4 ms·
One of the reasons it costs less in the UK is because the NHS bargains the costs of drugs (and machinery etc) it buys down. This works partially because they ca
by fauldsh 15y ago
One of the reasons it costs less in the UK is because the NHS bargains the costs of drugs (and machinery etc) it buys down. This works partially because they can and do refuse to buy the drugs deemed too expensive. I don't have any statistics to back this up, but because the US system ends up spending as much as the pharmaceutical companies can possibly charge meaning they pay more for the same drugs. Somewhat of a perpetuating system, as the US pays more the pharmaceutical companies can handle the NHS bargaining the prices down some more. It's vaguely analogous to how the lesser paying medicare is subsidized by private insurance.
- wisty 15y agoNote the theory of second best - 2 monopolies (i.e. a union and the owner of a company town; or a health service and the monopoly owner of a patented drug) can negotiate a better and fairer deal than 1 monopoly and a fragmented party. 2 fragmented parties is best (in theory), but that doesn't always happen. But most economists don't learn this in school. They just learn "monopoly = bad, government = monopoly".