It is a hard fact that free enterprise made America into the world’s premiere, free and pluralistic country it still is today. But apparently it is not considered equally and universally that that same free enterprise will keep America a free and prosperous country in the future.
There are those that believe government is the cure-all, of which we need more. I suggest to look at another hard fact: the public sector requires lots of funds but does not produce any [funds]. Only the private sector can produce the revenue that enables government to exist.
This leads to a very simple calculation: more private sector produces more prosperity; more public sector diminishes prosperity.
Critics may call this a simplistic calculation, but imagine this equation with extreme values and see where it leads.
As so often, nobody knows for sure where the pivotal point is, but like on a well-designed dive board, the fulcrum is between the long free-swinging part and the short fixed one.
Personally, I make the case for free enterprise, because I believe that free and fiercely competitive markets are the best friend of the consumer, whereas government regulations ultimately only drive up prices and keep competition out.
Let’s look at an anecdotal, yet highly relevant example within the distribution end of the pharmaceutical industry. For disclosure purposes, I am part of this industry.
Less than a handful of powerful PBMs (Pharmacy Benefit Managers) like CVS-Caremark, Medco, Xpress-Scripts, etc. control over 90 percent of this market. The stakes are high in a $400 billion market with healthy margins and large corporations defending their turfs often with strong-arm tactics.
Enter a new breed start-up headed by an innovative insider of the healthcare industry. A traditional approach of a new market entrant would have looked something like this: Lower prices of services, thus reducing the margins and try to convince customers to shift their business on the grounds of lower cost, still leaving the consumers (as usual) out of the loop.
The innovator RxCut chose a totally different, out-of-the-box approach that actually empowers the consumer with the help of a completely transparent pricing model. Based on this model, the consumer asks the dispensing pharmacist for the lowest price for a given prescription and the pharmacist is enabled under RxCut’s competitive and consumer friendly processing policy to dispense the drug at the lowest price point, be it the consumer’s insurance co-pay, the cash price or the RxCut discounted price.
In contrast, most PBMs’ contracts require pharmacists to collect the insurance co-pay, even when the actual cash price of a given drug would be much lower, which is often the case with generics.
RxCut’s savings range from 10 to 75 percent and average at about 35 percent. Now this is what I call free market innovation without regulation that helps consumers, insured or not, in a big way.
Best of all, the discount card is available to all consumers, without any restrictions for free and can even be printed off the Internet (http://alturl.com/rsomt).
This example illustrates well how powerful a force the American entrepreneur and the market is and yes, we need government for vital functions, but let’s remember what we mean by vital in the sense of what our founding fathers figured out centuries ago. The case for more enterprise and less government is clear and the only way out of the debt morass we find ourselves in.
Ben Leuenberger
Peachtree City, Ga.
