US health care costs (microcosm)

[brori]

I am in India and came down with an URI with cough/fever/green phlegm production

Cost of Z pack in India $1.50
Cost of Z pack in US cash pay $37.00

same packaging/blister packs

Keep in mind that there are no pharmacology rep restrictions in India. Physicians here tell me they get 1st class flights and AV/media rooms from pharm industry

What is going on? Can't be $35 mark up for US R&D.

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[southerndoc]

Because we are willing to pay high prices in the US. If we refused to prescribe and purchase these high-priced drugs, the prices would come down. Also, many countries have negotiated pricing whereas the US doesn't.

People may make fun of me for doing so, but I still prescribe old, tested, and cheap drugs as they work just as well. No need for Levaquin or Avelox for a urinary tract infection as ciprofloxacin, Bactrim, etc. work just as well.

 

[brori]

I agree with you. I am a PM&R pain physician (outpatient musculoskeletal/EMG/interventional pain practice and rarely prescribe abx. When I see a healthy patient with mild cellulitis from IV post procedure=bactrim unless sulfa allergy (works fine) If sulfa allergy and no PCN allergy, pcn. Patient has mild sinusitis/pharyngitis/sore throat and talks me into prescribing abx (begs not to see pcp and pay another copay) Ditto. Cost containment was a huge part of my UTSW med school and residency training. Resistance to bactrim rarely seen except in frequent UTI/catheter patients (from my experience)

Drug companies are evil and are fleecing america.

 

[willow18]

The reason for the difference is costs is simple:

In India, the drug companies charge a price according to what the production costs are. So if it's selling for $1.50, you can be sure it doesn't cost the company more than 75 cents to a dollar to produce a Z-pack.

In the US, prices are NOT set by production costs, instead the companies charge the highest price "the market will bear". And who is the "market" you ask? Medicare. And as long as Medicare doesn't object (and why would it, Free Market rules, right?), the insurance companies follow like sheep.

This is not my theory, the companies admit it themselves. Here's a quote from one of them from a Times article earlier in the year.
http://www.nytimes.com/2008/04/19/business/19specialty.html

""Steve Cartt, a Questcor executive vice president, said the new price was chosen by looking at the prices of other specialty drugs and estimating how much insurers and employers would be willing to bear."

So as long as Medicare and the major insurance companies pony up $37 for a Z-pack, they will keep the price there. No need for logic or fairness. Let the American people finance the rest of the world's drugs.

Here's another illuminating article: "Drug prices up 100% — or higher"
http://www.usatoday.com/printedition/news/20080808/1a_bottomstrip08_dom.art.htm

 

[Jeff698]

Perhaps another reason for increasing cost is the treatment of viral illnesses with antibiotics to begin with?

I had "the antibiotic" discussion with a mom last night. Didn't go well. You know that look in their eyes when you see "you're a complete quack of a doctor; even a ***** would know to treat this with ABX" written all of their face?

I hate that look.

Take care,
Jeff

 

[ccfccp]

Awww... my response disappeared. Did I do something wrong?

 

[docB]

Awww... my response disappeared. Did I do something wrong?

There was some kind of server or database issue and we lost a few posts. Sorry.

Another thing increasing costs is liability. The drug companies have to charge enough to cover the next big jackpot a la Vioxx that comes along.

 

[willow18]

Perhaps another reason for increasing cost is the treatment of viral illnesses with antibiotics to begin with?

I had "the antibiotic" discussion with a mom last night. Didn't go well. You know that look in their eyes when you see "you're a complete quack of a doctor; even a ***** would know to treat this with ABX" written all of their face?

I hate that look.

Take care,
Jeff

That does increase overall health costs, but should in theory lower the price of antibiotics.

I wonder how socioeconomics affect the antibiotic seeking...I worked in an urban peds office and all the mothers were very accepting of my "can't treat a virus with abx" explanation. The resistance I did find was to the flu shot. I would say 25-50% of parents believe that it gives the child the flu. I managed to convince some of by the old "just like the polio shot didn't give your child polio...."

 

[Jeff698]

The resistance I did find was to the flu shot. I would say 25-50% of parents believe that it gives the child the flu.

Silly parents. Of course the flu shot doesn't give their kids the flu.

Autism, on the other hand.....

Take care,
Jeff

 

[willow18]

Silly parents. Of course the flu shot doesn't give their kids the flu.

Autism, on the other hand.....

Take care,
Jeff

Ah, interesting you should mention that. I didn't exactly do an official survey, but from what I saw the only folks worried about autism were white, while the AA/Hispanics all believed it can give the child flu...interesting stuff for a sociologist who wants to ponder.

 

[Apollyon]

I managed to convince some of by the old "just like the polio shot didn't give your child polio...."

Well, the oral polio vaccine did cause cases of polio, but was stopped in the US in 2000, and in the UK in 2004, because more people got polio from the vaccine than from in the wild. Although the inactivated (IM) vaccine is now used, still, in the developing world, the OPV is still used.

 

[turtle md]

URI ... Z pack

These 2 should not be in the same sentence.

 

[GeneralVeers]

These 2 should not be in the same sentence.

Actually I use Z-pack for URIs quite a lot. The resistance to it from strep pneumo and many other common organisms is so high, that it's essentially a placebo. If someone is REALLY sick with a pneumonia I'll give them Avelox, or PCN for strep throat.

 

[Jeff698]

I think turtle's point was the same as my earlier one. Most URIs are viral.

Take care,
Jeff

 

[Hallm_7]

Pricing for anything isn't set by what's "fair." Prices are set by what the market will bear. That's why iPhones cost $750, Coach purses cost $300, and plane ticket prices vary depending on destination, date, and time.

Until physicians start making judgements about the cost effectiveness of medications then we won't see prices come down. I am always amazed that many PCPs automatically initially write for Lipitor to threat hypercholesterolemia when generic simvastatin can be bought for $3.33 a month. The far more expensive lipitor may lower LDL a few extra points, but those few extra points probably don't contribute to significant mortality benefits. The same thing goes for physicians who write for name brand Lexapro first before even trying generic (and more proven) paroxetine. It's easy to think of similar prescribing practices with ABX, HTN meds, Diabetes meds, and many other classes of medications.

If a medication's dosing schedule is convenient and has similar efficacy when compared to a more expensive medication in the same class, I believe it is socially irresponsible for physicians to write for the more expensive medication.

I believe every physician should carry, or know how to quickly access, Wal-Mart's $4/$10list of medications. I would guess that 80% of patient encounters (in both discharged ED patients and primary care patients) could be properly treated by only writing from the $4/$10 list thereby saving our patients quite a bit of money and improving compliance.

 

[Jeff698]

I believe every physician should carry, or know how to quickly access, Wal-Mart's $4/$10list of medications.

I'm a big fan of this list. Sadly, our IT department isn't, apparently. They've gotten their panties in a twist about bandwidth and blocked the majority of outside websites. They say they're only blocking "non-medical" sites.

Both WalMart and Target's $4 list are blocked.

Grrrrr.

BTW, I've been seeing a lot of patient's coming in on Levaquin. It now seems to be the first line agent for damn near everything, whether it actually covers the likely bug or not (most being viruses, of course). I guess there's a really good sales rep around somewhere.

Take care,
Jeff

 

[DrMom]

The IM department in my hospital printed out both the Walmart & Target $4 lists, shrunk them down to pocket size, and laminated them. Very handy!

 

[Apollyon]

I'm a big fan of this list. Sadly, our IT department isn't, apparently. They've gotten their panties in a twist about bandwidth and blocked the majority of outside websites. They say they're only blocking "non-medical" sites.

Both WalMart and Target's $4 list are blocked.

Grrrrr.

BTW, I've been seeing a lot of patient's coming in on Levaquin. It now seems to be the first line agent for damn near everything, whether it actually covers the likely bug or not (most being viruses, of course). I guess there's a really good sales rep around somewhere.

Take care,
Jeff

It's available on a PDF. You can put it on a flash drive and put it on the desktops of the computers, or just print it out and post it (which is what the outside hospitals do here).

 

[willow18]

Pricing for anything isn't set by what's "fair." Prices are set by what the market will bear. That's why iPhones cost $750, Coach purses cost $300, and plane ticket prices vary depending on destination, date, and time.

Until physicians start making judgements about the cost effectiveness of medications then we won't see prices come down....

Items like an iPhone are different than medicines because competition (e.g. Blackberry) induces a level of 'fairness' in the marketplace. This is not found in medicine where a drug can be alone in its target spectrum and thus the manufacturer has carte blanche to name a price, a monopoly.

I fully agree on the physician judgment point, but we will eventually need something like the UK's NICE that will make these cost-benefit decisions on a nationwide basis, and not leave it up to docs who get greased by lunches, lecture fees and whatnot.

 

[EBKame]

For anyone interesting in reading more about how health care in the US came to cost as much as it does, including perscription drug prices, I would highly recommend Sick http://www.amazon.com/Sick-Untold-Americas-Health-Crisis/dp/0060580453 I just finished reading it and it gave me a much better idea of how HMOs came to be and why the US didn't develop a universal health care system like in Europe...

 

[docB]

For anyone interesting in reading more about how health care in the US came to cost as much as it does, including perscription drug prices, I would highly recommend Sick http://www.amazon.com/Sick-Untold-Americas-Health-Crisis/dp/0060580453 I just finished reading it and it gave me a much better idea of how HMOs came to be and why the US didn't develop a universal health care system like in Europe...

What's it say? I'll read it if it's a good analysis. If it's a lament about not having socialized care I'll skip it. I've looked at it a few times in the bookstore but couldn't decide which way it would go.

 

[EBKame]

It's not a lament about not having socialized care. It IS critical of the current administration, specifically Bush dodging change to managed care policies in Texas, where the rate of uninsured is higher than in any other state of the nation. It's a historical review of health insurance solutions told in vignettes. The chapters focus in on different cities (notably Denver, Chicago, LA) and stories of patients' unfortunate interactions with our broken health care system. The writing style is a little bit like Fast Food Nation...a quick read, but often overdramaticized.

 

[GeneralVeers]

It's not a lament about not having socialized care. It IS critical of the current administration, specifically Bush dodging change to managed care policies in Texas, where the rate of uninsured is higher than in any other state of the nation. It's a historical review of health insurance solutions told in vignettes. The chapters focus in on different cities (notably Denver, Chicago, LA) and stories of patients' unfortunate interactions with our broken health care system. The writing style is a little bit like Fast Food Nation...a quick read, but often overdramaticized.

Sounds to me like a lament about the lack of socialized medicine. What did the book offer as an alternative to the "broken" system we have now?

 

[docB]

It's not a lament about not having socialized care. It IS critical of the current administration, specifically Bush dodging change to managed care policies in Texas, where the rate of uninsured is higher than in any other state of the nation. It's a historical review of health insurance solutions told in vignettes. The chapters focus in on different cities (notably Denver, Chicago, LA) and stories of patients' unfortunate interactions with our broken health care system. The writing style is a little bit like Fast Food Nation...a quick read, but often overdramaticized.

Yeah, not so sure what the Bush administration did good or bad to healthcare policy at the national level. As for the TX stuff I think their problems with uninsured have more to do with immigration than HMOs. If their issues with Bush had to do with managed care policy then they're talking about insured people not uninsureds.

 

[El Cheba]

I'm a big fan of this list. Sadly, our IT department isn't, apparently. They've gotten their panties in a twist about bandwidth and blocked the majority of outside websites. They say they're only blocking "non-medical" sites.

Both WalMart and Target's $4 list are blocked.

Grrrrr.

BTW, I've been seeing a lot of patient's coming in on Levaquin. It now seems to be the first line agent for damn near everything, whether it actually covers the likely bug or not (most being viruses, of course). I guess there's a really good sales rep around somewhere.

Take care,
Jeff

If you guys live in areas that have a Publix grocery store, they have a list of 8 FREE antibiotics. Publix has locations in Alabama, Georgia, Florida, South Carolina and Tennessee.
http://www.publix.com/about/newsroom/NewsReleaseItem.do?newsReleaseItemPK=2985

 

[GeneralVeers]

If you guys live in areas that have a Publix grocery store, they have a list of 8 FREE antibiotics. Publix has locations in Alabama, Georgia, Florida, South Carolina and Tennessee.
http://www.publix.com/about/newsroom/NewsReleaseItem.do?newsReleaseItemPK=2985

Yeah but if there's no vicodin in it, most of our patients still wouldn't get it filled....