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To: The_Reader_David
First of all thank you.

To comment on your reply, I may be misunderstanding your point, but the monopolies you referenced are not created because they are unregulated, but are created because of regulation. Regulation always creates some degree of monopolies, whereas deregulation promotes competition. I would like to see a push for more drugs moved from requiring prescriptions to over the counter status and I would like to see the number and type of professionals that can prescribe drugs expanded, such as nurse practitioners and even nurses for some drugs. I do believe there is some role for government licensing of professionals such as doctors, nurse and civil engineers where public safety is involved. Determining the optimal amount of regulation is always difficult and controversial, but necessary.

Although the supply of doctors is restricted by licensing, doctors’ pay plays a minor role in overall health care costs. The main reasons health-care costs are so high are, 1) the high and unnecessary cost of the insurance bureaucracy for routine care, 2) freeloaders who don't pay for their health-care (the uninsured many who are illegals), 3) unjust malpractice suits, 4) misallocation of resources due to market distortions caused by third party payers (primarily government and insurance companies) and 5) unnecessary regulation, mostly of hospitals and medical device manufacturing.

Patents are actually a constitutional right, although one every engineer has to sign away as a condition of employment. Patents do promote investment in research and development by the private sector. Without patent rights, new drug development would cease unless funded by the government or possibly charities. Effective and safe pharmaceuticals are extremely difficult to invent, but in most cases relatively easy to manufacture. Without the monopoly provided by drug patents, the development of new drugs would be a losing proposition.

55 posted on 04/22/2014 4:50:22 PM PDT by Pres Raygun (Repent America)
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To: Pres Raygun
Of course the monopolies I cite are a result of regulation. All monopolies (or at least all monopolies that can effectively abuse their monopoly status to the harm of consumers) can only exist with the support of the state. In a free market (the existence which, incidentally, does depend upon the existence of certain sorts of regulations -- read Luigi Zingales A Capitalism for the People for a clear and expansive explanation) the only way to prevent competitors from arising is to provide good service at fair prices so that new entrants cannot get traction in the market.

However, patents are not a constitutional right, but a constitutional prerogative of the Congress. It doesn't have to grant them. It doesn't have to grant them under the current terms. For life-saving drugs and medical device, I'd advocate a regime under which the developer can chose between a short-duration monopoly with unregulated prices, and a long-duration monopoly with regulated prices. And I'd subject *all* patents to much closer scrutiny for lack of obviousness -- in the case of pharmaceuticals (albeit not life-saving drugs) the patent on esomeprazole (Nexium) was plainly an abuse of the patent system.

I also think you underestimate the degree to which the unnecessary cost of insurance bureaucracy is a creation of physicians. The whole system of CPT codes which govern insurance reimbursements by minutely classifying medical procedures is a creation not of the insurance industry, but the American Medical Association, which collects monopoly rents on the basis of its required use.

56 posted on 04/22/2014 5:29:00 PM PDT by The_Reader_David (And when they behead your own people in the wars which are to come, then you will know...)
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