Resmed strikes again

Just to avoid giving that Australian manufacturer any free mentions is all. No reason not to name the model of mask, etc.

roster wrote: Anyway, deep at the root of the problem is government regulation, not ResMed. If there were no government requirements for prescriptions, used equipment would be readily sold on Ebay and cpapauction.com would likely have never existed.

I hate to say it, but in this case, I'd rather see more government regulation - to prevent ResMed's regulation.

Rogue Uvula wrote:

roster wrote: Anyway, deep at the root of the problem is government regulation, not ResMed. If there were no government requirements for prescriptions, used equipment would be readily sold on Ebay and cpapauction.com would likely have never existed.

I hate to say it, but in this case, I'd rather see more government regulation - to prevent ResMed's regulation.

Government regulations is how Resmed gets by with what they are doing. Plus government regulations makes you have a prescription to buy a mask or cpap machine. If not for that we could go to Wally World and buy a cpap for $99.99 and mask for 0ne tenth the price of what we pay now. Government is allowing Resmed and other medical equipment manufacturers to harpoon you right up the co2 carbon canal. How does it feel?

Rogue Uvula wrote:

roster wrote: Anyway, deep at the root of the problem is government regulation, not ResMed. If there were no government requirements for prescriptions, used equipment would be readily sold on Ebay and cpapauction.com would likely have never existed.

I hate to say it, but in this case, I'd rather see more government regulation - to prevent ResMed's regulation.

If adults don't understand causation, maybe they can understand correlation. Look at the industries whose markets are lightly regulated - great suppliers, great products, good prices, happy customers. Now look at the ones which are heavily regulated and see how badly the suppliers act to us, the customers. The suppliers focus on the regulators and the regulations and use the regulations to keep out competition and have their way with the customers. Our options are limited when industries are heavily regulated.

When you pass Logic 101, you may realize a free market works very well for us consumers and a heavily regulated market works for the entrenched suppliers and against us consumers. There is causation in this case.

roster wrote:The suppliers focus on the regulators and the regulations and use the regulations to keep out competition and have their way with the customers. Our options are limited when industries are heavily regulated.

Lots of people have simple box fans in their homes. What do those cost, 30 bucks? I've seen them for half that. They're way less complicated than a PAP machine, for sure, but the point here is that if you needed a $3000 study and an Rx before you could get a box fan, how much demand would there be for it? And with the demand low, it would not pay competitors to get into that business as much as a different business where the demand is high and regulation is light.

Here's an example of high demand. A laptop is way more complicated than a PAP machine. How come you can buy a laptop for $300? BECAUSE EVERYONE WANTS ONE, and it pays well for competitors to get into a business where there is plenty of demand to go around. Competition drives the price down.




On a related subject, I truly do not understand why you need an Rx to buy a machine and especially why you need an Rx to buy a mask. Probably Ex-Lax is more dangerous than a CPAP machine, but you can buy that over the counter. I just don't get this.

LoQ wrote:

Here's an example of high demand. A laptop is way more complicated than a PAP machine. How come you can buy a laptop for $300? BECAUSE EVERYONE WANTS ONE, and it pays well for competitors to get into a business where there is plenty of demand to go around. Competition drives the price down.

That is a good example of quality products at low prices in an industry that is not heavily regulated.

High demand does not have to exist just to create quality and low price. An unregulated market is the only requirement.

Among my favorite examples, because I shop there so often, are Dick's Sporting Goods, Sports Authority, Sierra Trading Post, and some of our local sporting goods stores. These businesses are lightly regulated and the products they sell are lightly regulated. Some of the items they sell are relatively low demand, yet still are high quality and low price.

An example of a low demand item is hiking poles. These are readily available from all the stores I mentioned plus others including WalMart. You can pay for a pair anywhere from $20 to $200. Even the $20 poles are decent quality but a bit heavier than the more expensive ones. Recently I was able to buy a nice lightweight $70 pair for $20 including S&H.

I don't use the poles (I choose to live riskily and will probably die that way) but others do and claim they add a big safety factor to their climbs. Now let the Consumer Product Safety Commission get wind of these poles and watch them issue standards and regulations to "keep the citizens safe". What happens then is easily predictable. The decent-quality low-end poles disappear from the market, the number of manufacturers shrinks, WalMart quits selling the poles, the prices shoot through the roof, and there are no big discount sales.

So now has the government "kept the citizens safe"? Hell no, they have driven up the cost, driven out competition and fewer and fewer people are purchasing and using the poles. The citizens are less safe thanks to government!!!

This same principle is at work in the CPAP market.

roster wrote: That is a good example of quality products at low prices in an industry that is not heavily regulated.

High demand does not have to exist just to create quality and low price. An unregulated market is the only requirement.

Roster I largely agree with you but I think some regulation can be beneficial.

For example here in Oz there is no need for a prescription for a xPAP or mask. We do have regulation that prevents Resmed from dictating what price retailers can charge. Perhaps it's because it relates to all industry (not a particular one) or perhaps because it is targeted specifically at pricing that makes the difference.

Having said that our prices are far higher than US prices for the same equipment. However I think this is more to do with population and distance than regulation. It does irk me that a machine made by an Australian company costs more here than overseas but I suspect none of it is made here.

Do you think some regulation can be justified, particularly in a market with a limited number of players?

Gerald? wrote: Do you think some regulation can be justified, particularly in a market with a limited number of players?

Gerald,

Speaking for the U.S., almost all market regulation is a bad thing. It drives up costs, drives down quality, selection, availability, and customer service.

Competition and the fear of failure is what makes markets work to the benefit of the consumer. Without competition and the fear of failure, companies may behave as badly as governments. Recently in the U.S., our government has taken huge steps to keep companies and individuals from failing. You can imagine what happens if parties know they are going to be bailed out - they do not act responsibly and often take high risks. Government distorts the market and causes very bad things to happen when they remove fear of failure from the market.

In the industries which are heavily regulated, the government bureacracy protects the entrenced suppliers and holds down competition and fear of failure. The suppliers use the regulations to keep an advantage over potential new entrants. The suppliers also shift much of their focus to the regulations and the government regulatory bureaucracy and away from the customers. Of course, this is very bad for the customers.

There are some exceptions in industries with monopolies or strict oligopolies. In the case of monoploies and oligopolies, competition does not exist, or is very limited, and the consumer does not have choices. Some limited regulation can be justified. However, you have to be careful that the regulation does not help entrenched suppliers and keep new entrants out of the industry.

Much of the medical field, including insurance and equipment suppliers, is heavily regulated in the U.S. and you can see in the forum examples of what we get - It drives up costs, drives down quality, selection, availability, and customer service.

In such a competitive market, the manufacturers have freedom to fix the retail price. But what always happens in competitive markets, the manufacturers who choose this route soon fall behind the competition and will change their policies or fail.

Let me add that when we talk about free markets, we still believe very strongly in the rights of individuals and the responsibility of governments to protect those individual rights. In a free market all transactions are voluntary. Force, deception, and fraud are illegal and the most egregious cases are prosecuted (In minor cases, the consumers migrate to other suppliers and the fraudulent supplier suffers and then changes or fails). Cartels, price fixing and conspiracies among competitors are also illegal and prosecuted.

Also regarding your complaint that ResMed prices are higher in Oz than U.S., my friends in Germany complain that BMWs and Mercedes manufactured in Germany are much more expensive in the U.S. than in Germany. This is because German laws limit and tax imports of automobiles from other countries. Their laws also make it more difficult and more expensive to be a dealer of imported cars. This is another example of government regulating a market and driving up the cost to consumers and holding the selection and availability down.

Assuming that ResMed has a very high market share and is well entrenched in Oz, what do you think would happen if the market for equipment were thrown wide open by the regulators? Would both internet and small B&M companies spring up by the dozens? As a result would prices fall rapidly, quality and selection increase, and consumer satisfaction increase? I think so.

What specific examples can you think of where it is justified to regulate a market?

roster wrote:What specific examples can you think of where it is justified to regulate a market?

The manufacture and operation of airplanes and nuclear power plants.

Check this out:
Walmartrx.$100cpap.com

chunkyfrog wrote:Check this out:
Walmartrx.$100cpap.com

Can you post a link to whatever it is? I'm sure many of us might be interested in it.

LoQ wrote:

roster wrote:What specific examples can you think of where it is justified to regulate a market?

The manufacture and operation of airplanes and nuclear power plants.

That is a very general statement that offers no specifics.

If there were no regulations on nuclear power, do you think investors would put huge sums of their own money in an investment that was unsafe? Do you think insurance companies would insure nuclear power companies who build and operate unsafe facilities?

I would feel safer knowing the nuclear station upstream from me was made safe by people and insurance companies who had their own money and careers on the line than by government bureaucrats.

Just look at BP's gulf drilling. Licensed and heavily regulated by the government, yet what a devastating explosion and spill they had!

BP investors (and all companies drilling in U.S. waters) and insurance companies know that their liability has been limited by U.S. government regulations. This government regulation of the market changes behavior and the players take more risk. Also, the licensing and safety regulations create an environment where the companies focus on the regulations and regulators. Focus on true safety becomes secondary and that is not good. Without government regulation and with the knowledge that they will be held fully responsible for all damages, the drilling companies and insurance companies will behave differently and safety will be greatly improved.

LoQ, I don't accept your examples.

roster wrote:LoQ, I don't accept your examples.

I did not think you would.

chunkyfrog wrote:Check this out:
Walmartrx.$100cpap.com

Chunky messin' with 'em.

Eat more frog legs.

thats too bad