Health care at one time was a altruistic endeavour. Yes you earned a living and companies made profits but most providers were individuals and most institutions, non-profits. The pharmaceutical industry at the time had the moniker, “ethical.”
Since the mid eighties there has been a unceasing inflation in costs. Individual providers are anachronisms today and non-profits for the most part have converted into to for-profit entities. As a matter of fact, because of a lack of concern about costs, even the non-profits that survive charge the same or more.
The report today in the Times on the rapid increase in generic dermatologic drugs re-emphasizes the point the prices in health care have nothing to do with costs of “development” or production. It’s simply whatever drug companies choose to charge. Since the number of suppliers and producers are few they are not inclined to compete on price. So prices sky-rocket:
They are the staples of most dermatology practices: generic creams and ointments that treat everything from skin rashes to athlete’s foot to scabies. Many doctors prescribe the drugs without a second thought. But increasingly, some dermatologists say, patients are complaining about a recent, mysterious and rapid rise in price.
Take betamethasone dipropionate, a cream used to relieve itchy skin. In 2008, a tube cost $18.17. The medicine now costs $71.28, according to Red Book, which tracks wholesale drug prices. Permethrin cream, which kills scabies mites, cost $29.25 in 2008 but has jumped to $71.08 today.
Medicynical Note: There’s no rational reason for this except that companies charge what insurers will pay. Since Medicare is forbidden from negotiating prices and private insurers simply pass through the higher prices by adding to co-pays and deductibles, there is no strong countervailing force to control the gouging, particularly for these relatively inexpensive agents.
In other countries the governments negotiate prices and control price increases. In our country our congress, under republican control at the time, forbade Medicare to negotiate.
Is it any wonder that we pay more, double in some cases, for health care than anywhere else in the world….and I’d hazard a guess that we pay more for these drugs as well.