Many expats in the U.S. coming from countries with single payer health care systems have reservations about "the American Medical Industrial Complex".
In this New York Times article, the interesting piece of information is that Americans - either through Medicare or insurance or personally - pay up to six times as much for their diabetes medication as Europeans do.
Ever increasing Medicare drug costs are a constant source of worry for the sustainability of the Medicare system and the rules are often tweaked as illustrated by this editorial.
But there has been political emphasis on not putting price pressure on the pharmaceutical industry because they poured much of their profits into Research & Development and thus discovered new drugs that could be exported. Profit to the American companies would assure more taxes coming in.
The same newspaper recently had a more amusing article on inversion. That is the process of moving a corporation to another tax jurisdiction ever more frequently employed by U.S. corporations.
The connection between these diabetes and the inversion articles raises to me an interesting prospect: If almost all major American medical companies through mergers remove themselves from American taxation, "tweaking" the rules may give way to more radical change.
If all pharmaceutical companies become foreign and the profits from export all stay abroad, how long will it will take for the government to want to renegotiate what Medicare pays? One would assume that prices for diabetes medication could be reduced at least 75% if Americans now pay up to 6 times as much as Europeans do.
The interesting thing about unspoken social contracts is that if one party changes its behavior, the other party may be inclined to do likewise. Employees used to be earning living wages and having benefits before they became Human Resources or Individual Contractors to be discarded at a whim - and "surprisingly" employee loyalty went down the drain with only around 30% of the work force feeling engaged in their work.
The pharmaceutical industry is testing another social contract. Who knows where that can take us?