The Spelling Bee Blues

Only two words to go
But then totally stymied
So feeling rather low
As aspirations go by me.
#ThereAreWordsInTheDictionaryThatAreNotAccepted

Geezer Self-Maintenance

What you oughta
Drinking watta
Though you might be keen
On having more caffeine.
#FrustrationViaDehydration

Irritable Lanny Syndrome

Yesterday, I went to the Digestive Health Institute at Carle for a breath test to see if I have SIBO, small intestinal bacterial overgrowth. The test is administered over time. I would blow into a tube connected to a collection device. The tech who administered the test would take the collection of my breath and feed it into some machine. The first time this was done, it was to establish a baseline. Then I was given a bit of sweet fluid to drink (Lactulose). There were subsequent readings every twenty minutes, for two hours in total. 

 

I was told they were very busy when I was there. Indeed, after the first reading and drinking the fluid, which happened in an examination room, I was then ushered back to the waiting room. All subsequent collections of my breath happened there in the waiting room. The technician came out to get it. I remained seated as she did this. 

 

There were several other people in the waiting room who were also having breath tests. The technician told me this was a scheduling issue. But it also must be that many people have similar symptoms to mine and the breath test is a first step at diagnosis, since it is comparatively inexpensive to administer and benign for the patient, except for the time commitment. 

 

At the conclusion of the test, I was told by the technician that it could be up to 2 weeks before I would get the results. In fact, It was only a few hours later when I got a message from the APRN who ordered the test. I had tested positive, not really a surprise given my symptoms. She recommended that I get a prescription of Xifaxan and she said she'd work with my insurance to get it approved. Apparently there is no generic version and only a couple of reasonable alternatives, one of which is currently in short supply. I wrote back to her saying it would be ironical if my insurance didn't give its approval, as I pay an IRMAA for Medicare Part D. 

 

The pharmacy called earlier this afternoon saying the prescription was ready. I went to the drive-through to pick it up. My bill was $713.63 for two weeks worth of pills (taken 3 times a day). I would have exploded at this, except that the night before I did a little research online about the cost of Xifaxan and thus knew it was well over $2,000. The invoice from the pharmacy confirmed this. The full price was $2,442.89. So I agreed to pay my share. And as of now, I've taken the first of the 42 pills.

I can afford this and after today probably won't lose any sleep about it. But what about the others who tested positive? I can only guess at the income of others who were sitting in the waiting room yesterday. Given that, I can imagine that some, in a similar situation, would say that $700 is too much to pay for the pills and therefore go without. How can that make sense, especially for retirees on Medicare?

 

Prescription drugs for more esoteric illness coupled with how health insurance now works has become a royal pain in the ass. 

 

We've known that for some time, but this is the first time in my own experience where that stared at me straight in the face, as I've only once before received medical attention in the waiting room and that time my situation was unique. This time, it applied to several other patients as well.

 

*****

 

Most readers can stop after reading the above. Below I want to discuss the underlying economics a little, and suggest a possibly better way for conducting government policy about drug pricing.

Fundamentally new drugs that offer the promise of improved health for many receive a patent, or possibly several different patents. The patent protection means the drug company faces no competition in the market for this drug during the patent term. The patent term is the greater of these two: (1) 20 years after the patent application has been filed, or (2) 17 years after the patent has been awarded. There will be competition from generic alternatives after the patent term has expired. That competition should bring down the price. 

 

During the patent term, there will be monopoly pricing. Of course, this price depends on the demand for the drug. Pharmaceutical companies try to increase demand by marketing their drugs to doctors. Doctors have incentive to recommend the best drug for treatment, regardless of cost. So the aforementioned marketing focuses on drug effectiveness. Of course, the doctors and other health professionals do understand the affordability issue for their patients. 

 

Patients who have their drug costs insured 100% don't care about the price at all. It's the insurance company that cares. Even when the patient has a co-pay or a deductible, the concern about drug price may be minimal as the insurance company bears the lion's share of the cost. Thus the system has evolved so the insurance company has to approve the prescription beforehand. If the insurance company doesn't approve, the patient can't get the drug unless the patient is willing to pay full price for it. This is the same mechanism at work with expensive diagnostic procedures. (A quick aside here, my experience recently, meaning over the past 5 years or so, is that doctors and other health professionals are intimidated by this approval process. They resent that their judgments are challenged by the insurance companies.)

 

With this as background as to what determines demand for a new drug, there will be monopoly pricing . The price of the drug will be set to maximize the profit of the pharmaceutical company. As any student of microeconomics should be able to tell you, the monopoly price is socially inefficient. There is a deadweight loss. (This is sometimes referred to as a Harberger triangle, after the U Chicago economist Arnold Harberger.) 

 

Social efficiency is obtained with marginal cost pricing. For this discussion the price of a generic alternative gives a reasonable approximation of marginal cost pricing. The proposal I will offer here is that this be the pricing that is used even near to when the drug is introduced in the market. The pharmaceutical company will be rewarded another way, by government paying it an amount equal to the monopoly profits in that market. 

 

That would produce the efficient solution and still reward the pharmaceutical company for its innovation with the new drug. If the demand for the new drug was known up front, this would be the sensible solution. 

 

Of course, it's not that simple. The demand for the new drug isn't known so readily. Have doctors been convinced by the marketing they've received or not? Even with that, there will be inertia as to whatever was prescribed before the new drug hit the market. The demand is apt to grow over time for this reason. And perhaps other uses for the drug are found after its release. That too would increase demand. This will be learned over time and won't be fully evident at the outset.

 

So let's imagine bargaining between the government and the pharmaceutical company happening on an annual basis. They are to bargain over drug price and the lump sum the government will pay the company. They will use the past experience of price, volume of drug use, and the company report on profits of the drug to help determine this year's bargain. The government will understand that the drug company has incentive to overstate profits from last year, to inflate the lump sum payment this year. Likewise, the government has incentive to lessen the lump sum payment somewhat, in anticipation of the drug company's behavior. But to the extent that transaction prices and volume of transactions can be accurately measured, the profit assertions will have be brought in line with that. 

 

Over time the hope would be that the drug price falls to near marginal cost. (What a name brand would charge as a premium in the presence of competition from a generic alternative means it won't fall all the way to marginal cost.) And the drug companies are happy with the lump sum payments they receive from the government while the drug is under patent. 

 

Could this actually happen? If only wishing would make it so.

Confrontation with My Own Cheating

My wife and I do the Spelling Bee, one of the games in the NY Times. She goes first and gets as many words as she can. Then it is my turn. I see if I can get the rest. We usually make it to Genius level, their highest ranking. Sometimes we get to Queen Bee, which means we got all the words.

We use the hints that they publish. To us, that is not cheating. The hints give how many words start with the same first two letters, also the length of the words starting with the same first letter (the minimum length is 4 letters).

The fun in doing this is in guessing the words themselves, given the seven letters they give you, where the letter in the center must be in the word, and there are 6 other letters that can be used in the word. Letters can be used more than once.

Sometimes, you look for additional help. With four letter words you can brute force an answer, especially when the center letter is not one of the first two letters. This is a kind of cheating. But, on the flip side, if you've never heard of the word before you certainly won't guess it. The vast majority of words are familiar. But these puzzles do include obscure entries. IMHO, cheating on those is acceptable.

A second type of cheating that I've discovered is by using an online dictionary. I use Dictionary.com. If you type in the first few letters, it will suggest full words that begin that way. Once in a while, such a word can be made with the letters provided in the puzzle. I've actually found many words this way that the puzzle does not accept. Usually they are technical terms, or the English version of words from a foreign country. Also, if a word has two different spellings, the puzzle might only accept one of those. So it is a bit arbitrary. In any event, this type of cheating can produce words that I should have guessed in advance. Then I have some regret from doing it. On the other hand, even though I'm retired I don't want to spend the full day doing this puzzle.

The most egregious form of cheating is following the Community link. There someone has posted answers - though in hint form, not the words explicitly. Going there is the last resort, for when you're ready to give up on the puzzle. It's good for words you've never heard of before. Last Sunday, one of the words was Haboob. It's been a very long time since I studied vocabulary for the SAT, but I don't think that haboob was on the list. (And typing now, the browser is giving a red squiggle under it, so maybe it's not really a word.)

At present I have 54 words out of 55 in total for today's puzzle. I know the first two letters of that last word and how many letters it has. I'm procrastinating on deciding whether to keep guessing at this last word or cheating on it.

Procrastination is its own form of cheating. I do it a lot. Some role model for our students, huh?

When There Is No N R G

Is this guy slacking
With effort apparently lacking
Because he has no oomph?

Here it bears repeating
The person isn't cheating
He simply is a schlump.
#LackingJazzWithNoPizazz

The Last Draw

Instead of relying on a pencil
The geezer made use of a utensil
For sketching in the mashed potatoes
Highlighted nicely with cherry tomatoes.
#ReleasingYourInnerKid