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Want To Halve US Medical Costs? Easy Just Break-Up The Monopoly

Politics / Healthcare Sector Aug 27, 2009 - 07:06 AM GMT

By: Andrew_Butter


Best Financial Markets Analysis ArticleAll government policy decisions come down to three choices:

(A): Create a monopoly and force the customers to pay whatever price they can be forced to bear. That's called parasite economics, the trick is not to bleed so much that the cow dies, (

(B): Create a huge state monopoly and control prices, that's how to make sure that everyone gets an equal quality of care (equally bad) except of course some end up finding ways to be more equal that others.

(C): Create a level playing field for free markets, make sure it's clean (anti-trust), make sure that anyone who wants to sell melanin-tainted milk or to commit financial suicide by (metaphorically) hijacking the plane and flying it into a building (like the shadow banks did), is prevented from doing that, and otherwise keep out of the kitchen.

The USA in the past has been in love with Option (A); the danger at the moment is that the "cow" (i.e. USA) will die. Everyone agrees, "something has to be done"; the parasites agree on that and so does the cow...Halleluiah there is non-partisan support for the project!!! (By the way I'm on the side if the cow).

President Obama has proposed a route to Option (B). So now we have a multi trillion lobby machine up against an in-experienced Democrat President, no points for guessing who will win (but don't worry they will throw him some crumbs and let him declare a victory (if he is a good boy)).  But they won't let him forget that the last popularist Democratic President to spoil for a fight with the Big Boys was President Kennedy, and look what happened to him.

And don't forget there is a LOT of money at stake, and like THE MAN said "there is not enough Gold in the whole World to satisfy the greed of one single man". And don't forget either, these guys have got more power at their fingertips that the whole of the Shadow Banking system, after-all they get to squeeze the prostates of all the Movers and Shakers.

I haven't been watching closely but the saga of the Obama administrations efforts to reform the US health-care system is like a deja-vue of when Hillary Clinton got herself sidelined from public life.

Healthcare looks like the ultimate trap that Republicans lay to get back at Democrats, there is no evidence that ploy won't work again, and even if something gets rammed through, it will be hacked about so much by the end that even if it could have worked, it won't.

The Democrats are right, USA cannot afford the cost of its current health-care, and it is becoming more and more unaffordable. The Republicans are right, when you let the State meddle with health-care, you don't save much on costs but quality goes out of the window.

How about the free-market view?
The free-market argument is that doctors provide a service and they should be allowed to charge what they want, and that's got nothing to do with the State.

Free-Market Rules!! And America is "The Land of The Free" Right!!

Wrong, the provision of medical services in USA is an obscene monopoly, that's not a free market;  at least Bill Gates produces a product under the protection of his monopoly that everyone can afford, and at least he has the human decency to be embarrassed when he is put on the spot (and do something positive about it; you can say what you like about Bill Gates but you can't criticize his Foundation), this monopoly doesn't even deliver that.

Stepping Back
I visit USA from time to time, every time I make sure I get medical cover, and every time I am amazed by how much it costs, it's three to four times what the same cover would cost anywhere else in the world. You get a choice of two boxes [√]...Anywhere else in the World [X]...USA.

I remember reading about some famous black "dude" who went half deaf because as a kid his parents couldn't afford to take him to a doctor to treat his ear infection. So he just lived through it until the bitter end. Do you know how painful a serious ear infection is? Try cutting off your ear with a hacksaw, and then when you are done try the other one.

That is simply obscene.

Anywhere else in the world either (a) he could have walked into any doctor and got the necessary treatment, or (b) walked into a pharmacy and had a 99.99% chance of getting the right treatment (which is a lot better than no treatment).

99.99% of the time the right treatment is penicillin (and yes smart-ass MD, pharmacists know about allergies), plus if he was lucky, chloramphenicol drops. But then most doctors don't know that and US doctors would probably never do that anyway because if you ingest the stuff there is a 0.0001% chance of getting an irreversible and fatal bone condition.

Of course there is not much chance of ingesting it, if you put it in your ear, but chance is a fine thing, and doctors never take chances when their lifestyle is at stake.

How do I know? Well thanks to the PH of my body (doesn't handle the primary source of infection which is typically a fungus), plus the anatomy of my ears, plus the fact I grew up in the tropics means I had a lot of ear infections as a kid; AND I AM NOT DEAF, but I do know how much they hurt.

And by the way, the advantage of chloramphenicol is that they don't use that antibiotic as a blanket addition to the feed in animal husbandry (for obvious reason, the cows fall over), so it's about the only antibiotic left (at least out-of-patent) that does not have serious resistance problems.

Funny how a farmer in USA can buy as much antibiotics as he wants, and feed it to his cows, so that resistance generally goes through the roof, (the fact it gets transferred from benign bacteria to pathogenic bacteria was known thirty years ago), so soon the only antibiotics that work will be the "great-new-very-expensive-patented-discoveries". Of course that wasn't a conspiracy...nor was the Kennedy Assassination.

But a poor black mother can't buy the stuff at a pharmacy without paying the $200 gate-fee to get to even see a doctor, plus then he will want to do "tests" to cover his ass. American doctors spend 60% of their training learning how to cover their ass, so schedule a brain scan ($3,000), plus a whole lot of other tests and you are lucky if you got change out of $10,000, and out of that she will get a prescription for penicillin plus (if she's lucky) chloramphenicol ear drops.

Both of those drugs are years out of patent, if the mother of that black kid had taken him to see the highly qualified, lovely, gorgeous, sympathetic, Mrs. Shah at the 24 hour pharmacy where I go to sometimes in Dubai, who speaks with an Indian accent that Peter Sellers would die for (Hinglish is her fifth language), that mum could have got the works for $12, plus the kid would have got a free, sugar-free sweet and a hug (all included in the price). And that's not a State-Owned-Pharmacy; it's free market all the way down the line.

But in America they do it different, and that's a disgrace.

That's the point you missed Mr./Ms "Land of the Free", free markets deliver low cost solutions; monopolies deliver a load of fat cats lording it around with the "customers" facing two options; "pay our price you deadbeat or get out on the street".

You really want to have cheap health-care in USA?

Well forget about the new bill, which has degenerated into some wacky idea of forcing insurance companies to sell insurance at a loss. Next step I suppose they could use the AIG to do that (well they own it after all); and they certainly have a lot of experience in that department. Then I suppose there could be another bail out, now that's sounds like a PLAN!


  1. Give a Green Card and a license to any doctor or dentist who is qualified in a half coherent country, and if not that sort of country, put out a test run by the State, not the medical profession. And let him practice in any State in the USA, and let American doctors practice in any State of the got a license in one (right now they can't).
  2. Ditto Nurses and medical technicians.
  3. Stop farmers from feeding antibiotics to their animals; shoot them if necessary.
  4. Allow qualified pharmacists to sell drugs without prescription (no not crack cocaine, the other sort)!

  5. Allow practitioners to elect how much malpractice claims they will pay with a cap, anyone who wants to buy medical services with an unlimited cap on what they can squeeze out of the person who screwed up, well, free market buddy, let them pay.

    If not, well what you buy is what you get, if you elect to buy medical services from someone who has a $500 cap on any liability he has towards you for malpractice, well go figure, if you bought the service from someone with an unlimited cap, it might be better quality (and there again it might not). That's free markets.

    I have no doubt that if the mother of that back kid could have bought  $12 worth of treatment from someone who carried no malpractice insurance, she would have taken the risk, gladly. Imagine you could look in the Yellow Pages, you could pick your doctor, (a) here is Mrs. Shah, go to her and you get a $500 cap, and (b) here is The World Famous, Dr. (Joey) Drake Ramoray, go to him and the cap is unlimited. Take your pick, free market rules.

  6. Same thing for drugs, and if a drug is approved in a recognized other country, allow it to be sold in USA, with a health warning, like tobacco. It is simply comic that the FDA makes such a big deal about approving drugs in USA, that by the time the process is finished, there is only a couple of years patent protection left, yet you can buy tobacco which is KNOWN to kill you and there are no legal restrictions on putting hydrogenated fatty acids (trans fatty acids) in food, when that poison is known to do more damage than tobacco, and the monopolists who make that stuff don't even allow a health label.

Do that and spending on medical services in USA will halve, at a stroke. I guarantee that personally. But just for the avoidance of doubt, do that and I give no guarantees about the health of the 43rd President.

The "Land –Of-The-Free"?  Who are you trying to fool?

By Andrew Butter

Andrew Butter is managing partner of ABMC, an investment advisory firm, based in Dubai ( ), that he setup in 1999, and is has been involved advising on large scale real estate investments, mainly in Dubai.

© 2009 Copyright Andrew Butter- All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

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