David R. Henderson  

Socialized Medicine Can Kill

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A 29-year-old woman will die without a new drug that the NHS is refusing to provide despite the manufacturer offering it to her for free, it emerged today.

Caroline Cassin, 29, who suffers from Cystic Fibrosis (CF) has been offered a new drug free of charge for a limited period by the makers but her NHS hospital is refusing.

Her family say she will die soon without it, yet managers at Heartlands Hospital in Birmingham say it would be unethical to provide the drug under the deal, only for it to be withdrawn later.

The drug, Kalydeco also known as ivacaftor, costs £182,000 per patient per year, and works for five per cent of people with CF who have a certain defective gene, around 270 people in England.


From "Cystic Fibrosis sufferer denied 'chance of life' drug by NHS," The Telegraph, Monday, October 29, 2012.

This is the kind of thing that can happen when the government gets the power to decide on our medical care.

One thing that the article doesn't make clear, though, is why she needs the National Health Service's cooperation at all. Can anyone explain?


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COMMENTS (36 to date)
mick writes:

Because it is illegal to get health care without the approval of the NHS. It is exactly the same with the Independent Advisory Board. It will soon be illegal to get health care without their permission.

RPLong writes:

I believe it has something to do with the physicians who will have to administer the drug. Actual NHS hospital physicians have to administer the drugs and technologies, and if they're not officially sanctioned/funded by the regulatory agency, NHS, NICE, or whoever else, then there are two issues at play: (1) Legal liability, and (2) Having sufficient training/expertise in the particular drug. So even if the drug is provided free of charge, if the treatment occurs in an NHS hospital, then an NHS physician will have to do the work. If the NHS panels say "No," then it's unlikely the physician will undertake the risk/responsibility of administering an unsanctioned medication.

This is speculation on my part, but informed speculation based on conversations I had with industry professionals when I worked as a pharma consultant in Canada. Take it for what it's worth.

Ken B writes:

I cannot speak for the UK but in Ontario it would be privatized medicine which is strictly limited. You cannot even give free medical care in Ontario for huge classes of care. The manufacturer would be reluctant to describe the use as non-medicinal for legal reasons.

On the bright side in Ontario recent changes mean pharmacists can now renew all prescriptions except narcotics for 6 months and nurse practitioners can now prescribe nearly all medicines.

tim writes:
This is the kind of thing that can happen when the government gets the power to decide on our medical care.

The cost of this drug is out of the reach of the vast majority of individuals - so unless she is vastly rich - she won't be getting it anyways. And its doubtful any insurance would cover it unless mandated by government.

This issue is complex and can't be boiled down to using headlines meant to provoke fear.

John Thacker writes:

@tim:

In many cases, yes. But not in this particular case, where it is being offered for free, as noted.

So are you saying that she must be sacrificed for the general principle of fairness?

zgatt writes:

I suspect the issue is the family has to either get the NHS to approve the drug as treatment (for an NHS physician), or pay out of pocket to an independent physician to take over the case. That might be a fairly extensive and costly process, performing diagnostic exams and tests, and following through the course of treatment. The drug company is not volunteering that expense.

Graham Asher writes:

"Because it is illegal to get health care without the approval of the NHS."

No, that is not true. Some things are bad here in the UK, and some things are weird, but it hasn't reached that level yet. It is legal for you to get whatever health care you like if you pay for it yourself.

Brad Warbiany writes:

Following up on Greg's update above, I think it's overly generous to say that the hospital reversed it's position based on his link.

The pharma company is no longer saying the offer of the drug for free is time-limited. So because NHS now believes they'll never have to pay for the treatment, they're willing to let this woman live.

How nice of them.

Tim Worstall writes:

"Can anyone explain?"

Yes.

There are two things going on here.

1) Until very recently if you got treatment that the NHS did not cover then you lost your entire right to NHS treatment. Get an anti-cancer drug, just as an example, that all NHS patients did not get and you lost all anti-cancer treatment from the NHS. So suddenly getting that extra drug, for free maybe, became very expensive indeed. Your, say, mammograms, general treatment, hospital bed, all became payable.

Thankfully that has now stopped.

2) The politics of this. I'm sorry, I'm about to be very harsh indeed. This particular CF sufferer is an attractive young blonde. The drug company is offering, for some unknown period of time, free drugs. Drugs which cost, normally, £185,000 a year, if I recall the article correctly.

The NHS normally only pays for drugs/treatment if they offer a quality adjusted life year (QUALY) at £30,000 or less. Limited resources, spend them the best way, all that.

What the NHS is actually worried about here is 1 years on the free drugs. They work. Then it becomes, well, why will you not pay for them? At which point, attractive young woman will die as a result of the NHS not paying £185,000 a year.

This is harsh, harsh, I know. But the NHS might well be right in claiming limited resources and perhaps such should be directed elsewhere?

david writes:

Mr. Henderson, the UK is not Canada and the private provision of healthcare there is entirely legal; it is however difficult to acquire the subsidies for it that are applied to NHS-run institutions, due to subsidies on staff and so forth.

Nonetheless at no point does the NHS have the authority to deny care that the patient is willing to pay the full costs for; that power is reserved to the UK's equivalent of the FDA, the MHRA. We could protest the MHRA on the same grounds as the FDA, but it is not socialized healthcare.

I hope you amend at least the title of your post to reflect this.

Motoko writes:

david,

It's "Dr." Henderson.

If we're going to nitpick...

david writes:

Huh. Perhaps 'Prof.'?

Ted Levy writes:

David,

To play Devil's Advocate, why is your title "Socialized Medicine Can Kill," and not, say, "The Facts of Scarcity Can Kill?" After all, the company is not going to ALWAYS offer ALL CF patients drugs costing £185K/yr for FREE. Most people can't pay that amount. This is true under any system. And it is presumably good that it is so, since this price suggests there are more value-productive uses for the scarce resources devoted to making this drug that could be put to better use.

So why do you say Socialized Medicine is killing her?

David R. Henderson writes:

@Ted Levy,
To play Devil's Advocate, why is your title "Socialized Medicine Can Kill," and not, say, "The Facts of Scarcity Can Kill?"
Because the discussion is about a decision by the National Health Service, which is an example of socialized medicine. The NHS refused to cooperate even though its cost for this drug would have been zero.

Ted Levy writes:

Yes, but every social system has some decision mechanism. In England's socialized system, it's the NHS. My point is, to expand, isn't it true your headline might have been:

"Socialized Medicine Can Kill in England Much As Lack of Funds Can Kill in America,"

but could not have been

"Socialized Medicine Can Kill in England Whereas Similar Patients Would Be Saved In America"?

david writes:
The NHS refused to cooperate even though its cost for this drug would have been zero.

Well, no: it would still need to pay doctors, nurses, staff, and rent.

Of course the patient could always opt to walk out to a private hospital and pay for all that herself, and then the marginal cost for the drug would certainly be zero, and at no point would the NHS stop her. But the state's subsidies come with conditions.

David R. Henderson writes:

@Ted Levy,
My point is, to expand, isn't it true your headline might have been:

"Socialized Medicine Can Kill in England Much As Lack of Funds Can Kill in America,"
but could not have been
"Socialized Medicine Can Kill in England Whereas Similar Patients Would Be Saved In America"?

I don't think so. I think a patient in the United States who was similarly situated--that is, having a generous pharmaceutical company willing to pay--would have found her insurance company willing to cooperate. So, if I'm right, the difference is socialized medicine.

Costard writes:

If denial of care is the same thing as killing a person, then denial of food is the same thing as starving them. In which case you're providing a moral (or at least a causal) justification for theft and the violation of private property. The truth is that no system is free from situations that look bad in isolation, and while anecdotes might tell us something about the nature of the NHS - it is bureaucratic, clearly - they're not sufficient to judge it.

But you could argue that a system that restricts alternatives, ie a heavily regulated or monopolized one, is as likely to prevent good outliers - acts of charity - as it is to prevent bad ones - people unable to receive basic care. In which case we've succeeded mainly in reducing society to a business arrangement, and giving individuals no great reason to like or respect one another. A mutually-beneficial arrangement becomes an adversarial one.

Methinks writes:

I'm absolutely astonished at the number of people who fail to understand the difference between a bureaucrat arbitrarily denying access to available supply and a person simply lacking funds.

A lack of funds is not a condition that is impossible to overcome. There's charity, a second job, the sale of an asset, etc. A bureaucrat simply preventing you from obtaining life-giving medicine at ANY price is inhuman cruelty.

Oh, what lengths some are willing to go to in order to defend their romantic attachment to cruel self-righteous meddling. No price is too high for others to pay.

And that's even without touching on the question of the right and morality of a smug government bureaucracy to interfere in what is by all rights a private transaction. Those who have touched on that here have most often explained how the NHS bureaucracy operates as if such a monstrosity is in any way natural in the first place.

Disgraceful. We're too feeble to question our serfdom anymore, possums.

Methinks writes:

Well, no: it would still need to pay doctors, nurses, staff, and rent.

Right, dear. That's what those steep taxes and lower standard of living are meant to pay for whenever you find yourself in need of medical services. Or were you under the impression that the NHS was sold to the British public as a vehicle for the care and feeding of useless bureaucrats at the expense of taxpayers and the ailing public?

And please, please! Don't say that scarcity is not eliminated by a socialized medical system. Everyone should know that, but it is, in fact, what is in every one of those marketing brochures. At the very least, the people expect to get more than before. Not only do they get less, but they are then prevented from getting anything even under their own steam and by their own efforts.

The condition is: taxpayers pay an arm and a leg for universal care and they get it when needed. The bill of goods that was sold to the Brits wasn't "you'll take what we give you and you'll like it". It's become that. Like every socialized system. Always.

Now, we have your weak argument that it's just too expensive for the NHS to perform the cheap task of administering a drug offered free of charge? Seriously?

Methinks writes:

If denial of care is the same thing as killing a person, then denial of food is the same thing as starving them.

If I don't give you food, I'm not starving you. If I prevent someone else giving you food, if I prevent you from obtaining food, then I am starving you. See the difference?

The Brits are first robbed at gunpoint to pay for the NHS. When they need care, they are at the mercy of the NHS. When the NHS prevents someone else from providing that which it won't, then it is killing them.

Carrie writes:

The reason she requires NHS cooperation has to do with the way drugs are "approved" and made avaiable in Europe. In the US, companies often begin pricing discussions with private payers before a drug is approved. Once the FDA green-lights the drug, they can start shipping to pharmacies. If pricing negotiations are extended, you may end up paying out of pocket at the price the company sets (or paying the delta between that price and what your insurer eventually agrees to pay), but you can generally have access to the drug on day 1. In Europe, the process is different... only after the EMEA gives marketing approval can companies begin negotiating with member states on pricing. Also, they are not allowed to attempt to sell the drug until the pricing negotiations are complete (which gets ridiculous in situations where member states have no intention of covering a drug but drag out negotiations for months just to say "sell it for whatever you want because we're not paying"). So it's generally 6-12 months after marketing approval before a drug is available to the first country in Europe. Kalydeco was just approved by the EMEA in July, so currently they're not allowed to sell the drug into the UK (even if they "sell" it for free). A compassionate use program is the only way to give patients access to drugs in this intermediates period (a similar program exists in the US for drugs that have submitted new drug applications but have not yet been approved), but these programs generally require a significant amount of monitoring and paperwork so are often not feasible to be administered by private physicians (they may not be allowed to administer compassionate use programs in the UK- I'm not sure of the specific rules there).

I am an investor in this company (full disclosure, although I own very little stock now), so I thought some of you might appreciate a bit of the background. The very early research on this drug was funded by the Cystic Fibrosis foundation, and they actually receive a royalty on sales (really innovative program IMO). After that initial research, the company had a difficult decision to make- very little data was available about the drug's efficacy, VERY expensive trials would be required to have a shot at getting it approved (in the hundreds of millions of dollars), and very few patients would be eligible for treatment (it works for less than 10% of CF patients who have a specific gene mutation- we estimated only 1,000 patients in total in the US). You can probably do the math on that and have an idea why the pricing looks the way it does.

I'm a cynical drug investor, but I will tell you this is the first drug approval I was genuinely proud to be a part of. The company did some truly ground-breaking work (which has lead to other drug candidates that have the potential to work in a broader patient population), and this drug - in my humble opinion - meaningfully changes people's lives (many of the patients in the trials no long met the clinical definition of CF after being in the drug... we don't often use this word in drug development, but it essentially has the effects of curing patients).

If the company is "using" a patient to publicize the efficacy of this drug, I really can't fault them for that (although I will tell you that few biotech companies have the commercial savvy to try a strategy that bold!).

John Smith writes:

I strongly agree with all the detractors of David Henderson. Henderson does not seem to be up to his usual standards, perhaps because this is socialised medicine (which I hate too).

The NHS is by all accounts not stopping the patient from having the treatment given at her own cost. It is simply not willing to foot the cost of applying the treatment even with the drug being provided free. It is by no means killing her, but simply refusing to save her. A grave distinction.

As for its refusal, the NHS probably suspects with good reason, that the drug company will withdraw its free offer after a few years and hope that the politics of it will force the NHS into thereafter paying for the drugs. Since the family and media willd argue that it is not fair for the NHS to allow her to die merely because the drug company is now requiring payment. People are bastards.

egd writes:

This isn't unique to "socialized medicine," at least as the term is understood. The FDA regularly restricts access to life-saving drugs in the U.S. "free market health care."

The problem isn't socialized medicine but drug regulation.

"My body, my choice" and all that.

Matt writes:

Are we leaving the cynical free market approach out of this? As a Brit, I know that my NHS care will generally be of worse quality than that available in the private market EXCEPT when it comes to major, life threatening diseases or pre-existing conditions, where the service excels relative to private competition (for obvious reasons of monopoly development).

However, there is a trade off for this increased standard of care; that of 'handing over' decisions like this to the NHS. The lady in question made the decision, ex ante, that this was her best option. If she had instead chosen a private insurer then her outcomes may have been different, but she didn't. She signed up for socialised treatment, why? Because it was by far the most cost effective means of dealing with such an expensive pre-existing condition.

For the vast majority of British people this is true, even if they don't have pre-existing conditions, and given the tax structure in the UK it is hard to argue that those who want to go private are prevented from doing so by burdensome NHS-funding taxation.

I presume there are many targets one can pick to rail against socialised medecine, but the NHS is on average a well run and, by British standards, well approved institution. As Mitt Romeny found over the summer, just because the Brits grumble about something doesn't mean they aren't fiercely proud of it.

Methinks writes:

If she had instead chosen a private insurer then her outcomes may have been different, but she didn't. She signed up for socialised treatment, why? Because it was by far the most cost effective means of dealing with such an expensive pre-existing condition.

Ridiculous.

Did she have the option to not pay for NHS? No? Then she has already paid for health services that are now being withheld.

Your complaint is that she didn't pay for an empty promise of health services and then, having been made poorer for being forced to pay for the NHS, didn't pay again for privately provided care.

If she and her family had the option to refrain from paying into the NHS, your argument might hold water. And don't be fooled into thinking that if she didn't write a check, that there is no cost to her for funding the NHS.

the NHS is on average a well run and, by British standards

That's the key, isn't it? You have to lower the standards enough so that failure begins to resemble success.

Maximum Liberty writes:

The NHS killed a friend of my parents-in-law last week. They mis-installed a medical device. He went to the emergency room with symptoms that told the doctor what the problem was. The doctor scheduled the corrective action for as soon as possible -- about five days away. He was dead in two. In the US, he would not have left the hospital without the correction; he would have been in the operating room same day.

I've left out the details for the sake of their privacy. But it isn't complicated stuff, nor is it experimental; this device has been around since the 70's or 80's. Thousands and thousands of Americans have this device. Waiting in line for free care kills people who wait.

Max

Costard writes:

Methinks: "If I prevent someone else giving you food, if I prevent you from obtaining food, then I am starving you."

Laws prohibiting theft prevent me from obtaining food. So is the state starving me? The public? Private property? You say that the bureaucracy is unjust. I might reply that free markets are unfair. These sorts of arguments are gifts that keep on giving: always satisfying, never convincing.

The virtue of the free market (and liberty in the whole) is not its morality, but its lack of one. The NHS and other nationalized systems make decisions that are by nature moral. They decide at which point a life ceases to have worth, they dictate the role of healthcare and they enumerate the responsibilities of the individual towards their own bodies. As economic institutions they impede innovation, and as moral enfranchisements they enforce a kind of ignorance, by rendering all philosophical and ideological discussion moot. What we've been given is a War on Death; an implacable crusade against something that is a part of life, unavoidable yet unknown, and which can only be defined and made sense of at an individual level.

But this is a very different criticism than saying, "the NHS is bad because it kills people." In that case you have already made an assumption about the role and responsibility of healthcare with regards to other people -- an assumption that you have no more right to make than the NHS does.

Ted Levy writes:

I think Maximum Liberty's anecdote above works better than the one Professor Henderson began this thread with.

Getting back to my disagreement with David, I guess the point is simply that I see, as a physician, patients of the sort David views as dead because of an NHS decision all the time, dead because of a decision made by an insurance company.

This often leads to the insurance company being painted as heartless, which I believe is unfair. None of us work to LOSE money, and you can ALWAYS spend more on healthcare. The insurance companies don't have a moral responsibility to save your life; they have a moral responsibility to meet their contractual obligations.

The problem *I* have with the NHS is that, as a monopoly, it takes away from me the choices in making life-and-death decisions, NOT that the decision isn't always made to save my life INDEPENDENT of the cost.

Joe Cushing writes:

If it costs £182,000 for the drug, surely for a sum far less than that, she could be moved to a place were the rulers don't decide for her.

Methinks writes:

Laws prohibiting theft prevent me from obtaining food. So is the state starving me?

Obviously, there is no other way to obtain food save theft. What a conspicuous oversight on my part!

But this is a very different criticism than saying, "the NHS is bad because it kills people."

Of course it's different. And it's also tortured and irrelevant.

This isn't a question of how the NHS allocates scarce resources vs. how the market gets the job done. You're completely wrong about the nature of the decisions it makes, but I won't go into it now as it's tangential.

In this case, the market - just or unjust, fair or unfair - IS providing. The only role the NHS is playing is one of preventing someone from obtaining without any violations of property rights a legal, lifesaving product. That is its ONLY role in this absurd little drama.

If I prevented your child from swallowing a life-saving pill that someone is trying to give him, I'm pretty sure you'd understand very quickly that I'm killing your kid.

[yeah, yeah...none of us escape death in the end]

Methinks writes:

I see, as a physician, patients of the sort David views as dead because of an NHS decision all the time, dead because of a decision made by an insurance company.

I thought you were in the socialist paradise of Canada, Tom. Aren't you lot prohibited from having private insurance?

Anyway, I had no idea that private insurance companies have the ability to prohibit pharmaceutical companies from donating a drug insurance won't pay for. I've never heard of such a thing. Perhaps you can provide some examples since you see this "all the time".

I also had no idea that private health insurance companies prevent people from paying for any medical care out of pocket. I have private insurance, but I pay out of pocket for all of my doctors and most of my medical procedures and I've never once heard the slightest objection from my insurance provider.

Unless they're doing those two things, there's no way a reasonable person can claim insurance company decisions are killing anyone.

Because you must understand by now that the issue isn't that the NHS won't cover the cost of the drug and the woman is not unable to obtain the drug on her own, it's that the HHS is arbitrarily forbidding her taking a drug the NHS isn't going to be paying for.

Greg writes:

@Methinks: No, there's no prohibition on private health insurance. In fact, most employers offer some as a benefit; it pays for things that the public program does not, like eye exams in Ontario.

The truth is more complex and is an artifact of the separation of powers. The federal government funds health care, but provision of health care is a provincial responsibility.

Briefly, (among other things) the Canada Health Act says the provinces get money from the Feds to provide people with health care from hospitals & medical practitioners. If people are charged for those services, the Feds have the right to reduce the amount of money transferred to the province by the amount charged.

What follows is that it is not in the provincial interest to have duplication of Fed-funded services by non-public providers, so they try to prevent it. Cue arguments about whether for-profit provision is fair and whether it reduces or improves waiting times for public patients.

Methinks writes:

Thanks, Greg. I knew some of that, but you have enlightened me.


The prohibition on paying privately has the effect of limiting supply when demand exceeds what the public system can manage. Thus, my aunt waited 4 excruciating months for a simple surgery to remove a devastatingly painful kidney stone (a procedure that would have been done within 48 hours of presenting with symptoms in the United States) and my uncle has been waiting for 6 years to see a specialist about a nerve condition that is preventing him walking normally. Famous hockey players and politicians move directly to the front of the line.

What could be more fair or egalitarian that that?

Greg writes:

@Methinks: It limits supply in all conditions, not just high-demand ones. High demand conditions just expose it.

And you're absolutely right: people want something and can't get it, even if they *want* to pay for it. Though if they traveled to the US (or any of a number of medical destinations) they could.

The other side of the coin is: when they did get it, it was free or low-cost, and didn't substantially depend on their employment benefits or private coverage. That's fair, though not in every sense, and maybe not in the sense that you care about (this is EconLog, after all).

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