Why American health care costs are high

The video above is by John Green of the YouTube Channel vlogbrothers (the “Hank” he refers to is his brother and fellow vlogger on the Channel). It does a pretty good job of explaining why healthcare costs in the US are so high, and so much lower in other countries. It’s the first of a series of such videos, and part two, a capitalist argument for reform, is at the bottom of this post.

John mentions in passing the low cost of a particular drug in New Zealand, and he’s absolutely correct: The reason for that is the fact we have a central drug-buying agency (Pharmac) that negotiates with drug companies on behalf of the entire country. They have a set budget each year, and allocate the money based on the drugs most needed. This usually means that our prescriptions are massively cheaper than in the US—a bit like through some managed healthcare plans in the USA.

Because Pharmac makes prescription drugs affordable, it’s a non-negotiable thing for ordinary Kiwis. And yet, it’s continued existence is under threat from the Trans Pacific Partnership Agreement (TPPA) currently being negotiated in total secrecy. The current National/Act Government is determined to conclude a deal, but the question is, are they really prepared to cease to exist, and never form government again, if they agree to kill off Pharmac just to please the Americans?

Different countries have different solutions for healthcare, but the thing is, the USA’s is indisputably too expensive and inefficient. The USA can’t pick one country to copy, but there’s no reason it can’t pick and choose the most appropriate solutions from various countries. Something’s got to change.

Meanwhile, we’ll enjoy our cheap prescriptions, leaving the hospital without a bill and resting easy in the knowledge that no Kiwi will go bankrupt because they got sick or had a serious accident. As it should be.