Drug Shortages Have Gotten Worse
[T]he FDA’s new powers have not relieved cancer patients from these shortages of necessary medicines. In 2012 and 2013, the number of drugs in short supply has hovered around 300, a deterioration of about 20 percent…
The federal government established 340B in 1992 as a way to reduce prices of drugs for inner-city hospitals that serve a disproportionate volume of indigent patients.
Eligible hospitals enjoy a government-dictated discount of 25 percent to 50 percent off the regular price. As described by Forbes contributor Scott Gottlieb, MD, of the American Enterprise Institute, one third of the nation’s hospitals now profit from the scheme, including rich ones like Cedars-Sinai in Los Angeles and Duke University in North Carolina.
Further, according to Dr. Gottlieb, hospitals do not pass this windfall on to patients or the government. Rather, they use the excess profits to acquire oncology practices. As a result, there has been a dramatic increase in the proportion of chemotherapy administered in hospitals rather than more convenient and less expensive oncologists’ offices.
Source: John Graham.
“Further, according to Dr. Gottlieb, hospitals do not pass this windfall on to patients or the government. Rather, they use the excess profits to acquire oncology practices. As a result, there has been a dramatic increase in the proportion of chemotherapy administered in hospitals rather than more convenient and less expensive oncologists’ offices.”
Whattt? the government is screwing everything up???
I really do understand why good intentioned people feel like they should meddle with the market to fix things, but the evidence just doesn’t support it.
It always seems like we keep coming up with excuses to try government one more time. Like if we jump off the cliff and do a backflip this time we won’t eventually smash against the ground.
Great comparison. Nobody where we jump from, gravity (or economics laws) still pull us down.
no matter*
I’m certain that the reaction will be to introduce more government and blame the free market…smh
Undoubtedly. When do we hear about the greedy drug companies withholding grandma’s medicine?
I’m sure they’ll come up with some argument for nationalization.
It’s amazing how easily people are manipulated into thinking that the government can and should take care of them.
Besides shortages, the 340B program has other unintended consequences. The 340B program also gives hospital oncology programs an additional financial advantage over community oncology clinics. Not only do nonprofit hospitals that participate in the 340B program get drugs at a significant discount, in addition the hospitals get higher reimbursements for the same treatments that could have been done in a clinical setting. Over time community oncology practices find it more advantageous to sell out to hospitals — which costs taxpayers more for the same services.
That is a serious consequence. As we get close to oligarchy people will have less diverse options and will be less able to seek the quality and price that suits them.
The rich get richer…
Hospitals are buying up all kinds of practices, especially primary care. The consequence will be a bureacratic approach to care instead of a personal one. Primary physicians will be fed up dealing with all the government intrusion and be happy to sell out to hospitals and let them deal with the regulations and mandates. As a result docs will become salaried employees, hospital costs will go up, and we all will continue to pay through the nose for medical care.
Exactly, the real question is: Is someone steering this or are we careening wildly? Consolidation seems a little too convenient considering that the primary goal of the left is to have a single-payer system.
I agree Dewaine, I think single payer is the ultimate goal. At that point we’ll have 9-5 medical care like Canada.