Everyone on a boat has twenty dollars and absolutely needs an EpiPen to live. You have a supply of EpiPens and want to get as much of their money as possible. There's zero elasticity between 0 and 20 dollars, but you better not charge $21!
Now, imagine that there was only one person who needed an EpiPen, but everyone else was willing to pitch in as much as it took to help them out. If the supplier of the medicine was perfectly evil, the price would be $20 times the number of people.
Perfect self-interest is a pretty good model of any industry, including pharma, so I think this is a good picture of the situation. The ACA was careful to keep something like a market system in place, which is why we're faced with a problem that can be understood with microeconomics.
I'm describing market actors with phrases like "perfectly evil," so I hope my comments aren't coming across as policy proposals. All I was arguing is that uninsured people running out of money was a pressure that used to be restraining the price increases but now isn't.
I really feel like this discussion is suffering from false-dichotomy-itis: I've actually been very careful to avoid saying anything beyond my point, about (say) whether or not single payer is a good idea for the US.
Everyone on a boat has twenty dollars and absolutely needs an EpiPen to live. You have a supply of EpiPens and want to get as much of their money as possible. There's zero elasticity between 0 and 20 dollars, but you better not charge $21!
Now, imagine that there was only one person who needed an EpiPen, but everyone else was willing to pitch in as much as it took to help them out. If the supplier of the medicine was perfectly evil, the price would be $20 times the number of people.
Perfect self-interest is a pretty good model of any industry, including pharma, so I think this is a good picture of the situation. The ACA was careful to keep something like a market system in place, which is why we're faced with a problem that can be understood with microeconomics.