Essay on Public Vs Private Healthcare

Introduction

It must be taken into account that the healthcare system is more corporate than ever before, and is capitalist. The relationship between IPE and biomedicine lacks socio-political context, as health is distributed very unequally. With this in mind posing the question should healthcare be publicly or privately funded? Specifically, looking at the Pharmaceutical industry and the ownership of intellectual property there is a relationship that can be explored between innovators and the industry, understanding this relationship lets the broad question be answered. Through the conceptualization of countries health care systems such as India where the majority of the system is privatized, and Switzerland which has arguably the best public healthcare of a country.

Furthermore, healthcare being such a broad term used to describe any aspect of health globally, needs to be narrowed down to a specific sector, as the question should be able to be answered in many sectors. Understanding the answer to this broad question relates to the conditions of health and could be rather beneficial in producing incremental changes to the Healthcare system globally to increase its inclusivity. Understanding the impacts ensures that good health meets two basic conditions including living conditions that do not induce disease, and that one should have access to quality healthcare. Achieving these needs embodies a link between good health labour productivity, and income generation. These conditions may not be met, leading to sickness which is proven to hinder performance in the labor process. If sickness is widespread that productive capacity is severely damaged.

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Big Pharmaceuticals in North America

Understanding the inner workings of large Pharmaceutical companies allows us to explore the auditing involved in the very money-driven market. The pharmaceutical industry, which is responsible for the development, manufacturing, and marketing of drugs for use as medications; is different in distinction than “Big Pharma”, the informal term used to describe faceless corporations that push hugely overpriced drugs onto desperate consumers.1 A large brand that most would be familiar with is Johnson and Johnson which have a 276B dollar market in this industry1. What do these deep pockets essentially mean? It allows these companies to spend an absurd amount of their budget on advertising and brand exposure. The company behind Cialis spent $272 million on promotion alone2. This seems ridiculous to promote certain medications with so much advertising however the economic gain for these corporations by doing so is increased, for every dollar spent on advertising should theoretically yield 4 times the profit in retail sales.1

Advertising is just a large portion of the competitive nature of this industry, and the pharmaceutical industry is behind some of the biggest mergers and acquisitions in history. Pfizer purchased Warner-Lambert for $87.3 billion in 1993 and went on to produce $125 billion worth of sales in almost 15 years.3 The massive amounts of money being circulated through the pharmaceutical industry leave a lot to be said for the potential political and legislative influence that could be brought onto the industry. Lobbying expenses and campaign contributions are documented from the Pharmaceutical industry, spending around $15 billion in campaign contributions between 2013-20141. Even though there are large fines legally set by the federal government to keep the industry from dealing in shady business, the industry itself is a significant contributor to the Food and Drug Administration’s budget, leading to concerns of conflicts of interest and bribery1. Acting as a medical mafia in a sense around 70% of Americans are on some form of prescribed/ unprescribed medication4. Many of these consumers are unable to afford much of the medication they need due to the upregulation of the prices in the pharmaceutical industry because of the informal hold of Big Pharma.

Consumers are exactly what the industry thinks of people, and continue to unfairly overcharge for their brand name drugs and faze the generic drugs out, harming scientists and innovators who’ve dedicated lifetimes in research and the preparation of these drugs for a profit. The battle between brand-name drugs and generic brands is the same as Big Pharma overtaking the innovators in this industry driven by profit-seeking behaviors. the difference is not about the composition or quality of the brand-name and generic drugs, but how they are regulated and priced. Brand-name drugs are more expensive than generics, even though similar effects on patients. In theory, doctors should be recommending generic drugs to their patients as an ethical duty to the responsibility of ensuring all have good health, and an aspect of good health is financial stability. However, the companies that produce generic drugs often do not have the financial influence and spending power of the bigger pharmaceutical companies that produce brand-name drugs.1 The FDA states that nearly 80 percent of prescriptions filled in the US are for generic drugs4 yet the influence that Big Pharma has on doctors is much too great for this statistic to hold. The Journal of the American Medical Association noted that many doctors acquiesce to their patients’ demands.5 Researchers writing in the Journal of Medical Care note that patients who request a specific medication during their doctors’ appointments have the effect of “dramatically” increasing how often their physicians prescribe that particular medication.5 Overall, the Pharmaceutical industry paints a very negative picture of the intellectual property rights of drugs and the influence that profit has on the monopoly that the industry can hold. Almost as if privatization has allowed the industry to have regulators and the government in their back pocket.

Industry in India and Sweden

To answer the research question evidence from healthcare systems that have public and private practices needs to be examined. It is not enough to use evidence supporting the notion that more privatization leads to more corruption by just looking at Pharmaceutical companies in North America. By understanding the factors that contribute to the inner workings of the system, an answer to the research question can be reached with more analysis of these systems.

India

India has a high prevalence of private care facilities and procedures, which means that privatization is a large component of their economy. Out-of-pocket health spending was 69.1% of total GDP expenditures in 2013-20146. There are many bottlenecks in the access of public health services in India which lead households to turn to private care. Public care in India is extended to maternity, newborn as well as infant care, and disease programs6. Furthermore, failure to upgrade public healthcare facilities has caused a shortage of staff and different medications in public care centers, this means that more people in India turn to the private sector as the care in the public center sometimes won’t even meet patient demands. Over 63 million Indians cannot afford private health care6. It seems difficult to understand the positives to India’s healthcare system as public funding seems minimal compared to private. The public sector is focused more on community health and uses sub-centers to connect primary, secondary, and tertiary care facilities. The hospitals operate within a budget that is allocated differently yearly. The framework the government has set out seems credible however there are severe shortages in all aspects. India decided to focus more on public care for rural communities through the creation of those sub-centers, which leaves poor urban households extremely vulnerable to lack of access to healthcare6. The yearly budget allocation only allows the government to do so much before the private sector comes in to make money. India’s private sector lacks regulation in all aspects due to the lack of public care in major cities.

This is ironically India’s own doing as the government has relied heavily on public-private partnerships in their private hospitals. Allowing for more resources to be created for yearly use. These partnerships funded 70 percent of new hospital beds to both sectors, as well as provided 80% of outpatient care and 60% of inpatient care6. Moreover, doctors are much more likely to get a job in the healthcare industry in the private sector as the wages are much higher than with a governmental position6. Outpatient care is administrated outside of a hospital setting meaning a clinic, so if 80% of that care is offered through private companies, the problems 63 million Indians face will just continue without regulation, privatization seems to be a variable sum game where the private sector seems to be getting the best deal when privatization is being favored in a system.

Sweden

Contrasting India’s healthcare system which is dominated by privatization, this paper will now analyze Sweden’s healthcare system which is known to be one of the world’s best in terms of a country's quality of healthcare. The Swedish government is heavily involved in healthcare at all levels. It also abides by three basic principles on Human dignity, Need and solidarity, and Cost-effectiveness7. Around 83% of health expenditure GDP funding was from the public, county councils and municipalities in Sweden impose proportional income taxes on their communities to cover most of the health care expenditures7. As well there are finance-specific enterprises that are granted to the system when mandates or goals are met such as a reduction in wait time7. In Sweden coverage is universal, undocumented migrants are eligible to receive care and have the right to not be differed. Private care in Sweden accounts for less than 1% of GDP expenditures in health in the form of supplementary coverage. It can be purchased in Sweden however is only really used through occupational therapy to reduce wait times for rehabilitating individuals8. There is still competition in Sweden, although it seems the majority of the healthcare system is public, there is competition among both public and private providers for patients7. The Public sector regulates the private sector not through pricing competitions but by regulating organizational aspects of the business and financial payment of those employed7. This would act as an incentive for professionals to work in the public sector as they aren’t subject to these imposed regulations.

Conclusion

To reiterate the goal of this paper was to answer the question of should healthcare be publicly or privately funded. With the evidence provided above it's possible to deduce that a more publically funded healthcare system is beneficial for more people in society as a whole. Evidence from pharmaceutical companies’ monopoly on drug brand naming, lobbying, and advertising almost paints a greedy picture of the government which seems to fall for any bribe that means more money for them. Also, evidence from a comparison made between two drastically different healthcare systems allows for a coherent analysis where India is dominated by privatization leaving 63 million of its population in sickness, while Sweden has done an exemplary job of suppressing the private sector in the best interest of the public in an intelligent way where they can still be competitive slightly in the market.

References:

1.  Who Are the Players in the Pharmaceutical Industry (Big Pharma)?' Desert Hope. Accessed March 23, 2019. https://deserthopetreatment.com/big-pharma/
2. Williams, Sean. '7 Facts You Probably Don't Know About Big Pharma.' The Motley Fool. July 19, 2015. Accessed March 23, 2019. https://www.fool.com/investing/value/2015/07/19/7-facts-you-probably-dont-know-about-big-pharma.aspx
3. Associated Press. 'Lipitor Becomes World's Top-selling Drug.' Crain's New York Business. December 28, 2011. Accessed March 23, 2019. https://www.crainsnewyork.com/article/20111228/HEALTH_CARE/111229902/lipitor-becomes-world-s-top-selling-drug
4. CBS News. 'Study Shows 70 Percent of Americans Take Prescription Drugs.' CBS News. June 20, 2013. Accessed March 23, 2019. https://www.cbsnews.com/news/study-shows-70-percent-of-americans-take-prescription-drugs/
5. Campbell, Eric G., Genevieve Pham-Kanter, Christine Vogeli, and Lisa I. Iezzoni. 'Physician Acquiescence to Patient Demands for Brand-name Drugs: Results of a National Survey of Physicians.' JAMA Internal Medicine. February 11, 2013. Accessed March 23, 2019. https://www.ncbi.nlm.nih.gov/pubmed/23303297
6. International Health Care System Profiles.' India: International Health Care System Profiles. Accessed March 23, 2019. https://international.commonwealthfund.org/countries/india/.
7. International Health Care System Profiles.' Sweden: International Health Care System Profiles. Accessed March 23, 2019. https://international.commonwealthfund.org/countries/sweden/.