Thursday, July 21, 2011

Rising Medical Costs: A Case Study or, How the Grand Trifecta of Government Intrusion Into the Free Market Screws the Rest of Us

My family is once again growing. The soon to arrive boy or girl will be joining the family of my niece and her husband who only four years ago blessed us all with twin boys. I wrote about their miracle here.

Those births occurred with myriad complications and the final medical bill landed well within seven figures.

In America we have to admit a couple of things. First, we have to admit that our medical community is the most advanced and successful on earth. Second, we have to acknowledge that it is expensive.

One of the evil villains in the rising cost of medical care in this country is the pharmaceutical industry. Sure, doctors are also greedy, as are nurses, as are hospitals, as are those who test your gross blood, your disgusting stool, and your even more disgusting growths. And, let us not forget the greed of ambulance providers, insurance companies, and anyone else remotely involved in the providing of medical services. Yet, somehow, when we are in need of their services, we manage to grovel back to these too-rich (and competent) devils and pray that they save our lives and make the pain go away.

And, with every advancement, costs rise.

Too often absent from the accusations lofted at medical providers over the cost of our best-in-the-world care is our beloved government--the largest and most benevolent corporation on earth.

Which brings me back to my expectant niece. Because of the premature birth of her twins, she is at very high risk of premature delivery of this next child. Her doctor has dealt with this the same way that many doctors have routinely dealt with it for the past few decades--with the prescribing of a hormone called progesterone. The drug, delivered by injection once a week, is given to expectant mothers during at-risk pregnancies for up to the last 20 weeks of the pregnancy.

The cost per injection...about $20 for a total cost of approximately $400. Or at least it was.

Enter the US government in the form of the most benevolent FDA. New cost...$1,500 per shot, or about $30,000 for twenty injections.

How did this happen?

In its quest for a perfectly regulated society, the FDA determined that progesterone as it was produced for decades did not meet the standards that should be applied today. To wit the drug was manufactured by pharmacists and not under the heavily regulated umbrella of the federal government.

This could not stand.

Recently, the FDA granted a patent to the K-V Pharmaceutical Company for Makena, the new government approved form of progesterone.

K-V Pharmaceutical, having hurdled the quarter of a billion dollar cost of dealing with federal regulations for the delivery of the new drug, and then enjoying the virtual monopoly provided to it by the FDA for this product that a pharmacy could make in its back room for $10, the market cost for the brand new old medicine was increased overnight by 750%.

This is no problem for the evil rich, who most likely are insured and, if not, can afford the medicine regardless. It is no problem for the insured who will have it provided for them after coughing up a copay--the category that my niece falls into. It is no problem for the poor who, after levying the government, can have the note toted by Medicaid and the taxpayers. It is a problem for a growing number of families who are still employed by companies that can no longer afford to provide health care coverage for their employees.

Meanwhile, medical costs skyrocket, insurance rates skyrocket, consumer prices skyrocket for any product made by those who provide insurance to their employees, and America saunters one step closer to the cliff--all this while progressive thinkers scream for even greater regulation on everything from what we eat, drink, breathe, use, rent, buy, sell, or otherwise brush up against in even our most casual walks through life.

Do I hold K-V Pharmaceuticals harmless in this whole mess? No, but I recognize that they are acting in exactly the way that we would expect for a company to act that has just spent a fortune for the right to produce a product for which they have also been granted a government monopoly. Really, that is exactly what we should expect from companies that feast off the nectar of a benevolent government bathed in fascism; a government whose two main priorities are to guarantee safety in all aspects of our dangerous human existence, followed closely by an insurmountable desire to make certain no members of society act in a manner not blessed by the collective.

Lets multiply this by the millions of intrusions the government makes in the free market every day. Increase regulation. Restrict individual choice. Squash competition.

It is the grand trifecta of a well-engineered benevolent state. Freedom would be cool, that is, if it wasn't so darn dangerous.

Epilogue: Due to great consumer pressure, K-V Pharmaceuticals has made some price changes to its product and claims it is now priced only about 330% higher than it was just a few months ago. Thanks.

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