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Jens 'n' Frens
Idle thoughts of a relatively libertarian Republican in Cambridge, MA, and whomever he invites. Mostly political.
"A strong conviction that something must be done is the parent of many bad measures."
-- Daniel Webster
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Thursday, June 05, 2003 :::
Colby Cosh has a couple entries on the differential between American pharmaceutical prices and Canadian prices. In his first entry, he suggests that the primary difference is that Canada has an oligopsony. That's what I've always assumed, and it's bugged me -- if some third-world country wants to pay marginal costs, I'm okay with that, but Canada should share the R&D costs that Americans have to pay. But here's a follow-up entry:
John Hall points out that in 2000, the Fraser Institute (Canada's analogue to the Cato Institute) studied the pharmaceutical price differential using 1990 data and concluded that the reason for it was American litigiousness. "There is evidence that one-third to one-half of any pharmaceutical price differentials... were due to the higher cost of protection from legal liability in the United States. In Canadian courts, compensation for personal injury is capped at CDN$250,000 and judges rarely award large liability settlements." Unfortunately John's link to the original study doesn't work, but I'll trust him to have cut and pasted the quote properly.
$180,000 American seems a bit low to me, though Canadians don't pay their own health care, or at least most of it. So -- unless I'm mistaken -- that's basically pain and suffering.
I think the Massachusetts legislature was talking about capping medical malpractice punitive damages at $500,000, with no limit for compensation. I could go for a pain-and-suffering cap, too, but I think $500k to $1 million is about right.
::: posted by Steven at 3:02 PM
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