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Old 02-26-2013, 03:20 PM   #161
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Still, my point is about resource allocation. Cures are good. But do we spend 100%, 99%, 98%, XX% of our total resources on developing them?

If we can't do everything we want, what do we do?
Let the drug companies and investors figure this out. If we fix the system so that it more closely resembles a market (where those receiving a benefit get the freedom to decide how much it is worth to them), then the drug companies will be rewarded according to the true value of their products. It'll be very clear to them (and to investors) how much to spend on research. Nobody tells Boeing or Ford how much to spend except the folks running the company.

A bigger problem is the need to find a way to incentivize private investment in basic research --stuff that can't be patent protected and won't result in a product in the near term. Schools, foundations, etc do good work, but it's not an especially efficient way of doing things. There would be more money and (more importantly) more efficiency and focus if business principles were in play. But, I do not know how to do that.
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Old 02-26-2013, 03:34 PM   #162
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Let the drug companies and investors figure this out. If we fix the system so that it more closely resembles a market (where those receiving a benefit get the freedom to decide how much it is worth to them), then the drug companies will be rewarded according to the true value of their products.
I have no problem with that. You're talking about letting a more or less free market make resource allocation decisions. Remove tax incentives, lighten up patent protections (figuring out how much to lighten up will be controversial) and let the free market roll.......... That would be congruent with my original position.

We're probably more in agreement that it first seemed.
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Old 02-26-2013, 03:36 PM   #163
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I understand. But remember, we also don't know what the impact of shifting additional resources away from other endeavors and into drug research will have on society. As discussed above, perhaps the pirated resources would have just been wasted on, for example, dumb gov't projects. Or, maybe those resources would have been used to keep terrorists from getting poison into the Dallas drinking water supply. Or have payed for a doc to work in a impoverished area. We don't know. We're allocating some percentage of our resources to drug research today. How much more do you want to pull from other endeavors? When will we know we've hit the "sweet spot" and aren't spending money on diminishing returns?

Resource allocation is hard. And controversial.

I can tell you didn't work in manufacturing process development. Before beginning a manufacturing process cost reduction project we'd identify what we would change and what the resulting savings would be. For example, we might note that adding a clean room environment to the process at a cost of $1MM would eliminate the $2MM of rejected lots we had last year. We'd base this on research that showed working in the clean room environment reduced the ppm level of contaminants by X%. And so on and so forth. Then we'd do the project, measure the outcome, and hopefully meet our goal. We weren't always successful but generally anticipated savings targets were met.
Agreed that research allocation is hard... which is why the free market is better at allocating resources than gvmt fiat....


Your last example is not valid... doing drug research is not the same as doing a cost study in a manufacturing environment... there was no research in your example.. there was a cost/benefit analysis....

The 'research' was the group that actually did the testing of the first clean room to determine IF you could reduce contaminants.... someone had to build the clean room and determine the results... and maybe after spending that $1 million to build the first one, it was determined that it saved very little... therefor, nobody else was going to build clean rooms...

After the reseach is done, it is easy to do that cost/benefit analysis you mentioned... but prior to it being done, you only have an idea (or WAG) of how much it will save... but you are not sure until it has been done...
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Old 02-26-2013, 03:46 PM   #164
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Agreed that research allocation is hard... which is why the free market is better at allocating resources than gvmt fiat....
More agreement. Today, there is lots of politics and gov't involved in resource allocation decisions involving research.
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Your last example is not valid... doing drug research is not the same as doing a cost study in a manufacturing environment... there was no research in your example.. there was a cost/benefit analysis....

The 'research' was the group that actually did the testing of the first clean room to determine IF you could reduce contaminants.... someone had to build the clean room and determine the results... and maybe after spending that $1 million to build the first one, it was determined that it saved very little... therefor, nobody else was going to build clean rooms...

After the reseach is done, it is easy to do that cost/benefit analysis you mentioned... but prior to it being done, you only have an idea (or WAG) of how much it will save... but you are not sure until it has been done...
OK, I'm not going to argue semantics with you. I was never a theoretical scientist working on open-ended research. I was a blue-collar factory worker focused on making stuff. Admittedly, things like research, cost-benefit analysis, design, development, performance improvement, variation reduction and repeatability and similar start to blend together for me. I always had dollar goals and deadlines to meet. Never got to just play, open-ended, in the lab to see what might happen.......

So, OK, whatever you say......
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Old 02-26-2013, 03:47 PM   #165
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As I said, resource allocation is tough stuff. No one wants to recognize that resources are finite and no one wants to recognize that we can't allocate 100% of our resources to each of a zillion different projects and initiatives. The 100% has to be spread between ALL of them.

Regarding your idea of pulling the money from one of the many money wasting and possibly redundant areas of the government budget............ based on the discussions in Washington today, every penny the gov't planned on spending in 2013 is absolutely, positively critical. And you want to pull some for your projects? Not possible according to our politicians. Every penny they're spending, and more, is needed to be spent just as they've planned. Aren't they jerks?

Anyway, I'm delighted you had favorable results with your cancer. I recently had a friend go through chemo for NHL and he was told that the available drugs just a few years ago would have been harder on his body and less likely to have cured him. Still, my point is about resource allocation. Cures are good. But do we spend 100%, 99%, 98%, XX% of our total resources on developing them?

If we can't do everything we want, what do we do?
Thanks I didn't have to have chemo (which was unusual) - just major surgery - and am cancer-free as far as I know. Despite that, it totally screwed up my life.

The simplemindedness and stupidity of politics never fails to impress me. They continue to exceed expectations... but not (generally) in a good way. All programs are essential....

The reason I'm focused on basic science research is it's applicable to more than one disease. AIDS research was like that, for example - a lot of information came out of that research that could be applied in other areas. It's easier and smarter to justify funding and spend money on research that might have broad applications.

The system is FUBAR.... I think, at the moment.
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Old 02-26-2013, 03:47 PM   #166
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Some of the biggest drug companies are based in Switzerland. But the Swiss, who are rich, pay less than we do.

Oh and here's another dirty secret. The biggest drug companies spend more on marketing than on R&D. Not just TV commercials but hiring attractive women to call on doctors to prescribe their products.

They reap huge margins too and even if a patent expires, they modify a few molecules and get a new patent.
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Old 02-26-2013, 03:52 PM   #167
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Oh and here's another dirty secret. The biggest drug companies spend more on marketing than on R&D. Not just TV commercials but hiring attractive women to call on doctors to prescribe their products.
If you're in a doctor's office, you can almost always tell who the pharmaceutical rep is: expensive suit, extremely careful grooming - I believe I heard they like women who were cheerleaders. I'm serious!
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Old 02-26-2013, 03:59 PM   #168
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I believe I heard they like women who were cheerleaders.
I like 'em too! Ya got a problem with that?
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Old 02-26-2013, 04:02 PM   #169
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Some of the biggest drug companies are based in Switzerland. But the Swiss, who are rich, pay less than we do.
So that's why my doc, that no good bastard, wears a Swiss watch and has a bowl of Swiss chocolates on his desk! Once he's had his way with the Swiss cheerleader, looked at his Swiss watch and munched on the Swiss chocolates, he bills me for it all!
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Old 02-26-2013, 04:06 PM   #170
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So that's why my doc, that no good bastard, wears a Swiss watch and has a bowl of Swiss chocolates on his desk! Once he's had his way with the Swiss cheerleader, looked at his Swiss watch and munched on the Swiss chocolates, he bills me for it all!
He obviously needs to learn to share.
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Old 02-26-2013, 04:15 PM   #171
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I'll help. You will love this one Midpack!

However, smokers die some 10 years earlier than nonsmokers, according to the CDC, and those premature deaths provide a savings to Medicare, Social Security, private pensions and other programs.

Vanderbilt University economist Kip Viscusi studied the net costs of smoking-related spending and savings and found that for every pack of cigarettes smoked, the country reaps a net cost savings of 32 cents.

Do smokers cost society money? - USATODAY.com

It's all how you interpret the data, I guess. It is kind of humorous that the data could be interpreted different ways from what is traditionally believed. I would certainly guess the bean counters at Medicare and the Social Security Offices would probably prefer everyone over the age of 18 to light up.
A provocative article indeed.

Kip Viscusi is a Vanderbilt economist as you noted, earlier at Duke University and also a prominent paid consultant of the tobacco industry and Phillip Morris specifically going back about 20 years.

Viscusi has stated that “As measured by short-run price responsiveness, people are no more addicted to cigarettes than they are to lawyers or the opera” people are no more addicted to cigarettes than they are to lawyers or the opera.”

He was used as an expert in Mississippi's lawsuit against the tobacco industry.

So I'm not quite ready to hitch my wagon to your source.

I wish I could see the numbers he used to arrive at his conclusions, I can't find them. Is he saying the average lifetime health care costs for a smoker are lower than the average non-smoker? Or is he saying the costs to society are lower due by using reduced Soc Sec and pension benefits and/or cigarette taxes to offset?

W. Kip Viscusi - SourceWatch

http://www.nber.org/papers/w4891.pdf?new_window=1
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Old 02-26-2013, 04:38 PM   #172
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A provocative article indeed.

Kip Viscusi is a Vanderbilt economist as you noted, earlier at Duke University and also a prominent paid consultant of the tobacco industry and Phillip Morris specifically going back about 20 years.

Viscusi has stated that “As measured by short-run price responsiveness, people are no more addicted to cigarettes than they are to lawyers or the opera” people are no more addicted to cigarettes than they are to lawyers or the opera.”

He was used as an expert in Mississippi's lawsuit against the tobacco industry.

So I'm not quite ready to hitch my wagon to your source.

I wish I could see the numbers he used to arrive at his conclusions, I can't find them. Is he saying the average lifetime health care costs for a smoker are lower than the average non-smoker? Or is he saying the costs to society are lower due by using reduced Soc Sec and pension benefits and/or cigarette taxes to offset?

W. Kip Viscusi - SourceWatch

http://www.nber.org/papers/w4891.pdf?new_window=1
I certainly don't know "the truth", Midpack, but there are other sources/articles all over that says that. That is why I said it is how you want to interpret or maybe manipulate the data. I know I have read before that smokers generally do not get Alzheimer's thus stay out of expensive nursing homes due to the fact they die earlier. Also, I have read that lung cancer is generally a "cheaper cancer" to treat due to the fact it's generally not detected early and is in an advanced state when diagnosed, thus patient doesn't live as long. Whether this is all true, I don't know. But one thing is for sure, I am not going to start smoking to help lower healthcare costs for society.
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Old 02-26-2013, 04:49 PM   #173
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Why are medical bills killing us?

Let's see..some that come to mind....

- many folks don't take care of their own health

- drug companies make big money

- costs vary so much that often cost isn't known until after the fact
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Old 02-26-2013, 04:50 PM   #174
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The issue is your condescending and abrasive manner of posting.
I'll appreciate your assistance in rewording what I write to get the same questions answered, without offending the person I'm asking.

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I don't think we have to pull resources from health care to do more basic research - just put more $ into doing research. Pull it from one of the many money-wasting and possibly redundant areas of the government budget. I don't know which one. But it doesn't have to come out of the healthcare "pot", IMHO. In fact, had we gone to single payer insurance.... who knows, we might have saved money?
I agree. We don't need to choose between various good options. We need to use our innovative minds to find a way to capitalize on all of the good options.
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Old 02-26-2013, 08:38 PM   #175
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I wish I could see the numbers he used to arrive at his conclusions, I can't find them. Is he saying the average lifetime health care costs for a smoker are lower than the average non-smoker? Or is he saying the costs to society are lower due by using reduced Soc Sec and pension benefits and/or cigarette taxes to offset?
I have read at various places that lifetime health costs for the obese and those for smokers are less than those for the non-obese and the non-smokers. This is because the obese and smokers tend to die sooner and therefore have lower lifetime health costs even after accounting for treating for illnesses associated with smoking and obesity. I see more support for this as to smoking (since they die earlier than the obese). However, how credible that research is I don't know:

The Burden of Healthy Living - Hit & Run : Reason.com

PLOS Medicine: Lifetime Medical Costs of Obesity: Prevention No Cure for Increasing Health Expenditure [Dutch article -lowest lifetime health costs for smokers, obese higher but not as high as non-obese non-smokers - This is the article most everyone cites to]

Alcohol, Obesity and Smoking Do Not Cost Health Care Systems Money - Forbes

Lifetime Medical Costs Of Obese People Actually Lower Than Costs For Healthy And Fit, Mathematical Model Shows

Center for Business & Public Policy

But not everyone agrees - Death, Taxes, Soda and Fat - NYTimes.com [talking about obesity not smoking]

As America's waistline expands, costs soar | Reuters [Again, about obesity not smoking]
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Old 02-26-2013, 08:52 PM   #176
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I have read at various places that lifetime health costs for the obese and those for smokers are less than those for the non-obese and the non-smokers. This is because the obese and smokers tend to die sooner and therefore have lower lifetime health costs even after accounting for treating for illnesses associated with smoking and obesity. I see more support for this as to smoking (since they die earlier than the obese). However, how credible that research is I don't know:

The Burden of Healthy Living - Hit & Run : Reason.com

PLOS Medicine: Lifetime Medical Costs of Obesity: Prevention No Cure for Increasing Health Expenditure [Dutch article -lowest lifetime health costs for smokers, obese higher but not as high as non-obese non-smokers - This is the article most everyone cites to]

Alcohol, Obesity and Smoking Do Not Cost Health Care Systems Money - Forbes

Lifetime Medical Costs Of Obese People Actually Lower Than Costs For Healthy And Fit, Mathematical Model Shows

Center for Business & Public Policy

But not everyone agrees - Death, Taxes, Soda and Fat - NYTimes.com [talking about obesity not smoking]

As America's waistline expands, costs soar | Reuters [Again, about obesity not smoking]
Isn't it funny that dispite some of the examples like this mentioned here, you never really here it debated though. Well one thing is for sure, whether it is true or not, the insurance companies want you healthy until Medicare age. Whatever happens after 65 isn't really much of a problem to them, financially.
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Old 02-27-2013, 07:53 AM   #177
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Thanks Katsmeow and Mulligan, counterintuitive to say the least. Knowing that smokers, alcoholics and the obese have higher health care costs on average to age 56 or thereabouts - the conclusions of the links you point to (they look credible enough) says something substantial and potentially disturbing about end of life health care costs and spending on same. But I'm not asking to debate end of life costs...

And I haven't wrapped my head around the above with the other slice shown below. I wonder what the causes are for the top 10% of health care costs, end of life largely and not cancer, heart disease, etc.?
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Old 02-27-2013, 08:16 AM   #178
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Lots to say on this topic!

First, doctors in other countries don't leave med school with an Everest of debt, as do many American physicians. (And yes, I'm a "doctor" but not an MD or related!)

And have had cancer three times (picked the wrong mother). I've received state-of-the-art care, and wretched care. The price seems to be only a bit higher for the wretched care.

The insurance company and employer recently went to a "partnership" plan. Good, thought I, before they came after me with nagging phone calls to do "something"--what, I've been unable to determine, as they have no info about me. I have been a long-time Lifetime member of Weight Watchers, exercise 10 hours weekly, kept 50 pounds off for 9 years, take my meds daily, have never once smoked (having to leave one's aunts houses to vomit in the back yard as a young child can prevent that habit easily), don't drink. Okay, so they want me to go to my checkup. Fine --did that, attempted three times to input it into their system and it never appeared. Of course each time I had to pull up my medical records and 30 minutes or so. Let's not even get into why I have to tell THE INSURANCE COMPANY that I had had my checkup.
Finally I decided to deal with my anger over this as my contribution to the unemployment crisis as they had of course to hire a whole raft of people to call people up and nag them.

So I have no solutions. Yet I agree people should take some responsibility, and the system, if we can call it that, is indeed FUBAR.
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Old 02-27-2013, 08:46 AM   #179
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Interesting, I would have guessed wrong on many of these. I also found lists of the most expensive medical procedures, but that's not what's relevant here. And end of life costs are indeed the most expensive by a wider margin than I hoped...
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The ten events or conditions that are most commonly expensive are as follows. These are average costs, so many patients even with these conditions will not reach the $100,000 per year mark:

1. HIV $25,000
2. Cancer $49,000
3. Transplant $51,000
4. Stroke $61,000
5 Hemophilia $62,000
6. Heart Attack including Cardiac Revascularization (Angioplasty with or without Stent) $72,000
7. Coronary Artery Disease $75,000
8. Neonate (premature baby) with extreme problems $101,000
9. End-Stage Renal Disease $173,000
10. Respiratory Failure on Ventilator $314,000
The 10 Most Expensive Common Medical Conditions - Forbes
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Old 02-27-2013, 10:01 AM   #180
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Interesting, I would have guessed wrong on many of these. I also found lists of the most expensive medical procedures, but that's not what's relevant here. And end of life costs are indeed the most expensive by a wider margin than I hoped...

The 10 Most Expensive Common Medical Conditions - Forbes

Thanks for posting, very interesting. It is important to keep in mind that these are averages. They point out that 40% of cancer patients receive treatment that is less than $14,000, so that really brings down the averages from some that incur very high expenses.

His last few paragraphs keep me thinking that high-deductible policies are a reasonable way to go, just as with most other insurance. Not a solution, but a piece of the puzzle. I wish my employer-retiree plan included a high deductible option.

-ERD50
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