Previous posts in this discussion:
PostGOP Party Platform, 2012 (Tor Guimaraes, USA, 09/04/12 3:57 am)
John Recchiuti (3 September) made some valid comments difficult to disagree with. "Republican calls for lower taxes will play well with many voters ... Americans don't particularly like paying taxes. Republican concern with extraordinary annual growth in the debt each year under Obama (a trillion-plus dollars each year--and, as a percentage of GDP, more than three times higher than under FDR's New Deal) will also find traction. Voter concern about the affordability of The Affordable Care Act (Obamacare) will win votes, too."
I agree, but one must look beyond the rhetoric and dogma for things to make sense. No one in his right mind likes to pay taxes. We do it because we have to; it is and has always been part of the game. It is very simple: every great nation needs a very expensive infrastructure and a strong and stable middle class able to afford a decent standard of living. Government must enable these realities, and in the case of the infrastructure many items must be provided by the government. For that, some form of taxation is necessary and the only question is, who pays? A progressive income tax (or a wealth tax?) is important to reduce unreasonable income inequality as we have today, which is a direct threat to our democracy not to mention social injustice.
John wrote, "what I don't see with the Republican approach is any commitment to lowering the deficit ... where's the other Norquist-like pledge by Republicans, something like, 'We pledge to lower the deficit by X% each year'? It appears instead that Republicans want to lower taxes in the hope that lower taxes will grow the economy. But Clinton raised taxes and the economy grew apace, whereas in the aftermath of President G.W. Bush's substantial tax cuts the nation experienced the most anemic economic growth in thirty years. So I don't see that the Republicans are committed to shrinking the deficit."
Again we must look beyond the rhetoric and dogma for things to make sense. Everyone agrees we must reduce the deficit. For that we need to increase government revenues and/or reduce expenditures. How can we increase revenues? Democrats say increase income taxes on the wealthy since income inequality is getting obscene. Republicans say reduce income taxes, close some undefined tax deductions, and add regressive sales taxes. On the other hand, reducing government expenditures is also critical, but which expenditures? We could stop going all over the world "nation building" and telling people what to do, reduce corporate welfare, foreign aid, expensive wars, etc. I know we need a strong military, but do we need a trillion-dollar budget? The Romney/Ryan team proposes to cut taxes on the wealthy, fight wars, maintain corporate welfare, but someone else (the middle class) will have to pay for the deficit reduction. In this case, expect the gap between rich and poor to skyrocket.
The Social Security program is critical for the survival of the American middle class and must be preserved. Just imagine if today we had a privatized retirement program instead; the degree of confusion and financial desperation would be considerably higher. To me Wall Street has not proven to be trustworthy enough. Similarly, I cannot accept a banking system without the FDIC.
John said, "both Republicans (the Ryan Plan voucher system) and Democrats (Obamacare-Affordable Care Act) insist that they will contain the growth in health care expenditures to about a 1% increase annually. But I don't see either party speaking clearly to the issue of entitlement expenditures." I agree. The Medicare and Medicaid programs are clearly unsustainable. As proposed before, to reduce health care costs, the emphasis must be in stamping out fraud and strongly promoting, forcing prevention. The Ryan voucher system indexed to inflation is a ruse which will destroy Medicare and will cut costs on the back of seniors.
JE comments: A small thought: what is the only way to attack health care fraud? By vastly expanding the government bureaucracy charged with monitoring the industry. Government grows, yet again...?
Health Care Costs
(Istvan Simon, USA
09/05/12 1:30 AM)
Eliminating health care fraud is not the way to save money on health care. (See Tor Guimaraes, 4 September.) There would be savings, of course, but they would not make much of a dent on our runaway health care costs.
It turns out that more than 50% of the rate of increase of our health care costs is due to technology. I will give two examples:
Avastin is an innovative cancer drug sold by Genentech (owned by Swiss Pharmaceutical Giant Roche). On average, it increases the life span of an advanced cancer patient for various cancers by three months. The cost, if I am not mistaken, for the treatment that accomplishes this increase in life-span, is $150,000.
Now, imagine I am an advanced cancer patient, and my doctor says this treatment will cost you $150,000 but you will live three months longer. Unless something really spectacular would happen in those 3 months of extra life, I would say to my physician thanks, but no thanks. I rather die 3 months sooner, but save my family (or my insurance company) 150,000 dollars.
Avastin is an example of overpriced technological improvement.
I give a second example: Ultrasound is a wonderful non-invasive technology, which helps detect all sorts of abnormalities in pregnancies for example, but also in many other areas of health care. This year's ultra sound machine is much better than last year's model, and in fact certain things can be detected with the new model, while they could not be with last year's model. So it is a significant improvement in health care to own this year's model, rather than last year's model, right? Well, yes and no. There is a significant improvement in health care with the new model. But it's cost does not justify buying it. Rather we should wait 5 years before we replace the obsolete 5-year-old model, with the latest marvel--today's model.
If we want to save money on health care we need to target reducing this kind of cost. It will have a huge effect on health care costs, which dwarfs whatever we would save by eliminating fraud entirely, eliminating malpractice law suits, defensive medicine, etc.
JE comments: Excellent points, but Istvan Simon may be in the minority when it comes to concern about saving money for his insurance company. I'm more selfish: if I could get my insurer to fund three additional months of life at $50,000 per month, I'd fight every step of the way to make it happen. Even better, I would think, would be to draw the line on Genentech's profits. Big Pharma's argument that they will stop developing new medications if they cannot charge exorbitant prices doesn't convince me. Ever talk off the record with a Drug Rep? It's an eye-opening experience.
Health Care Costs; Genentech's Avastin
(Randy Black, USA
09/05/12 3:54 PM)
In his post of 6 September, Istvan Simon wrote about the medical benefits versus the costs of a newer drug that treats certain types of cancer. Istvan wrote that Avastin prolonged the life of cancer patients only three months at a cost (to patients) of $150,000.
This information is out of date. I found the following facts within several medical Websites and within the NY Times.
While some, or many, patients may pay up to $150,000 annually and that's debatable, Avastin, via Genentech, is distributed at no cost to uninsured patients with annual incomes of less than $100,000 annually in the US through their physician. There are apparently some personal asset limits needed in order to qualify for free drugs.
This free service is via Genentech's Patient Access Program. For patients with health insurance but lower incomes and the associated co-pay financial issues, Genentech also has a program to help with the co-pays. http://www.gene.com/gene/news/kits/corporate/patientacc-factsheet.html#avastinpatient
As of July 6, 2008, (Genentech) "capped the price for a year's supply of Avastin at $55,000 for patients with incomes of less than $100,000 a year" but who are not qualified due to too many other assets. This price apparently does not include mark-up costs to hospitals and doctors, but is limited to out-of-pocket costs to patients, less insurance (for those with higher incomes).
From the NY Times: "Bevacizumab (Avastin) is one of the most expensive drugs widely marketed. Doctors and editorials have criticized the high cost, for a drug that doesn't cure cancer but only prolongs life.
"In the US, insurance companies have refused to pay for all or part of the costs of bevacizumab, and in countries with national health care systems, such as the UK and Canada, the health care systems have restricted its use because of the low ratio of benefits to cost.
"Genentech argues that the benefit is worth the cost, and the high cost pays for the expensive and risky research needed to develop new drugs. Genentech has adjusted the price for patients in certain circumstances. In 2008, sales of Avastin were nearly $2.7 billion.
"For colorectal cancer, Meyer wrote in the New England Journal of Medicine that bevacizumab extended life by 4.7 months (20.3 months vs. 15.6 months) in the initial study, at a cost of $42,800 to $55,000.
Per the above-mentioned 2008 NY Times article, "Avastin costs $4,000 to $9,000 per month. Currently, more than 100,000 Americans take Avastin."
RB: Most are covered by Medicare.
Medicare requires that the doctor or hospital buying Avastin be paid an amount equal to Genentech's average selling price plus a markup of 5 to 6 percent. -ibid.
"Costs in other countries vary; in Canada it is reported to cost $40,000 CAD per year." -ibid.
I must add that while the controversy about Avastin, which cures nothing, but prolongs life from a few to many months, there are other expensive drugs that apparently do cure other types of cancer.
For instance, Gleevec cures 10 different types of cancers including some types of leukemia. Gleevec runs $36,000 annually but is fixing to go generic if my readings are accurate. With insurance, a patient's co-pay is $50 per month.
Just so you'll know, research on Gleevec began in the 1960s. By the 1990s, testing began. Eight years later, it came online in 2001.
Via its Patient Assistance Program USA, the drug is distributed at no cost to uninsured patients with incomes lower than $43,000 annually. Thereafter, for patients with higher incomes, the price using a sliding scale up to household incomes of up to $100,000 annually.
JE comments: Very interesting information. In a sense, it's progressive taxation at its most severe. If, for example, you earn $150K and have more than the minimum assets, staying alive a few more months will take every penny you have.
- Health Care Costs; Genentech's Avastin (Randy Black, USA 09/05/12 3:54 PM)