The Economics of Medical Miracles

The Academy Health* blog presents an interesting quandary in health economics. We aren't quite there yet, but the day may come soon when it is possible to essentially cure genetic diseases like cystic fibrosis and sickle cell. That sounds great!

The problem is that these are fairly rare diseases, and that the treatment would be administered only once. So, in order to recoup their research and development costs, the purveyors would have to charge enormous prices -- on the order of a million bucks a pop. That's going to make you think, "Oh, this is like those other moral dilemmas about the allocation of scarce resources. We could use that money to save 50,000 African infants or something instead."

Well, yes, but actually we already are spending it on the people with cystic fibrosis and sickle cell anemia -- actually a lot more than that in many cases. We don't begrudge with CF a lifetime of treatment that may cost $6 million, and they would be much happier getting a single treatment that actually cures them. But somebody has to finance it, which means we need to radically rethink how we organize the financing of medical services.

Then there's Norwegian physician Jarle Breivik who discusses Obama's cancer "moonshot" in the NYT. Apart from the well-known problem that cancer is innumerable diseases and there will never be a cure for "cancer" per se, it is true that we can make progress against the multiple diseases called cancer and maybe achieve something we define as a "cure" for a growing percentage of people. The problem is that the rate of cancer increases relentlessly with age; whoever we cure today is very likely to develop cancer again, either from fugitive cells from the original cancer, side effects of chemotherapy and radiation, or because it just happens. And then we're all going to die eventually anyway. Meanwhile, of course, there are still those starving African kids with diarrhea and malaria.

Medicine, in other words, faces a problem of technological imperative. If we can do it, people will demand it, but we have no fair and reasonable way of sorting out competing demands for scarce resources. 


*Academy Health is the research society in health services and policy. Yeah, yeah, it ought be the Health Academy, but it isn't.