Over-training puts up prices -nice for cartels of doctors, pharmacies etc but bad for everybody else

One of the reasons why medical care is so expensive in Britain and America, I suspect, is the number of doctors is limited in various ways and the training is so long. I have yet not accumulated the evidence I need to prove this and I might be wrong. But I am encouraged by this Bloomberg story from Italy.

Prices for many pharmaceuticals in Britain are quite reasonable, I think, partly because even supermarkets are allowed to sell all that do not require a prescription. But in many parts of the continent, I get the impression that you can only get them from remarkable smart, small pharmacies that charge heavily for rather basic things.

This story from Italy seems to be a case in point whereby by cutting out a requirement for training that is not necessary, prices can be reduced. I suspect the same sort of thing applies to many areas of medicine. Also, in Britain at least, the government limits the number of people who can go to medical courses at university. This automatically reduces the supply of doctors and increases the prices they can charge.

In this Bloomberg story, the Italian government gave permission for a new kind of pharmacy with less qualified staff:

Borgo, the pharmacist on the Venetian island that hosts the city’s film festival this week, took advantage of a law in 2006 that Berlusconi’s party subsequently tried to reverse.

The measure paved the way for “parafarmacie” and required that their managers had graduated at least five years before and worked for two years in a licensed drugstore. They operate alongside pharmacies like paramedics compared with doctors.

“I joined forces with a former pharmacy trainee and two years ago, we opened a parafarmacia on the high street,” Borgo said by telephone. “Today we make enough money to employ a part-time assistant.”

The law increased competition in an industry that has annual sales of 19.2 billion euros in Italy, figures from the pharmaceutical industry group Farmindustria show. Since then, almost 3,500 independent drugstores have been opened, currently employing about 7,000 people, according to the Forum Nazionale Parafarmacie group.

‘Old Privileges’

bill put forward three years ago by Senator Luigi D’Ambrosio Lettieri, a member of Berlusconi’s party in Italy’s Upper Chamber, imposed restrictions on the kind and number of medicines new drugstores like the one opened by Borgo can sell.

Lettieri is the vice president of the pharmacist federation, which opposed the creation of parafarmacie. The law still requires a final vote by both houses after being approved by committees.

“Any previous initiatives by lawmakers to block or reduce the size and the scope of liberalizations and restoring old privileges will come to an halt in the light of the government’s” new measures, Catricala said. Those initiatives “won’t be politically compatible any longer,” he added.

On Lido, it’s no surprise Borgo, a mother-of-four who graduated in 1994 and worked first as a researcher for what became GlaxoSmithKline Plc (GSK)Europe’s largest drugmaker, has made some enemies in the last three years, she said.

Resistance to change “can be worse than any legal obstacles,” said Borgo.

Full story on Bloomberg here.

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5 Responses to Over-training puts up prices -nice for cartels of doctors, pharmacies etc but bad for everybody else

  1. john says:

    Do we need any pharmacists? With modern logistics and computers a doctor could easily arrange for any prescription to be delivered to ones door within 24 hours. Only emergency prescriptions would need to be collected, and a trained monkey could dispense most of those.

    Bad for pharmacists – good for postmen.

    However, the most overtrained group in the NHS has to be the nurses. We regularly hear about patients being neglected, unfed, and left to lie in their own faeces, and I’m convinced this has become worse since nurses were elevated to graduate status. They see themselves now as far too important to wipe peoples bottoms.

    We need more, lesser qualified nurses to do what nurses traditionally did – nursing. We don’t need graduates sat in offices and at reception desks.

  2. No-one wishes to return to the days of the Quack or the snake-oil salesman, but this is a first rate example of how trades and professions have raised the cost of entry into their particular field. The London Guilds were so exclusive that they caused a thriving unregulated and ‘illegal’ free market south of the Thames in Southwark.

    Listen to the screams of anguish coming from the teaching unions about the suggestion that ex-soldiers should be recruited to become teachers – or indeed that ‘free’ schools should be allowed to enter the market.

    I’m not saying that no qualifications are necessary, but many are scarcely relevant to the actual needs of the job (e.g. many degrees) which would be better leaned ‘on-the-job’ apprentice style than in an institution with its inevitable bias towards self-preservation.

    • HJ says:

      There is, of course, nothing wrong with qualifications, as you observe.

      The problem is licensure – because it removes the ability of the individuals and organisations to decide for themselves what is an appropriate level of qualification and training.

  3. David says:

    I think there is a need for training for pharmacy. (I am not and never have been a pharmiscist.)
    My wife is Colombian and we have been there I have been amazed by the bad advice that you get given in pharmacy.
    For example once her niece had an infected lip and was advised to take cold sore cream (even I could see it was not a cold sore).

    “I’m not saying that no qualifications are necessary, but many are scarcely relevant to the actual needs of the job (e.g. many degrees) which would be better leaned ‘on-the-job’ apprentice style than in an institution with its inevitable bias towards self-preservation.”
    I agree with that 100%

  4. HJ says:

    It’s not just over-training that is the problem, it is that training at present appears to be designed for the benefit of preserving medics’ career options, i.e. medical degrees are always generalist, only allowing for specialisation much later.

    This is as if universities were only to offer degrees in general engineering, but not in mechanical engineering, electronic, electrical or civil engineering.

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