We have been having the healthcare argument in the U.S. for decades. Often framed as a debate over whether people have a right to health care, it really focuses on one issue: paying for services. On one side of the debate is capitalism. On the other is socialism.
The reality of U.S. healthcare is such that no one is denied life-saving treatment. In fact, it is illegal for medical facilities to turn away people in need of life-saving care based on ability to pay. That is not even a matter of debate. We also don’t have a problem of delivery. This is proven by the fact that anyone can go anywhere to get just about any approved treatment.
That brings us back to the question of payment. We can learn a lot from the example of Americans purchasing Canadian drugs online. Such purchases tell a lot about capitalism. First and foremost, it tells us that capitalism works.
Prices Are Too High
The average American spends upwards of $1200 annually on prescription drugs and related services. Much of the expense is covered for people fortunate enough to have comprehensive prescription programs attached to their health insurance. For everyone else though, medications are paid for out-of-pocket.
Medication prices in this country are simply too high. But what is bad for U.S. pharmacies is good for Canadian pharmacies. Pharmacies north of the border are willing to sell the exact same prescription drugs to American consumers for a fraction of the price. Guess what? That’s capitalism working the way it should.
In Canada, drugs do not cost as much thanks to their regulatory regime. The U.S. regulatory system, combined with the way our health insurance system works, invites drug companies, distributors, and pharmacies to charge higher prices on most prescription medications.
More Than Enough Business
Canada Pharmacy is but one example of the many online Canadian pharmacies supplying mainstream medications to U.S. consumers. They aren’t hurting. There is more than enough business to keep Canada Pharmacy going month-to-month and quarter-to-quarter.
As far as our Canadian friends are concerned, high U.S. drug prices are a good thing. They would just as soon have them stay high perpetually. After all, their business model is based on it. What is surprising is that U.S. drug makers and pharmacies haven’t made any concerted effort to compete.
So what’s wrong with our system? It boils down to health insurance. When push comes to shove, the combination of private health insurance and the Medicare/Medicaid system artificially props up prescription drug prices.
Designed for Government and Corporations
The biggest downfall of our system is that it is designed to benefit government and corporations. It didn’t used to be this way. Prior to the Health Maintenance Organization (HMO) Act of 1973, health insurance was actually insurance. It protected people against financial loss in the event of a serious illness or act. That all changed when the HMO became a third-party payment system for healthcare bills.
The HMO system benefits private insurance companies and government bureaucrats more than consumers. Insurance companies earn profits on high-priced health insurance policies while the politicians pad their re-election coffers. It is a symbiotic relationship that artificially increases retail prices at the expense of consumers.
The fact that online Canadian pharmacies can sell American consumers the same prescription drugs at lower prices proves that the capitalist system works. We don’t need to eliminate our system in favour of socialized, single-payer healthcare. We can fix what’s broken by taking the power away from insurance companies and bureaucrats and returning to the way things were prior to 1973.