Why Should Americans Be Grateful for $137 Insulin? Germans Get It for $55
nytimes.com
nytimes.com
When I was in the US, I needed an inhaler. It cost $250 to see the doctor and the inhaler was $150.
In the UK. It costs £0 to see the doctor and for the inhaler now is £8.80. Although I remember a time when it was £4.
Americans pay way too much for healthcare.
In Scotland prescriptions are "free", i.e., I don't pay anything for my inhalers, or anything else prescribed by my doctor.
This costs the Scottish health service £1.3bn (https://www.scotsman.com/news/bill-for-prescriptions-in-scot...). I don't know how sustainable that cost will be, but I don't hear anyone complaining about the policy, except for opposition parties.
I also pay 1.45% of all income for Medicare, which I will not be eligible for until I'm 65, a few decades away. My employer pays an additional 1.45% on my behalf and I pay an additional 0.9% surcharge on all household income over $250k.
I'd love to start my own company but health insurance costs are a big impediment. I have young kids, I can't leave my family underinsured. We're healthy now thankfully, but what if one of us gets cancer or is in a car accident and we're hit with $500k+ bills (or worse - if we can't get the right treatment)? I don't know how other people do it.
That said, don't worry that you do not get enough back from your health insurance. This will come soon enough when you get older ;-)
Intellectual property law is a way for government to grant exclusivity to one firm. This whole "you can get it for x in Canada and y in Germany" is a silly conversation. It's not like it costs 1000x to manufacturer the drug here vs there. The R&D and marketing costs are amortized over the period of exclusivity. Saying "you can just go to Canada to get it" just means "im going to circumvent intellectual property law." It's kind of like, but not quite, piracy. You're choosing where and when which laws apply to you. It also kicks the can down to the rest of the people buying the drug, because we know the pharma actuaries arent going to price their drug at a loss. And then on top of that, like you say, these prices people pay AFTER insurance arent what the cost of the drug is to the population, its an already subsidized price.
Germans and Canadians are getting the drug cheaper not only because they have different laws, but because the R&D recovery isnt evenly split between country, they take their money where they can get it.
Insulin SHOULD be generic by now (the patent on long-acting synthetic insulin expired in 2014), but the companies continually improve it and always sell the latest variant. And of course Doctors are going to prescribe what works best.
1. A lot of drug patents are bought by hedge funds that just raise prices to reap profits and never invest in R&D
https://www.nytimes.com/2015/09/21/business/a-huge-overnight...
2. Drug companies spend more on marketing than R&D:
https://www.washingtonpost.com/news/wonk/wp/2015/02/11/big-p...
3. Because of lobbyist, Medicare can’t negotiate drug prices - unlike the VA in the US and every other country.
https://www.forbes.com/sites/johnwasik/2018/08/10/why-medica...
This point, which always comes up in these threads, has already been debunked both in those other threads, but it was even debunked here before you made this comment.
I have never heard of such outrageously priced healthcare plans (private providers excluded, of course).
Basically, the insurance cost is a percentage of income (14.6%) up to 4,537.50 €/month (gross income). If you earn more, your absolute health insurance costs will stay the same at 662.48€.
Keep in mind that in Germany, half of your health insurance is covered by your employer (by law).
Edit: The above is for the "public" insurance system, as noted in the comments. If you are above the Beitragsbemessungsgrenze, you can opt for private insurance which will very likely be significantly cheaper while you are young. But it carries the risk of steep price hikes which you might not be able to handle later in life (think retirement). And the path back into the public system is not straight forward and might include having to file for personal bankruptcy or similar drastic measures.
(Details:
You can go back once you're covered by public insurance for 12 months, no matter through which status, so family insurance helps get these months. For family insurance your income needs to be below EU435/month + some exceptions.
The outcome changes a bit when you're older than 45 because you need ~20 years (in raw terms: more than 90% of the second half of your working life) in total in the public insurance scheme to be able to apply for the "public health insurance for pensioners" system when you retire. That complicates matters.
Even more details for people not used to the German health insurance system:
By default people are in the public health insurance system. Exceptions are self-employed folks, public officials and people with income beyond the cap mentioned upthread: they can choose whether to use the public system or some private health insurance.
The reason why you can't just move from private insurance to public insurance is that otherwise the private insurers would try to get ahold of all the healthy youngsters and their (usually significant) money while offloading them to the public system as soon as they start to cost more than they bring. That would break the economics of the public insurance system.)
Are you sure you don't mean total social security (of which health care is a subset) with that number.
Because that's how it is here in Austria. The deduction for social security is significant, but health care is only a small fraction of it.
Edit: I checked and I stand corrected, thanks to the replies clearing this up.
When I take an average salary (3000 euro monthly gross salary) and put it into a tax calculator, the net salary comes back as about 1950 euro, so the different between gross and net salaries is about 35% in that tax bracket.
So if you earn EUR 1000 (just to have a nice round number), it's EUR 150 for health insurance, of which EUR 75 come from your gross pay, and another EUR 75 are itemized as coming from the employer.
That makes the 14-15% look scarier than they are (for the employee).
I find this perfectly valid and think we should get rid of private health insurance at all. It's undermining our system, pretty much like pension for state workers and alike. We really need to unify this system, imho.
> I paid 500€ per month for healthcare
You misquoted that as:
> 500EUR for your use of healthcare that month
(Emphasis mine.) Their original statement was correct (assuming that is what they paid!) and didn't sound like a complaint to me, just a factual correction.
The premium is based on your monthly salary.
If you’re not free not to pay it it’s a tax. It may be a well designed, special purpose tax that stops people doing stupid things but it’s still a tax.
If you pay taxes, the state may do whatever it suits with the money. If they decide once day to no longer maintain the public infrastructure using your taxes but instead increase politicians salaries they are free to do this.
If you pay an insurance, on the other hand, you have a legally enforceable right to receive the insurance benefits if you meet the pre-defined criteria for an insurance case.
In German law the insurance contribution may not be a tax because payment of it entitles you to certain services. That doesn’t stop it being an involuntary payment, mandated by the government, a tax by common definition.
That doesn’t make the legal definition wrong, but it isn’t really relevant outside a legal context just as a chef won't argue with a botanist that actually a tomatoe or a pumpkin is a vegetable not a fruit. Botanically they’re right but who cares?
https://en.wikipedia.org/wiki/Tax
A tax (from the Latin taxo) is a mandatory financial charge or some other type of levy imposed upon a taxpayer (an individual or other legal entity) by a governmental organization in order to fund various public expenditures.[1] A failure to pay, along with evasion of or resistance to taxation, is punishable by law. Taxes consist of direct or indirect taxes and may be paid in money or as its labour equivalent.
They also get Humalog much cheaper[1]. £29.46 vs $240.18
There's no sane way you can see discrepancies like this and not see something untoward happening.
[0]: https://bnf.nice.org.uk/medicinal-forms/salbutamol.html
[1]: https://bnf.nice.org.uk/medicinal-forms/biphasic-insulin-lis...
Kind off, people do pay national insurance, also a part of the overall tax goes into the NHS as well.
In England* there is a cost (£9250/year), but it's slightly misleading to think of it like that because of how Student Loans work here.
You pay nothing on your Student Loan up to a certain income (£25k, or $33k), 9% past that point, and then the remainder gets forgiven after 25 years. So in practice, it's an additional marginal tax rate for having gone to university.
(* different elsewhere in the UK - e.g. free in Scotland)
Lots of proponets of our system avoid mentioning this when comparing, but it is dishonest and gives an incomplete picture. Total taxation in Norway is 50-75% of gross pay, for an average employee (of which only 50% are employed in the private sector).
It's easy to look at your own tax receipt and think it's expensive but a) it's a boatload cheaper than it would be (cite: US healthcare atrocities) and b) not everybody earns enough to pay tax in these countries.
The people in group b still get treated. Equally. You're not left to suffer and die of readily treatable chronic conditions if you can't afford tax.
I bet manufacturer (pharma company) receives only $2 or less of these money.
Seems an odd restriction, but it explains why I didn't find it.
Also, if you don't have a job or if you don't earn over a certain amount it won't cost anything at all.
Prescription requirements for ordinary inhalers is a time-wasting money-making scam run by doctors.
But they want it that way.
They see us over here in Europe as some kind of "socialism" because our taxes will also go into public healthcare, so you don't have to worry about whether you can pay the bill if you have to see a doctor or go to the hospital.
Call it "ease of mind" or whatever you want, but I prefer paying monthly, although if not using it, over anything else.
edit: As someone pointed out, this might even come out to 0 once you get older and probably get ill more often or need more expensive services. So, it looks unfair when you're young and healthy but it will help you once this changes.
very much this.
It's like playing in a lottery that you win almost every month, and if at some point you lose, you get a lot of money.
When healthcare cost is being discussed, the cost on society should be what's being discussed, not to what extent it's paid for by tax money. Those are two different things and they're only slightly related (in that if healthcare is perceived to be cheaper, people might use it more, which may drive up total cost) (or drive it down through better prevention).
Edit: To be completely fair, that probably explains why they have to pay it, not why they should.
https://www.snopes.com/fact-check/members-congress-health-ca...
Sanofi sells it at $3 (208 INR) https://www.medindia.net/drug-price/insulin-lispro/insuman-r...
Humalog(3ml) sells at $7 (544 INR) https://www.medindia.net/drug-price/insulin-lispro/humalog-3...
Humalog (3ml) sells at $94 in USA: https://www.drugs.com/price-guide/humalog
- It would be helpful (and honest) if the article discussed the rate of demand in both / any / all countries.
- Why only Germany?
- Why only Insulin?
No doubt, the USA healthcare systems has issues that need to be addressed. However, that's not where the problem starts. The truth is, it's no worse than the (attention to personal) health of the majority people using the system.
BTW, I caught bit of the (new?) PBS feature on Cancer a couple nights ago. At one point, one of the doctors being interviewed said (paraphrasing): "We could reduce the rate of cancer by 50% if we were willing to adopt the changes[1] that have already been recommended. No additional research required. 50%!"
[1] Diet, lifestyle, etc.
The culture around food is completely destroyed. Social gatherings revolve around unhealthy food. There is generally not the understanding that the choices for what you eat is the major reason for obesity. The poor are lied to so much, they don't know what to believe, and the prevailing opinion tends to be that it is mostly due to genetics (how could that be, we have the same genes as 1-2 generations ago) or character (laziness, but I was obese in the past and worked a full time job and two part time jobs). In the past, the poor would get info from cable news, or not at all. Today, they get their news from Dr. Oz feeds on Facebook telling them to lose weight with various forms of snake oil.
While there is quite the gym culture in the U.S. in upper middle class, lower class does not have money for the gym, but mainly their metabolism is so shot from the foods they eat that they don't have the energy to go to the gym.
The government and the medical field in general could do a lot to move the needle on the terrible food culture, but they don't. They in fact made the terrible food pyramid, that tells people to eat grains above all else, and says nothing about the processing of the foods that they eat. And the foods they eat are processed to the nth degree. When I eat with some of my old friends or family that are still a part of my old culture, I am always amazed by how terrible the cheap food is here. It really doesn't even taste like food. Potato chips, rubbery chicken nuggets, soda, Totinos pizza, TV dinners, Hamburger Helper, I could go on...
I wanted to reply to this directly.
Yes and no. Nothing is more personal than what you put in your mouth. It's not just to blame others for those decision(s) / action(s). Could more be done? Yup. But gov + med are not the only ones dropping the ball. How many times does a doc have to say "You've got to lose weight" before they give up, and are "forced" to write a script for meds X, Y and Z?
I mean, when you step up to the toilet, you look down and can't see over your belly and see where your pee is coming from, isn't that a red flag? Maybe the trip to the all you can eat buffet isn't a good idea?
I see it (much) differently. Healthcare, is just like everything else. That is, Supply & Demand applies.
Furthermore, the providers can also use "price what the market will bear." Consumers have no choice. Well, they do, but they choose food + lifestyle that makes them ill.
Remove __unnecessary__ (read: preventable) demand and prices will have only one way to go. That is, down. The cost of procedures will fall. Insurance premiums will fall, because they're paying out less.
My point is, we can't keep living such unhealthy lifestyles and keep blaming the healthcare system. That's deceptive and naive.
< sidebar >
Supply & Demand was one of the dirty secrets of the ACA. More people were jammed into the system, but supply was not increased. Sure, in theory these new consumers were said to be younger and healthier. None the less, even if they used the system 25% as much, that was still an increase in demand (and none in supply).
In theory it was "easy money" for the insurance companies, but it did not address S&D. That is, the ACA, to some extend, robbed Peter to pay Paul.
Prices continue to climb, as does the obesity rate, etc.
< /sidebar >
The article fails to mention the average price to the end patient in both countries, but this would still show a gap as in Germany the cost to the patient for their prescription insulin is, I think, about 10 euros.
Rate of demand per country makes little difference due to global distribution but apparently Germany has 8.31% of adults with diabetes and USA has 10.79%. Many economists will tell you a larger market should equal more competition and cheaper prices, and not having those is a sign of unhealthy anticompetitive practises.
The exercise comment would only apply to some diabetes patients. It is possible to spontaneously develop diabetes whilst being in peak physical health and diet.
But, more importantly, the cause of a disease does not effect the price of the drugs to treat it.
Or it's an irresponsible cherry-picking of data.
So instead of debating a symptom (i.e., the price of Insulin) let's discuss some of the actual root problems.
Why would it make a difference?
I would expect the US to have higher levels of obesity and thus diabetes.
I would expect larger markets to benefit from economies of scale, so would expect to costs in the US to be lower.
You seems to be driving at something else though?
Good luck
If the article meant to be impartial it should also have included the rates of obesity and morbid obesity of germans VS americans, as this is one of the causes for adult-onset diabetes.
That card you just used has two sides: people who are born insulin-dependent are paying more in part because of others who could have avoided developing the illness.
Address the cause of the demand increases, and you're on the way to addressing the price as well as improving peoples' quality of life.
I used to be a heavy smoker and although I've quit, I'm acutely aware that if I ever need a cancer related transplant I'll probably not be given the same priority as someone with a congenital cause - and with good reason.
I made a lifestyle choice that can have serious consequences for my health - and the same goes for people who choose to overindulge on shitty food.
If anything the larger market, which is stable over time, with a product that is known and doesn’t require a lot of development & research, should be driving the price down as competitors should be pricing to gain more market share. But that’s not what’s happening, the companies are engaged in anticompetitive pricing.
Like I said, address the cause of the demand increase and you'll address both the price and provide and improvement to peoples' quality of life.
There is a scaling issue but my point stands, that demand & its growth are stable and predictable. These are companies with at least 5 & 10 year plans, so they’re able to match production to demand long term.
And my point still stands that preventative measures will have both a positive impact on peoples' health and on the demand for insulin.
Price gouging is definitely a problem that has to be addressed, but it's not the only one - yet seems to be what everyone focuses on first while glossing over the terrible lifestyles/habits of the population.
Just because there's more than one obvious problem doesn't mean that you can ignore the others.
More to the point, this isn't just about a single disease or drug, the same story applies to a lot of medication, including those that have zero lifestyle causes.
EpiPens are another example mentioned in the article. In the US if your child is born with a deadly allergy you have to carry around very expensive EpiPens that can cost hundreds of dollars due to co-pay and whatever. In Europe these will cost you directly less than $10 and even to the state will cost a lot less than it does to many US patients. One of the company's responses to hiking the price from $50 to $600 for profit reasons was to introduce a cheaper generic version, which as this article points out, is BS.
There's probably also an interesting conversation about effective cost: what does average Joe pay after taking deductions into account?
What's stranger to me as an American living in Germany is that you can't get it at "drug stores" like DM, Rossman, etc. that are the equivalent of CVS/Walgreens, let alone grocery stores. You have to get it at an apotheke (pharmacy) that's a separate business. In practice that means it's both more annoying (due to more limited business hours) and more expensive. No going to Costco to get a bigass bottle of more ibuprofen than any one family could reasonably use here.
But you can order it online at Amazon, oddly enough, though it's still much more expensive than in the states, and it looks like the largest size on offer is 50-count.
I get that German society is somewhat more regulated than in the US, but I just don't see what's the threat with basic medicines like ibuprofen that necessitates them being sold at specialist stores.
The theory is that it makes you think twice if you have to visit the pharmacy all the time. They won't sell you 10 packages at once either. Unless you rotate pharmacies all the time, at some point they will notice and ask you to consult the doctor to root-cause the issue.
That's the value pharmacies (are supposed to) bring, and it shows in that they have pharmacologically trained staff, while those drug stores hire whoever is able to operate a cash register.
In the UK you also can't buy more than 32 pills of ibuprofen/aspirin/paracetamol at once without prescription -- but the cost is 1-2 cent per pill because every supermarket including ALDI can sell them.
Sometimes doctors write a recipe that has to be mixed, and so the pharmacist can do that.
Of course since pharmacies are also for profit shops, this aforementioned role is less and less important, and there's a pretty constant push to make the publicly available (so doesn't require prescription from a doctor) drugs free to sell at any other shop. (Eg. 0-24 petrol stations.) Eventually that push will go through.
I don't know if you're using medicine as an official term here.
There are plenty of things that are medicine like, plenty of things that aren't risk free.
Peanut butter isn't risk free if you're allergic to nuts. Honey isn't risk free for young children. Alcohol isn't risk free.
This is absurd on its face. Even when I buy ibuprofen here, they still just sell it to me the normal way. They're not quizzing me about how much I'm taking or whatever. It's less convenient and more expensive for zero benefit.
I normally stock up on OTC medication like Ibuprofen when I’m in the UK.
https://www.deutscheinternetapotheke.de/ibu-400-akut-1a-phar...
https://www.walgreens.com/store/c/walgreens-ibuprofen-200-mg... is 100 x 200mg, so about the same, for USD 5 (plus taxes)
But in the US you also get much larger packages that just aren't available in Germany: https://www.walgreens.com/store/c/walgreens-ibuprofen-200-mg... is 1000 x 200 for USD 20, 10x the drug for 3x the price.
So yes, there are drugs that are cheaper in the US. There's also pretty solid reasoning behind why you won't find the larger packs in Germany: if you're in need of that, go to a doctor instead of ruining your kidneys through self-medication.
edit: I mean, do you take those regularly? That might be the problem at all.
Buy a 1000 pcs bottle, split up with 10 friends who get 100pcs each, split up the costs, save 4€ out of 6€ per person.
Tablets work out to 1.81p each (200mg) https://groceries.asda.com/product/ibuprofen/asda-ibuprofen-...
So £1.81 ($2.38) / 100 (according to google)
https://www.walmart.com/ip/Novolin-ReliOn-Insulin-R/12978348...
https://www.walmart.com/ip/Novolin-ReliOn-Insulin-N/16767244...
To be fair, Apple already does this. If you buy a refurbished Apple device, you are essentially getting a cheaper iPhone with slightly worse packaging.
This is not the same, because the device will still be Apple with the same design and logo. But the article is making different point that if Apple would sell also yPhone with same technical specs and slightly different design and half the price then it would be outragous.
P.S. They are paying that price the same reason why they pay 20x more for university than Europeans. It is the system that they live in.
Would it? Companies do this all the time; it's called differential pricing.
iPhone SE?
And guess where the korean specialists go to ? Yes it is the US of A.
With insurance my cost is 68$ US ... here in Germany without insurance it was 13$ EU
Insurance is socialism for profit and they are raking it in.
a few minutes later, and got some antibiotics
Insurance exists in Germany also and it makes some costs be lower, or even 0. Some medication will always have the same price regardless of your insurance status. But for example going to the hospital almost anywhere in Europe will never result in a tens of thousands or Euros bill for the patient.
This isn't a problem with the insurance concept, it's with what a government does with it.
so·cial·ism /ˈsōSHəˌlizəm/ noun a political and economic theory of social organization which advocates that the means of production, distribution, and exchange should be owned or regulated by the community as a whole.
In the US insurance has a profit layer making it socialism for profit. It really is that simple.
If you are getting a discount from you employer for your own products and services (cheaper Windows license as a MS employee) does this imply a socialist setup?
Check out the doctors who take cash only
https://www.moneycrashers.com/cash-only-doctors-no-insurance...
The reason costs go up is because in some countries someone sees health insurance more as an opportunity to line their pockets since there is less transparency on how the money is spent and the pool is so big it offers temptation. But this is a problem of implementation, not the system’s concept. This is corruption where “negotiations” with healthcare providers and pharma are more about commissions and bribes so the actual costs don’t matter.
Same as with the road building I mentioned above. Is rod building soacialist?
The article is about how companies are trying to avoid anticompetitive investigations by putting the exact same product in a different box and selling it for less but only to a smaller market.
The definition of socialism is complex and fluid so finding a perfect match is tricky but I do agree that in principle there are many practices between states and businesses that would be, in the US at least, shouted down as “socialist” if they were instead between the state and individuals.
Where I live different insurance providers offer different conditions. So depending on your needs and situation you would definitely find one offer far better than another. While there may be a "fixing" component hidden somewhere the system works very well and the result is both lower bills or even none for the patients, and lower bills for the insurance company. You don't see situations where the insurance would pay exorbitant amounts to the hospital because somehow applying a band-aid ended up costing hundreds [0]. Just because a system has a social component of responsibility doesn't make it socialist. It might just make it more useful and efficient.
[0] https://www.vox.com/2016/5/13/11606760/emergency-facility-fe...
In the US medical insurance additionally has an unchecked and largely unregulated profit layer.
It really is that simple.
Check the healthcare costs once more
- [In socialism]: the means of production, distribution, and exchange should be owned or regulated by the community as a whole.
Your claim:
- US insurance has a profit layer making it socialism for profit.
Question:
Which part of medical insurance in the US is produced, distributed, and exchanged by society as a whole?
The largest medical insurer in the US is a commercial entity UnitedHealth Group with a membership of 49.5 million people. It's 20% of the adults in the US, but still can hardly be called "society as a whole". And yes, these 20% have no say in how the insurance is produced, distributed, and exchanged.
Other insurers are, similarly, commercial entities, smaller in size, and people have no say in how the insurance is produced, distributed, and exchanged.
---
Also:
- is car insurance socialism?
- is accident insurance socialism?
- are public roads, public schools, police, firefighting, army, coast guard socialism?
Socialism for profit
In fact I just checked, DHL ships a parcel of 2kg from Germany to the USA for 18$, A 5kg parcel is 42$.
I've been reading NYT for a long while now, and I've been noticing more and more of these "medicines are more expensive here" trope.
There's half an answer isn't there? The US is subsidizing the development of these new drugs to the world, at the cost of it s citizens, as these companies operate all over the world and not just in US. The _relatively_ richer people in Cali can afford to pay $x more than the people in Bali.
Sure, the exploiting the people under the marketing guise of "patented" paracetamol varieties is _very_ unethical, and just slimy. That we can all agree on.
But every time such an article is posted, the only question in my mind is, "isn't the problem half explained?".
What's the alternative, not innovate and let everyone die? As opposed to innovate, and some people who live better than the others pay a bit (or in this case, ~2.49x) more ?
Is there an alternative where everyone pays equally ? Sure, you can lower the cost for an American and subsidize it (which comes from their tax again, so they're being more/less charged the same amount).
or you can increase the price for the rest of the world until the death toll vs affordability ratio looks good for the company that decides this is a good idea.
The problem is half explained.
The rest of the problem's explanation must lie here.
--- From the article:
Part of insulin’s price rise in the United States is because of the middlemen who buy the drugs on behalf of insurers and hospitals and negotiate discounts off the list price for their clients. So Lilly often doesn’t make the full $275 a vial (though, since rebates are secret, we don’t know how much less).
By selling an authorized generic, rather than merely lowering the brand’s price, Lilly is essentially doing an end-run around those middlemen and giving patients who don’t purchase through an insurer another option.
---
It's also a supply chain problem, not the manufacturing supply chain, but the business to customer supply chain.
I guess margins are not that wide enough for middle men to make anything significant in other countries except the states.
My tone in this comment is very inquisitive, not aggressive in any way, I don't mean to come across like that.
This is, apparently, a myth: https://www.washingtonpost.com/news/wonk/wp/2015/02/11/big-p...