re: EBC Book #2 - Applied Economics by Thomas Sowell

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For me, his remarks merely affirm what the primary driving factor of medical costs in the US are - socializing the payments through private insurers who pass the cost along to consumers. The dominant "solution" seems to shift the concept of "single payer" (which should be the consumer) to the one that writes the checks, paid by compulsory payments and price fixing without regard to the effects on supply.

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I couldn't agree more here. I often struggle with the morality part of healthcare like he describes in his tv anecdotes like the "crying grandmother" or "hospitalized child", but Sowell's ability to take the moral issue out of the equation makes the reality of the economics so clear.

Another piece I found interesting that I have some personal experience with is incentives and regulation of drug discovery, manufacturing, regulatory clearance, and pricing. Obviously a very complex issue. One of the companies I used to work for primarily invested in pharma drugs, some of which were going through Stage 1/2 of drug development (smaller sample sizes, proof of concept essentially). We invested between $2-$5M that we thought had life changing consequences including one drug whose results eradicated Stage 4 cancer in 70% of trial patients and had people out of the hospital that were given 3 months to live. Since this was stage 1, the purpose of the trial was to test for side effects of the drug since it was a drug taken in conjunction with chemo. Obviously the team was excited, filed to go public, and raised a ton of money for Stage 2 which is to test the efficacy on a larger sample size.

The problem here is exactly as Sowell describes when it comes to the cost/benefit of lives that aren't saved by testing drugs that potentially could save a life vs going through the full FDA process which could take years to finish. Currently, the Stage 2 trial is way over subscribed, so the company it being extremely selective in who will test for efficacy. So we let people invest their cash in companies who potentially have a life saving drug since the company has IPO'd, but we won't let them invest their most valuable asset (life) in that same company due to regulatory restrictions? I understand why the company doesn't include everyone as they want to maximize their chances for a positive result and not skew sample based on race, gender, etc, but is there not a better way to allow consumers to make this decision themselves that wouldn't skew the results of the company's study?