So just kindly tell them any monetary issues you may have and ask for a reduction. Many businesses including doctors and others will often reduce the price, heck, recently I reduced a price at my store for a customer due to monetary issues.
 
  • #14
russ_watters said:
Service providers charge whatever people will pay for their services
In the medical field, it's whatever insurance companies will pay for their services. :oldwink:
 
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  • #15
Just for info.. I'm in the UK and went to a physiotherapist about 6 month ago with a knee problem. The assessment/first session cost me about £60. Subsequent sessions were about £40-45 including laser treatment. This was good private physio not NHS.
 
  • #16
jtbell said:
In the medical field, it's whatever insurance companies will pay for their services. :oldwink:
Yes, good point, and that's part of the problem: since the end customer isn't paying directly, it reduces their incentive to price shop. They figure that's the insurance company's problem.
 
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  • #17
jtbell said:
In the medical field, it's whatever insurance companies will pay for their services. :oldwink:
The difference between in network and out of network can be a factor of 2 or more...
 
  • #18
russ_watters said:
They figure that's the insurance company's pronlem.

Correctly.
 
  • #19
Vanadium 50 said:
Correctly.
How do you figure? If the insurance company can't totally control where I go for treatment and my decisions affect how much they pay, then my decisions affect how much I pay, right? That makes it my problem too.
 
  • #20
Tragedy of the commons.
 
  • #21
Stephenk53 said:
When my mother was extremely poor and me and both of my brothers had serious health issues my mom was able to negotiate to not pay anything due to her lack of funds, in fact they gave us a extremely expensive nebulizer to use, that at the time was top of the line. So just kindly tell them any monetary issues you may have and ask for a reduction. Many businesses including doctors and others will often reduce the price, heck, recently I reduced a price at my store for a customer due to monetary issues.

Appreciate the tip, S53. That's awesome you're willing to work with a customer.
 
  • #22
russ_watters said:
Right; no, they can charge literally anything. You wouldn't believe what the price inflation is like at hospitals.

Fraud isn't charging you a high price, it would be if they told you one price and charged you or your insurance company a different price or billed you for services they didn't do. That happens. My dad had a dentist do that. He would fill one tooth and bill the insurance company for two fillings.

Yeah, fraud is not the right description.

re: hospitals

What's the wisdom for these situations...most people can't price shop in cases of emergencies (granted, not all hospital visits are emergencies).

Do E.R.'s take advantage of this? Is there some kind of E.R. price controls in U.S. health care? As for inflation...yeah...it seems medical inflation is pretty high compared to other industries. I think my dad's two day stay + some blood tests was like $10K in our local hospital. Insurance covered some of it. That's like a used car! ..for 48 hours of care (most of it was precautionary to monitor his heart, since he's got some irregularities and it "acted up" once... no surgery or procdures...just him laying in bed most of the time)!
 
  • #23
russ_watters said:
Yes, good point, and that's part of the problem: since the end customer isn't paying directly, it reduces their incentive to price shop. They figure that's the insurance company's problem.
My insurance at this point has a relatively low premium and high deductible along with a health savings account that we put pre-tax money into. We see every bill and pay them ourselves out of that account so of course really care how much things cost. While this is a pain and I liked our old insurance better, I think the healthcare providers receive less money from us and we are receiving the same care. This doesn't seem like a terrible way to help control costs.

russ_watters said:
I had a minor knee surgery a few years ago. The Dr's office wanted to send me to the nearest MRI center to me - at a hospital - to get my MRI. I looked-up on my insurance company's website where they compared rates. Turns out the nearest MRI center to the Dr's office cost 1/4 as much.
Your insurance company is better than mine - last I checked I did not have access to a website that compared the prices. I have had to call on my own, often with frustrating results. Fortunately, the pediatrician my daughters go to pays attention to these things; instead of sending us to the imaging center across the street we drive a few miles and save well over 50%.
 
  • #24
jtbell said:
insurance companies
Plus malpractice insurance.
 
  • #25
Vanadium 50 said:
Tragedy of the commons.
I'm only kinda seeing that. In the tragedy of the commons, people have to be willfully abusing the system (the common property). In the case of healthcare, they aren't willfully abusing it, they just aren't actively trying to help it. It's a neutral pressure, not a positive pressure on prices (vs normal capitalism, in which competition/selection is a negative pressure). It doesn't help, but it isn't quite so destructive as the issue with common property.

[edit] I guess maybe it doesn't need to be on purpose? But if it is by accident/due to not paying attention, then it isn't any different than overdrawing your own bank account because you weren't paying attention, in which case there is no "commons".
 
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  • #26
jasonRF said:
Your insurance company is better than mine - last I checked I did not have access to a website that compared the prices. I have had to call on my own, often with frustrating results. Fortunately, the pediatrician my daughters go to pays attention to these things; instead of sending us to the imaging center across the street we drive a few miles and save well over 50%.
It's Aetna, for what that's worth.

For kicks, I checked the current prices for a knee MRI. I'm in my deductible, so these are actual prices, not just the portion I pay (I pay all of it):
A nearby imaging center: $425
A nearby hospital: $1373
A hospital, a little further away: $1998

[edit] Oops, that's not quite right. The hospital a little further away is more than my deductible remaining, so only part of it is covered. The actual cost is *$2762*! And that's the negotiated rate!
 
  • #27
I recall there was an article in the Google news within the past few weeks about the cost of medications. It seems some insurance companies were caught charging co-pays higher than what they were paying the drug stores! The word Ethics doesn't seem to be in their dictionary. But since you are told ahead of time what the co-pay is, and you obviously agreed to it, it's legal.
 
  • #28
kyphysics said:
That's awesome you're willing to work with a customer.

I understand the sentiment, but are you sure? I mean what if the cashier at 5 Guys looked at your clothes, or checked out your car before he told you how much your burgers and fries cost?

I know, lots of doctors do this. But in the end it means they're charging someone else more, just because they figure the other guy can afford it.
 
  • #29
I'm glad I'm in NZ, with our public health system...
 
  • #30
gmax137 said:
I understand the sentiment, but are you sure? I mean what if the cashier at 5 Guys looked at your clothes, or checked out your car before he told you how much your burgers and fries cost?

I know, lots of doctors do this. But in the end it means they're charging someone else more, just because they figure the other guy can afford it.

I actually do have a doctor who charges me about 1/2 of what they normally charge, b/c I'm a college student. But the difference is I never asked her for that discount. I just knew she gave it to me a few times, because the front office told me when I expressed shock at the bill and asked if they accidentally charged me wrong..

I don't have an issue with this, as it would be the same as someone giving to charity. I wouldn't feel it was my place to say who people can give to and who they can't. I know it probably feels unfair if you're a hardworking person just making it and not super poor, but in practice I see it similar to a movie theater or restaurant giving senior discounts or veteran discounts. Or...saying "kids eat for free."

Unless we're ready to say there's something wrong with giving veterans discounts, then I can't really fault doctors for doing this. I just never asked, though. This might be the first time I'd have to ask about it. It does feel weird, but I'm not opposed if I feel the bill is ridiculous. It could be coincidence, but those examples I gave in the OP had some rude/arrogant doctors/therapists. Maybe they're jerks without a conscience who charge people high...who knows.

On a separate note, I've been thinking about homeless giving lately. As poor as I am right now, I gave $5.00 to a guy who claimed to be homeless and asked me at the gas station a few days ago. He'd been rejected by six different people, as I was watching him, before he approached me. I felt bad and his voice sounded desperate, so I gave. Then, I went online and searched around. I've been seeing all these stories of homeless panhandlers making $60 to $100K/year and this has got me thinking twice. I'm like dangggg, you make more than some college grads. More than me certainly (made $12/hour in my summer job). Some of these guys may not have a house of their own, but they're making $60k/year!
 
  • #31
StevieTNZ said:
I'm glad I'm in NZ, with our public health system...

I wish the U.S. had single-payer and the ability to negotiate and/or import cheaper drugs. Big Pharma's lobbyists essentially buy out Congress so we never get bills passed that allow us to negotiate prices or just import from a place like Canada. Americans would be saving hundreds or thousands of dollars a year otherwise. That's what happens we you live in an oligarchy, as Princeton political scientist, Martin Gilens' famous 2014 study showed.

I think that'll change soon, though. 2020 baby!
 
  • #32
kyphysics said:
ig Pharma's lobbyists essentially buy out Congress so we never get bills passed that allow us to negotiate prices or just import from a place like Canada. Americans would be saving hundreds or thousands of dollars a year otherwise.

This is what happens when one gets one's economics from Dave Ramsey rather than learning how to do research on your own.

Can we agree that the absolute cheapest drugs can get is no cheaper than when the company that makes them makes zero profit? It turns out that all US publicly traded companies have to file a form with the SEC called a 10-K which says, among other things, what their revenues were and what their profits were for the preceding years. This is public, and can easily be found on each company's web site. You will find that most of these companies have profits in the 20% ballpark - with some annual variation, of course.

So that's the maximum possible savings: 20%. In real life, it's much smaller.

kyphysics said:
I think that'll change soon, though. 2020 baby!

Sorry, comrade. It's been tried and it does not work.
 
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  • #33
Vanadium 50 said:
This is what happens when one gets one's economics from Dave Ramsey rather than learning how to do research on your own.

I was going to give a like for this alone, and I generally think you have a voice of reason for these sorts of threads. But in this case, I think the rest of your post falls short, unfortunately.

Vanadium 50 said:
Can we agree that the absolute cheapest drugs can get is no cheaper than when the company that makes them makes zero profit? It turns out that all US publicly traded companies have to file a form with the SEC called a 10-K which says, among other things, what their revenues were and what their profits were for the preceding years. This is public, and can easily be found on each company's web site. You will find that most of these companies have profits in the 20% ballpark - with some annual variation, of course.

So that's the maximum possible savings: 20%. In real life, it's much smaller.

kryphysics point was about pricing in the US. You're right to focus on the entire pie size. The fallacy is you somehow have US and other rich world members on the same footing. They are not.
- - - -

Let me give a simple finance typical look at this. First, I presume you're talking about 20% Operation Profit Margin or EBIT (or some similar metric).

Limit the scope of the world to the rich world: Japan, Western Europe, Canada and US, plus perhaps Australia and a few more. This is a common rich world grouping. The US has about ##\frac{1}{3}## of this population, yet is responsible for a majority of pharma profits. Note that these products have very low marginal Cost of Goods Sold i.e. production and shipping costs. The real expenses are in R&D and marketing.
- - - -
reference: https://www.wsj.com/articles/why-the-u-s-pays-more-than-other-countries-for-drugs-1448939481

or better, simply look at the chart here:

https://www.economist.com/news/scie...more-america-elsewhere-may-be-just-priced-out

and note the mix of consumption may not be the same but the comparisons between, US, UK and Oz should jump off the page.

I no longer have my subscription to Health Affairs, which would have much more detailed info, but the chart in The Economist link really should suffice. When effect sizes are this big, problems really do get a lot easier.

- - - -
You can easily make the case of prices falling by ##25\text{%}## or more in the US if other members of the rich world were to pay more (about ##25\text{%}## more in this case) while not affecting pharma profits much at all.

(How to price drugs in low to middle income countries is a much more difficult problem, and way outside the scope.)

With more granular numbers I could interpolate the amount they'd fall in the US while keeping total sales to big pharma constant -- though the pricing changes would be so high that there would probably be substitution effects which would further complicate things-- if we homogenized the pricing amongst the rich world.

But the point is that ##25\text{%}## is an easy estimate, which leaves room for a lot more equalization, does not touch pharma profitability, and it exceeds than the strict upper bound you gave on percentage price drops in the US. Put differently, I'm suggesting a ##25\text{%}## drop as a loose lower bound for US pricing.

- - - -
It should be obvious that there's a negotiating problem here, but who really understands negotiating? Some more reading here:
https://www.economist.com/blogs/economist-explains/2016/09/economist-explains-2
- - - -
Mathematical note:

If you want something fancier, I can come up with a doubly stochastic matrix ##\mathbf A## that maps from the current highly unequal pricing mix between rich world countries to a mildly more equitable one. Some basic ideas about majorization are very useful when contemplating issues like this.

- - - -

Above and beyond this, its widely viewed that direct to consumer advertising on Rx drugs -- basically a US phenomenon-- are highly manipulative with little to no information value -- a lot of other marketing expenses fit in this bucket too, especially a lot of 'education' expenses with physicians -- formerly including family vacations to the Caribbean, though I think that got reined in a decade or two ago. Put differently direct to consumer and some other marketing expenditures are a dead-weight loss. The issue of dead-weight losses to society is a bit more subtle, so I'll mention that but not develop it.
 
  • #34
StoneTemplePython said:
I was going to give a like for this alone

Go ahead. You know you want to. :cool:

StoneTemplePython said:
You can easily make the case of prices falling by 25%25\text{%} or more in the US if other members of the rich world were to pay more

No argument here. But they don't. (I could also make the case that drugs would be "free" if Daddy Warbucks were to pay for them. That doesn't happen either) Should the other members of the First World (I'm looking at you, Canada) pay more? Sure. Are they going to'? Doesn't look that way.
 
  • #35
Vanadium 50 said:
Go ahead. You know you want to. :cool:

Done!

Vanadium 50 said:
No argument here. But they don't. (I could also make the case that drugs would be "free" if Daddy Warbucks were to pay for them. That doesn't happen either) Should the other members of the First World (I'm looking at you, Canada) pay more? Sure. Are they going to'? Doesn't look that way.

I'm going to ignore the Daddy Warbucks comment -- to the extent I understood it, the money is still coming out of the US Taxpayer's pocket.

- - - -
I don't predict it happening near term, but the basic idea is to apply pressure -- a lot of it in fact, for a pro-longed period of time, on other rich world countries-- who just so happen to be US allies. A primary channel would be via State Department -- an indirect channel would be via corporates (see next paragraph). The current system does not apply any pressure, which is a pre-req for change, in my view.

- - - -
One lever to effect pricing change would be for the US to mimic EU tactics via indexing on prices paid by peer countries. The near-term results would be disastrous for industry and cause a lot of internal pressure in places like UK, Switzerland, and France via their own giants like GSK, Roche, Sanofi, etc. that make a disproportionate amount of their money off the US.

I am not saying it's an easy road -- but sustained, increased pressure is the road.
- - - -
It's worth remarking that all the other rich countries mentioned are US allies. I think there are similar grievances that can be made in other areas (NATO spending comes to mind). To date discussions about "America First" have been intellectually unsavory, though there are valid free-riding concerns to be had. With respect to having these sorts of conversations, amongst the numerate population, at least, I think we can do better.

One issue I constantly run into in the real world, though, is insurmountable innumeracy. People don't want to put in the work required to have an informed viewpoint , but they still want to have their own opinion... very frustrating.

edit:
The idea of a Free Rider Problem is a simple, basic one from econ 101. Maybe it is too close to some nasty politics right now?
 
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