It's going to take a 'disruptive moment' to make healthcare more affordable
- Healthcare in the US and around the world is due for a major shake-up.
- We spoke to Cheryl MacDiarmid, an executive at the pharmaceutical company GlaxoSmithKline about one major similarity between the US and Canada's healthcare system: they're unaffordable as both countries' populations age.
- To change this will take a conversation that's not happening right now, and it won't until something disruptive appears, MacDiarmid said.
- It could be the entry of a new player like Amazon, or it could be something painful like a healthcare system running out of funds.
The US healthcare system has a reputation for being too expensive and difficult to navigate.
But the US isn't the only country in the world struggling to afford healthcare. Cheryl MacDiarmid, the senior vice president of primary care at drugmaker GlaxoSmithKline - a Canadian who has worked in both the US and Canada - says her native country faces the same challenge.
"Both Canada and the US cannot afford the health systems they have. Period. Full stop," MacDiarmid said in an interview.
That's in large part because more people in both countries are turning 65 every year, and the older population brings with it an increase in healthcare costs.
Of course, there are big differences in the two medical systems - notably that in Canada the government pays for care. But that just means the inefficiency shows up in different places.
In Canada, it translates to wait times for certain procedures, like an elective knee replacement. In the US, you can get the knee replacement done quickly but it'll cost you as a patient more.
"How we're funding them is different, and in both systems there's massive inefficiency for different reasons," she said.
The exact solutions to each country's woes aren't easy to pin down, but MacDiarmid said it'll likely take the different aspects of healthcare (the companies that make the products, the people using them, and the companies that pay for them) to come together and talk.
Those conversations aren't happening yet, at least not at a point where things will change. Changing that is going to take something substantial.
"It's going to take something really disruptive, like a new player in the mix," MacDiarmid said.
Chatter about Amazon's potential entrance into health care could be that disruption. It's already reportedly sparked a $60 billion+ deal between pharmacy giant CVS Health and health insurer Aetna. The merger would create a new kind of healthcare company that includes a health insurer, a retail pharmacy, and a company that negotiates prescription drug prices with drugmakers, giving CVS more control over the connection between drugmakers and patients.
But alternatively, the disruption could be a lot more painful experience if countries going bankrupt because of their healthcare costs and need to find drastic ways to make changes.
"I think there's a disruptive moment coming, I just don't know when," MacDiarmid said.