Obama Care

[saden1]

Originally Posted by JoeRedskin

And so it begins:
NYT: Drug firms raise prices ahead of reform - The New York Times- msnbc.com

"Even as drug makers promise to support Washington’s health care overhaul by shaving $8 billion a year off the nation’s drug costs after the legislation takes effect, the industry has been raising its prices at the fastest rate in years.

In the last year, the industry has raised the wholesale prices of brand-name prescription drugs by about 9 percent, according to industry analysts. That will add more than $10 billion to the nation’s drug bill, which is on track to exceed $300 billion this year. By at least one analysis, it is the highest annual rate of inflation for drug prices since 1992.

The drug trend is distinctly at odds with the direction of the Consumer Price Index, which has fallen by 1.3 percent in the last year."

12th - I read the article you referenced. It seems to cite the same concerns I (and others) have previously discussed here (and in the other 50 pages of health care discussion) without really saying anything other than "We'll see".

Saden - Other than the pledge from health care actors to find ways to lower costs and the issues you have cited concerning doctors, what other cost cutting methods are in teh bill? You cite the generic pooling that is to occur, that's fine but ignores that the increased pooling also creates increased costs. With HC costs rising steadily w/in the current framework, what systemic changes to the insurance based system are being proposed? I am aware of none. Rather, the public option included in the bill appears to be nothing more than a gov. run HMO which will be even further divorced from market forces than the current system. (See Schneed's various discussions as to how little market accountability currently exists in the healthcare system).

I have read the various summaries you have provided. I do not see where the "downward pressure" on costs is coming from. Mandatory pooling will not cure the cost inflating ills created by the anti-market influences of the current voluntary pooling system.

"Increasing costs" is better than "increasing risk" but it's still nonsensical as it does not allude to what this increased risk is beyond there are 47 million new customers. If a large portion of them were of poor health your concern might be valid. To be honest, insurance industry would like nothing more than to have more customers though for profit reasons they would much rather have more healthy ones than those who aren't.

The current bill also provides for the ability to negotiate drug prices and it also reverts the language in the Medicare Part D that barred the government from negotiating dug prices. As for the drug makers there is nothing free market about them as they enjoy a soft monopoly under the guise of the patent system and engage in price fixing (Merck and Pfizer) and fraud (Pfizer, GlaxoSmithKline, Novertis, Merck, Eli Lilly). They have been steadily raising prices every year and their act is nothing more than price gouging with a blessing. Frankly you're not going to stop this price increase without some sort of government act (through patent reform or direct federal grants to universities to do drug research). This is one industry where the consumer simply can not vote with his dollars.

Calling it government run HMO doesn't make it so. The truth is this bill is still insurance industry friendly as it is not a bill that creates a single payer system. Divorced from market forces? Every industry in this country has enjoyed nurturing by the federal government. The initial cost of funding this exchange is no different, it is intended to a) provide means to those who can't afford insurance subsidy to purchase health care and b) to lower their cost by creating a platform where they can strengthen their negotiating power. There is nothing inherently anti-free market about that.