Virginia Postrel describes her drug problem — or what could have been a drug problem somewhere else:
If I lived in New Zealand, I’d be dead.That’s the lead my editor wanted me to write, and I have to admit it’s great. Alas (for this column, at least), it’s not exactly true. But neither is it false. And the ways in which it’s partly true matter greatly, not just to me or to New Zealanders but to anyone who might get cancer or care about someone who does.
When Postrel found out she had cancer, it didn’t look bad. Then it did. The drug Herceptin took her chance of survival from 50 percent to 95 percent, and things currently look good:
The Herceptin treatments cost my insurer about $60,000. A year later, I have no evidence of disease and, though it’s still early, I have hope of staying that way indefinitely.Not everyone in similarly rich countries is so lucky — something to remember the next time you hear a call to “tame runaway medical spending.” Consider New Zealand. There, a government agency called Pharmac evaluates the efficacy of new drugs, decides which drugs are cost-effective, and negotiates the prices to be paid by the national health-care system. These functions are separate in most countries, but thanks to this integrated approach, Pharmac has indeed tamed the national drug budget. New Zealand spent $303 per capita on drugs in 2006, compared with $843 in the United States. Unfortunately for patients, Pharmac gets those impressive results by saying no to new treatments. New Zealand “is a good tourist destination, but options for cancer treatment are not so attractive there right now,” Richard Isaacs, an oncologist in Palmerston North, on New Zealand’s North Island, told me in October.
A more centralized U.S. health-care system might reap some one-time administrative savings, but over the long term, cutting costs requires the kinds of controls that make Americans hate managed care. You have to deny patients some of the things they want, including cancer drugs that are promising but expensive. Policy wonks dream of objective technocrats (perhaps at the “independent institute to guide reviews and research on comparative effectiveness” proposed by Barack Obama) who will rationally “scrutinize new treatments for effectiveness,” as The New Republic’s Jonathan Cohn puts it. But neither science nor liberal democracy works quite so neatly.
In New Zealand, for example, Herceptin is a high-profile public issue. Until July 2007, Pharmac wouldn’t fund the drug for early-stage breast cancer. (It has covered the drug for the advanced disease since 2002.) In protest, activists filed lawsuits and sent petitions to Parliament. Pink-clad motorcycle riders circled the North Island in a “Bikers for Boobs” publicity stunt that got widespread attention. To pay for treatments, women who could do so have mortgaged their homes, dipped into their retirement savings, and held fund-raisers among their neighbors. Many have cut their treatments short to save money. “It’s not easy to sit down every three weeks and write a check out for four and a half thousand dollars,” says Chris Walsh, a breast-cancer activist who mortgaged her house to buy the drug, stopping after 15 doses rather than the usual 17.
Eventually, Pharmac decided that Herceptin was worth paying for — but only for nine weeks, or three treatments.
You can err on the side of patient safety, Postrel points out, or on the side of cost. New Zealand chose the latter:
Looking at the crazy-quilt American system, you might imagine that someone somewhere has figured out how to deliver the best possible health care to everyone, at no charge to patients and minimal cost to the insurer or the public treasury. But nobody has. In a public system, trade-offs don’t go away; if anything, they get harder.The good thing about a decentralized, largely private system like ours is that health care constantly gets weighed against everything else in the economy. No single authority has to decide whether 15 percent or 20 percent or 25 percent is the “right” amount of GDP to spend on health care, just as no single authority has to decide how much to spend on food or clothing or entertainment. Different individuals and organizations can make different trade-offs. Centralized systems, by contrast, have one health budget. This treatment gets funded, and that one doesn’t.
If I lived in New Zealand, I wouldn’t be dead, just a lot poorer. But if every place were like New Zealand, far fewer complex new drugs would get developed in the first place. And my odds of survival would be much, much lower.