Medical Lawsuits

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Ashiwi
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Medical Lawsuits

Postby Ashiwi » Wed Mar 04, 2009 8:03 pm

Given the recent award of 6.7 million to a woman who lost her arm due to a reaction to an IV push dosage of Phenergan, and the impact that costs like these have on the medical industry, what do you guys think of them striking down possible limits on medication lawsuits? The drug manufacturer stood behind its FDA approval as protection against this case, but lost (see Wyeth v. Levine, 06-1249).

I'm torn on reward limitations, because there's the whole question of what would cause a medical entity to exercise caution over potential profit if the penalties are restricted from being severe enough to cause real damage to profit margins. I'm totally against spurious lawsuits and rewards of damages that far exceed a conceptualized loss, but at the same time, a flat-rate system with no rewards for pain and suffering would never offer amounts that would make some of these large medical entities even think twice, since their realized profit would far exceed any potential losses.

I'm not even addressing what I feel about the placement of responsibility in this case, since the reaction was a known occurrence, but the method of treatment was utilized anyway.

Is there a better system that would not only keep medical entity malpractice rates minimized, yet not make such unrealistic settlements so common? If you think 6.8 million for one hand on a musician is unrealistic, that is. Even my bleeding heart does.
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Re: Medical Lawsuits

Postby Gormal » Wed Mar 04, 2009 8:44 pm

On the other hand (oh yeah I went there), if lawsuits weren't so potentially expensive would those hyper-rich companies feel it when someone sued them?
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Re: Medical Lawsuits

Postby teflor the ranger » Thu Mar 05, 2009 12:40 am

They don't feel it anyway, Gormal.
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Re: Medical Lawsuits

Postby kiryan » Thu Mar 05, 2009 7:29 pm

First of all, I'm not torn at all on the supreme court's ruling on the appeal. It allows the lawsuit to go through. Its a very dangerous thing to limit when you can sue. Yes it is abused, but if its a mickey mouse case, it'll get quashed rightfully so.

I don't know whether the drug manufacturer should have to pay 6.7 million because I don't know enough about the case. If the potential side effects were known and not communicated, then I see liability. If the side effects were easily known then the physician should bear most of the responsibility for not communicating the risks. If this was being used in an "off label" capacity, then the physician should bear the risk. If the drug maker was pushing off label use without communicating the risk, then again they should bear the liability.

On the other hand, I think the standard we shoot for legally regarding healthcare fails to take into account that Doctors are "practicing" medicine. Its called practicing for a reason. Imagine if fans started suing pro players for missing shots.
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Re: Medical Lawsuits

Postby teflor the ranger » Fri Mar 06, 2009 2:05 pm

I think perhaps it's not about the lawsuits, whether they are medical, environmental, or contractual.

I think it's about the judiciary. Judgements they make should be just. Unfair punishment is as dangerous to society as the initial crime.
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Re: Medical Lawsuits

Postby kiryan » Fri Mar 06, 2009 4:01 pm

agree, but fair and just is always relative to a standard, to a point of view.

What makes this case interesting is the woman was a musician, and losing an arm certainly makes it difficult to continue in her career... all because no one warned her about some potential side effects? its not like it was a life or death situation, she got a shot then had this complication and now her career as a musician is for all intensive purposes ruined.

I waited 8 years to get Lasik... and I always promised myself I'd do one eye at a time, because its probably pretty hard to be a computer guy and not be able to see. I actually just did both eyes at the same time 2 years ago because its basically safe, but I was very cautious and went to the doctor who had done the most in the local area.
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Re: Medical Lawsuits

Postby amena wolfsnarl » Fri Mar 06, 2009 4:26 pm

In Alberta, Canada they recently put a limit on the amount people can sue for for pain and suffering, and soft tissue damage injuries (whiplash) in autoaccidents, this has saved the insurance companies million. Does that translate into savings for everyone else in thier rates......of course not.
In my opinion if there is a cap put on these type of settlements than it should in turn lower the insurance/medical rates that we pay.

Its my understanding that malpractice insurance is one of the most expensive things in the health care industry. By placing a cap on insurance pay outs, the insurance companies should in turn lower thier rates and that should be passed along to the people who have to pay for thier services.

As far as big companies are concerned i think they need to be held more accountable for thier actions, a few mill dont hurt many of those companies that much. Hell some companies actually budget for legal settlements in any given year.
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Re: Medical Lawsuits

Postby Corth » Fri Mar 06, 2009 4:37 pm

I'm pretty sure your wrong, Amena. Your insurance rates would almost certainly be higher without damage caps.
Having said all that, the situation has been handled, so this thread is pretty much at an end. -Kossuth

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Re: Medical Lawsuits

Postby Sarvis » Fri Mar 06, 2009 4:52 pm

Corth wrote:I'm pretty sure your wrong, Amena. Your insurance rates would almost certainly be higher without damage caps.


Why? The insurance companies found a price the market would bear, it's not likely to go down.
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Re: Medical Lawsuits

Postby kiryan » Fri Mar 06, 2009 8:57 pm

competition... the free market... addresses that.

amena, that kind of thinking, insurance companies have millions to spare so it doesn't matter if we give someone millions they don't deserve is precisely why we have this problem. Remember the 5 million dollar punch back from the 80s? Some guy in CA I believe won a jury award for 5 fucking million dollars because someone punched him in the face. I believe most of it was overturned, but it was a ridiculous award in the first place.
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Re: Medical Lawsuits

Postby Sarvis » Fri Mar 06, 2009 9:07 pm

kiryan wrote:competition... the free market... addresses that.



If you say so.
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Re: Medical Lawsuits

Postby Corth » Fri Mar 06, 2009 9:19 pm

Sarvis wrote:
Corth wrote:I'm pretty sure your wrong, Amena. Your insurance rates would almost certainly be higher without damage caps.


Why? The insurance companies found a price the market would bear, it's not likely to go down.


For the same reason GEICO is always advertising about how much money they can save you if you switch to them.
Having said all that, the situation has been handled, so this thread is pretty much at an end. -Kossuth



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Re: Medical Lawsuits

Postby Sarvis » Fri Mar 06, 2009 9:29 pm

Corth wrote:
Sarvis wrote:
Corth wrote:I'm pretty sure your wrong, Amena. Your insurance rates would almost certainly be higher without damage caps.


Why? The insurance companies found a price the market would bear, it's not likely to go down.


For the same reason GEICO is always advertising about how much money they can save you if you switch to them.


Is that like the commercials with Smilin' Bob?

Just because they say you can save money with Geico, doesn't mean they have the cheapest rate. Allstate is ALSO saying they'll save you money. Are they both right? Or do they say that, then treat each individual case separately so that you can never really tell if you're going to save money or not?

Do you charge less than all the other lawyers in your area, Corth? Or do you charge about the same?
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Re: Medical Lawsuits

Postby Corth » Fri Mar 06, 2009 10:11 pm

Actually.. I switched to Geico and saved a whole lot over State Farm. I'm sure your mileage may vary. Point is that people will often go with the insurer that offers the best value. It isn't a situation where the market will bear a certain price. Its a situation where the companies that cannot compete go out of business. Happens all the time.
Having said all that, the situation has been handled, so this thread is pretty much at an end. -Kossuth



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Re: Medical Lawsuits

Postby amena wolfsnarl » Fri Mar 06, 2009 10:20 pm

Corth wrote:I'm pretty sure your wrong, Amena. Your insurance rates would almost certainly be higher without damage caps.


sorry i thought i said there is a damage cap
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Re: Medical Lawsuits

Postby Sarvis » Fri Mar 06, 2009 10:29 pm

Corth wrote:Actually.. I switched to Geico and saved a whole lot over State Farm. I'm sure your mileage may vary. Point is that people will often go with the insurer who is perceived to offer the best value. It isn't a situation where the market will bear a certain price. Its a situation where the companies that cannot compete go out of business. Happens all the time.



Fixed that for you.



No answer for the question on how much you undercut other area lawyers?
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Re: Medical Lawsuits

Postby Corth » Sat Mar 07, 2009 12:32 am

Sarvis, are you saying that I didn't compare the cost of my old insurance and switch to geico because it was cheaper?

As a consumer, I am constantly taking price into account before I buy something. If the gas station down the street is cheaper than the one in front of me, I keep driving. When I wanted to buy a portable DVD player last month, I went to pricegrabber.com to find the retailer selling the model I wanted at the cheapest price. I goto web sites like retailmenot.com to get coupon codes. I also use sites like fatwallet.com to find great deals and to get a kickback on the affiliate share that they get when I buy from online retailers.

When you want to buy something, Sarvis, do you not compare prices?

As for what I charge my clients.. I try and get paid as much as I can. Emphasis on the getting paid part. If my fee is excessive nobody will retain me to represent them. Working for less is better than not working at all. I am constantly competing on price.
Last edited by Corth on Sat Mar 07, 2009 12:40 am, edited 1 time in total.
Having said all that, the situation has been handled, so this thread is pretty much at an end. -Kossuth



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Re: Medical Lawsuits

Postby Sarvis » Sat Mar 07, 2009 12:39 am

Corth wrote:Sarvis, are you saying that I didn't compare the cost of my old insurance and switch to geico because it was cheaper?


I'm willing to bet you considered other factors. I'm also willing to bet you don't compare prices every time your insurance comes up for renewal, either. Has Geico changed your rate a few times since you signed up? They have mine...

As for what I charge my clients.. I get paid as much as I can. Emphasis on the getting paid part. If my fee is excessive nobody will retain me to represent them. Working for less is better than not working at all. I am constantly competing on price.


But you could charge even less, right? You say you're competing on price, but I'm betting you're billing about the same rate as other lawyers in your area. Why not drop your rate another 10% tomorrow?
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Re: Medical Lawsuits

Postby Corth » Sat Mar 07, 2009 12:44 am

Hrmm.. no I didn't consider any other factor but price. Its the same policy so thats all that really matters. Every so often I do ask for a quote from a competing company but so far nobody has beaten the price I'm getting.

As for what I charge. Like I said, I charge as much as I can get away with. If I could charge more, I would. Which is kind of the point. When I first started out and I had no work to do, so I charged way below market. As I got busier I increased my fees. This caused me to lose some business, but the work that I was doing paid me well. I hope to charge a lot more in the future!
Having said all that, the situation has been handled, so this thread is pretty much at an end. -Kossuth



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Re: Medical Lawsuits

Postby Corth » Sat Mar 07, 2009 12:48 am

Corth wrote:When you want to buy something, Sarvis, do you not compare prices?


You didn't answer this question Sarvis.
Having said all that, the situation has been handled, so this thread is pretty much at an end. -Kossuth



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Re: Medical Lawsuits

Postby Sarvis » Sat Mar 07, 2009 12:52 am

Corth wrote:
Corth wrote:When you want to buy something, Sarvis, do you not compare prices?


You didn't answer this question Sarvis.


Probably because you edited that in... I didn't delete anything from the parts I quoted.

EDIT: Or not, because I know you edited in the second paragraph and it only shows one edit in total. MAybe I missed it and accidentally deleted it? Wierd...

Anyway, frequently I do not. Then again, a lot of the things I buy (video games or books) are MSRP. Computer parts I'm usually looking for specific features and good reviews over cheapest price, the few parts I have bought on price have been power supplies which burned out so this time I went with a more expensive power supply. I don't comparison shop on groceries because, frankly, the hour I'd lose going to multiple stores is worth far more to me than the 50 cents I'd save on milk or whatever.
Last edited by Sarvis on Sat Mar 07, 2009 12:58 am, edited 1 time in total.
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Re: Medical Lawsuits

Postby Sarvis » Sat Mar 07, 2009 12:54 am

Corth wrote:Hrmm.. no I didn't consider any other factor but price. Its the same policy so thats all that really matters. Every so often I do ask for a quote from a competing company but so far nobody has beaten the price I'm getting.

As for what I charge. Like I said, I charge as much as I can get away with. If I could charge more, I would. Which is kind of the point. When I first started out and I had no work to do, so I charged way below market. As I got busier I increased my fees. This caused me to lose some business, but the work that I was doing paid me well. I hope to charge a lot more in the future!



So what you're saying is that competition is not forcing your prices lower. Thought so.
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Re: Medical Lawsuits

Postby Corth » Sat Mar 07, 2009 1:13 am

Sarvis.. for some reason you won't admit that people are capable of doing things in their own best interest.

And I don't believe for a second you are buying computer parts, even high end parts, and not shopping around for the best deal on a particular part. If that is indeed the case.. well.. you should hire me to be your lawyer!
Having said all that, the situation has been handled, so this thread is pretty much at an end. -Kossuth



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Re: Medical Lawsuits

Postby Sarvis » Sat Mar 07, 2009 1:18 am

Corth wrote:Sarvis.. for some reason you won't admit that people are capable of doing things in their own best interest.

And I don't believe for a second you are buying computer parts, even high end parts, and not shopping around for the best deal on a particular part. If that is indeed the case.. well.. you should hire me to be your lawyer!


I have no trouble believing people do things in their own best interest. I have a LOT of trouble believing that anyone ever has all the information they need to correctly identify what that is. I'm also not convinced that these insurance companies can make more money by competing the price down than they can by leaving it as is.

For instance, you're not dropping your price. You can make more money at your current price than you could if you dropped it, even though you have competition. Correct?


As for computer parts, I have compared prices in the past... but newegg always came out cheaper so I stopped bothering.
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Re: Medical Lawsuits

Postby Corth » Sat Mar 07, 2009 1:26 am

Sarvis,

You have it all wrong. I keep mentioning how much I would like to charge even more - and yet I can't. Thats the point!

Heres an example. I used to do a lot of RE closings. I would usually charge $1,000, which was in the middle of the price range for that type of work. A lot of people became RE attorneys during the boom, and now that its a bust, these guys don't have much work. I've seen people lately advertising that they will do closings for as little as $400. Lots of RE attorneys, few RE sales.. cheaper prices for consumers. What will eventually happen is that a lot of these guys will find they can't make a living doing RE law anymore, so they will find something else to do, and prices will normalize to some extent.
Having said all that, the situation has been handled, so this thread is pretty much at an end. -Kossuth



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Re: Medical Lawsuits

Postby Sarvis » Sat Mar 07, 2009 1:37 am

Corth wrote:Sarvis,

You have it all wrong. I keep mentioning how much I would like to charge even more - and yet I can't. Thats the point!

Heres an example. I used to do a lot of RE closings. I would usually charge $1,000, which was in the middle of the price range for that type of work. A lot of people became RE attorneys during the boom, and now that its a bust, these guys don't have much work. I've seen people lately advertising that they will do closings for as little as $400. Lots of RE attorneys, few RE sales.. cheaper prices for consumers. What will eventually happen is that a lot of these guys will find they can't make a living doing RE law anymore, so they will find something else to do, and prices will normalize to some extent.


In the middle of the price range? Sounds like you _were_ charging more! Competition didn't force you to charge lower prices than your competitors.

Plus, you say you can't charge more right now... but you _are_ charging more as long as you could charge less. You're keeping your prices, apparently, in the mid-range for what you do. Just like these insurance companies would. Sure they _could_ lower their prices because their insurance payouts were capped... but they don't see any reason to any more than you see one to drop your prices 10% tomorrow morning.
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Re: Medical Lawsuits

Postby Corth » Sat Mar 07, 2009 2:50 am

No, $1000 was right around in the middle of the price range. Its what I still charge, but I'm not getting very much RE business now. If I wanted to get more RE business I would lower the price and advertise it - like the guys doing it for $400. However, my time is more lucratively spent doing other things.

Let me try coming at you from a different angle. What exactly do you think defines what the normal price range for a product or service is? Lets say, for instance, I wanted to get laser eye surgery. I search google and I see that I can get the procedure done from around $1,500 to $3,000. How come the eye surgeons aren't charging $15,000 to $30,000? What, in your opinion, caused that particular service to fall into that particular range?

2 liter bottles of Coca Cola were on sale at my supermarket today. 4 bottles for $5. How come they aren't charging $50 for 4 bottles? It wouldn't be illegal. Why did the price of 2 liter bottles settle in a range of a dollar or two?
Having said all that, the situation has been handled, so this thread is pretty much at an end. -Kossuth



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Re: Medical Lawsuits

Postby Sarvis » Sat Mar 07, 2009 3:13 am

I think there are two reasons why the laser eye surgeons charge $1500, you charge $1000 and Coke charges $f for 5 bottles.

1) That is the price people are willing to pay. If people were not willing to pay you $1000, you would not charge it. But they are, so you do. People are willing to pay you that price even though others offer a price less than half yours. No one likes coke enough to pay $50, regardless of competition. In fact, I would counter that many people still buy coke when Pepsi is on a better sale!

2) You said it yourself, your time can be spent in better ways. The laser eye surgeon, and presumably you, could not handle a large influx of new customers if prices dropped. If a laser eye surgeon dropped his prices, he can't necessarily serve more clients so he loses money.
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Re: Medical Lawsuits

Postby Corth » Sat Mar 07, 2009 3:26 am

Its funny how you understand exactly how competition works, why it works, and then you do everything you can to come up with reasons not to acknowledge it exists.
Having said all that, the situation has been handled, so this thread is pretty much at an end. -Kossuth



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Re: Medical Lawsuits

Postby teflor the ranger » Sat Mar 07, 2009 6:02 am

Corth wrote:Its funny how you understand exactly how competition works, why it works, and then you do everything you can to come up with reasons not to acknowledge it exists.


He needs an excuse, that's why. If you can't succeed, try to fail.

Sarvis: you should ponder about why people are willing to pay a certain price.
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Re: Medical Lawsuits

Postby Corth » Sat Mar 07, 2009 12:46 pm

I don't know about you, Teflor, but if I needed to buy gasoline to get to work I would pay $4.00 per gallon or more if necessary. In fact, not so long ago thats what I was doing. Its a wonder gasoline is so much cheaper now... since just about everyone is willing to pay a lot more for it.
Having said all that, the situation has been handled, so this thread is pretty much at an end. -Kossuth



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Re: Medical Lawsuits

Postby Ashiwi » Sat Mar 07, 2009 1:56 pm

Corth wrote:I don't know about you, Teflor, but if I needed to buy gasoline to get to work I would pay $4.00 per gallon or more if necessary. In fact, not so long ago thats what I was doing. Its a wonder gasoline is so much cheaper now... since just about everyone is willing to pay a lot more for it.


When the price of a gallon of gasoline hit $4.00, people went into an uproar over the cost, and there was a massive surge of convenience environmentalism. People were demanding alternatives. Notice how, as soon as the price of gas dropped, the demand for research into affordable and renewable alternatives almost dried up. Yes, people would pay $4.00 a gallon, but they would also feel the need to look for an alternative product. Dropping the price is how they keep people complacent and buying the product.
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Re: Medical Lawsuits

Postby Corth » Sat Mar 07, 2009 2:19 pm

I was with you until the last sentence.

Its funny.. I think we had this debate somewhere. My position was that high gasoline prices were just about the best thing that can happen for environmentalists. Years of unfulfilling talk started to see some real world progress once the economics of green made sense.

The current prices will not last long. We'll see $4.00 again soon enough... perhaps in a year or two. Not too long after that, we'll see $8.00. The idea that somebody is lowering oil prices to keep us complacent is absurd. The countries that control the oil are in danger of collapse due to the sudden drop in cost. Russia, Iran, and Venezuela come to mind immediately. If anything, rather than see us complacent with cheap oil, those countries would rather provoke a war to force prices up.
Having said all that, the situation has been handled, so this thread is pretty much at an end. -Kossuth



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Re: Medical Lawsuits

Postby teflor the ranger » Sun Mar 08, 2009 5:01 am

Corth wrote:I don't know about you, Teflor, but if I needed to buy gasoline to get to work I would pay $4.00 per gallon or more if necessary. In fact, not so long ago thats what I was doing. Its a wonder gasoline is so much cheaper now... since just about everyone is willing to pay a lot more for it.


The willingness of consumers to pay is dymanic, much like the market itself. Right now, I wouldn't be willing to pay $3, would you?
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Re: Medical Lawsuits

Postby kiryan » Sun Mar 08, 2009 10:53 pm

lol, and i thought I was a conspiracy theorist. Gas prices went to lower because the Saudis are fearful that we'll reach some technological breakthrough in clean energy NOT BECAUSE WE ARE IN A RECESSION AND CONSUMPTION DECREASED AT THE SAME TIME SUPPLY INCREASED.

however, you again are completely wrong. Gas prices were raised so Bush could get paid for the war by the Iraqis with their increased revenue AND gas prices were chopped because Venuzela, Russia and Iran got too surly for their britches and we promised North Korea a ton of energy aid and we don't want to buy it at high prices.
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Re: Medical Lawsuits

Postby teflor the ranger » Tue Mar 10, 2009 5:54 pm

kiryan wrote:lol, and i thought I was a conspiracy theorist. Gas prices went to lower because the Saudis are fearful that we'll reach some technological breakthrough in clean energy NOT BECAUSE WE ARE IN A RECESSION AND CONSUMPTION DECREASED AT THE SAME TIME SUPPLY INCREASED.


What do you mean? Consumption worldwide has dramatically decreased.
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Re: Medical Lawsuits

Postby Ashiwi » Tue Mar 10, 2009 6:59 pm

Once in a blue moon I do succumb to what you believe to be a conspiracy theory, but I'm not typically prone to buy into such simplistic hogwash.

I think the decrease in gasoline cost is due to a ton of different reasons, including the decrease in consumption, global markets, politics, and the convenience environmentalism backlash. I'm only sorry the belief of the people is so easily swayed by their pocketbooks, and something they believe in strongly becomes a non-issue when it doesn't cost them as much.

And yes, Corth, if the cost of fuel had stayed as high as it was, we'd have a "breakthrough" in very little time. As soon as somebody found what was considered to be a marketable system with a high continuing return, there would be a slew of companies jumping on the wagon to release the new and improved version of it at every turn. I'm probably one of the very few around who was truly sad to see it drop so drastically. Yes, I love the relief at the pump, but I hate the fact that the American people are bought and sold by the dollars they put in their gastanks.
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Re: Medical Lawsuits

Postby oteb » Tue Mar 10, 2009 8:45 pm

I think competition works at a level of local grocery store if you plan to buy a carrot.
Moving just one notch up in in complication to a level of lets say soap. You know absolutely nothing about product unless you are a chemist and a dermatologist at same time. Well you may like the scent. But that's about it.
With something as complex as laser eye surgery you choose between 1500 and 3000$ deal based on pretty much irrelevant information (the looks of doctor's office, nice colors of leaflet etc). Simply picking up all relevant information would consume too much time and effort.
It same as with democracy. It's a fucked up system but nobody invented a better one.
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Re: Medical Lawsuits

Postby kiryan » Tue Mar 10, 2009 9:35 pm

yes teflor. sorry i got carried away with Sarvis' conspiracy theory about why gas got cheaper... i mean it certainly wasnt because of supply and demand fundamentals. it was a conspiracy! he just fingered the wrong conspiricists.
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Re: Medical Lawsuits

Postby Sarvis » Tue Mar 10, 2009 9:44 pm

It doesn't even take conspiracy. It just takes everyone looking at the price of gas and saying:

I could lower prices, and get more customers... but at a lower profit margin. Let's do math... oh wait, I'd not actually make more money. Nope, not lowering prices!

It's funny that Corth charges in the middle of the price range for his job, yet still claims competition and supply/demand force prices as low as possible. It clearly doesn't, or Corth would be on the low end of the price range along with every other lawyer in NYC. Instead not only does Corth charge more than half the lawyers in his area, another 50% of them charge twice as much!

All without conspiracy, just the realization that you might not get as many customers... but you can still make more money for doing less work.
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Re: Medical Lawsuits

Postby Corth » Tue Mar 10, 2009 11:07 pm

Actually, Sarvis, when it comes to RE closings, I explained that my current fee is actually on the higher end (it used to be middle of the pack). I also pointed out that I am not doing much RE business. I can't compete with $500 closings, and I don't try to. I spend most of my time in a niche business that doesn't have a lot of competitors.
Having said all that, the situation has been handled, so this thread is pretty much at an end. -Kossuth



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Re: Medical Lawsuits

Postby Sarvis » Tue Mar 10, 2009 11:29 pm

Corth wrote:Actually, Sarvis, when it comes to RE closings, I explained that my current fee is actually on the higher end (it used to be middle of the pack). I also pointed out that I am not doing much RE business. I can't compete with $500 closings, and I don't try to. I spend most of my time in a niche business that doesn't have a lot of competitors.


Not really the point though, is it? The point is that before the RE closing market got flooded with wannabe Corths you were charging mid-range prices. This tells us that:

A) You were doing well while people were charging less than you
B) Other lawyers were doing well while charging more than you
C) Competition was not motivating you to change your price
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Re: Medical Lawsuits

Postby kiryan » Tue Mar 10, 2009 11:32 pm

and its perfectly proper for corth to charge what he does because he is sufficiently busy and has other lines of business. Corth is not selling a single service within a single subset of his industry. if he was a full time in real estate, he might need to get more competitive (on prices and structures that enable him to still profit at the lower end) or go out of business, but he isn't.


There obviously is price collusion to some degree. The movie "A beautiful mind" covered this briefly, the old economic theory was people will do whatever is best for them, his revision was people will do what is best for them and the best for the rest of the pack. This is how we get some price collusion, if oil drops to $10 a barrel its bad for everyone in the industry so they all take actions that prop it up... sometimes in a monopolistic way, sometimes along the economic principle of whats good for the industry.

FYI this is happening right now in crude oil prices. The supply artificially off the market is ginormous, but all the suppliers are acting together to try and offset a complete destruction of the price of a barrel of oil. There may be overt collusion like OPEC, but there is also just a general decision to keep oil off the market to try and support a "reasonable" price. At $10 a barrel of oil, everyone gets destroyed, the industry now, the consumer in the future.
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Re: Medical Lawsuits

Postby Corth » Tue Mar 10, 2009 11:42 pm

Sarvis wrote:
A) You were doing well while people were charging less than you
B) Other lawyers were doing well while charging more than you
C) Competition was not motivating you to change your price


A) Yes - but I was not doing these cases in volume. Others would charge less and do a lot more cases because they were better geared towards that sort of business. I was able to charge more because of relationships with the clients and referrals from former client and real estate brokers who knew what a good job I did. Still, I wasn't able to charge even more for my services (which I would have loved to do) or I risked losing too much business.

B) Yes - mostly lawyers who have been in business a long time and have repeat clients who trust them and are willing to pay more. But you know what? Even they had to compete to some extent on price. Maybe they could get away with $1,500, but much more than that and I bet they would lose too much business. Its kind of like the difference between buying a noname plasma TV or a panasonic. If panasonics get too expensive, perhaps you go for the cheap noname. But if the panasonic isn't that much more than the noname, then you go with the panasonic.

C) I compete on price every single day. In the RE context, competition kept my price at $1,000 rather than $1,500. At the time I would have lost a lot of business if I charged that much, and i preferred to keep getting the amount of business I was getting. I still charge $1,000 but now I get a lot less RE business because competition has caused the price of that particular service to fall severely as people are charging only $400 or $500 on craigslist. I can't compete with that, and I don't even try. Competition has effectively put me out of the RE closing business.

Look, you don't believe competition exists and that is your right. I think you are just being ridiculously stubborn. Both you and I know that when you, Sarvis, go to buy something, you look to pay as little as possible. Be it a high end computer part, which by the way, is an uber-competitive retail environment, or an automobile, or even dinner at a restaurant. You aren't made out of money, and you make decisions based upon the relative costs of an item or service. You are just making yourself look stubborn and overly politicized by refusing to acknowledge the existence of competition in setting prices.
Having said all that, the situation has been handled, so this thread is pretty much at an end. -Kossuth



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Re: Medical Lawsuits

Postby Sarvis » Wed Mar 11, 2009 12:02 am

Corth wrote:
Sarvis wrote:
A) You were doing well while people were charging less than you
B) Other lawyers were doing well while charging more than you
C) Competition was not motivating you to change your price


A) Yes - but I was not doing these cases in volume. Others would charge less and do a lot more cases because they were better geared towards that sort of business. I was able to charge more because of relationships with the clients and referrals from former client and real estate brokers who knew what a good job I did. Still, I wasn't able to charge even more for my services (which I would have loved to do) or I risked losing too much business.

B) Yes - mostly lawyers who have been in business a long time and have repeat clients who trust them and are willing to pay more. But you know what? Even they had to compete to some extent on price. Maybe they could get away with $1,500, but much more than that and I bet they would lose too much business. Its kind of like the difference between buying a noname plasma TV or a panasonic. If panasonics get too expensive, perhaps you go for the cheap noname. But if the panasonic isn't that much more than the noname, then you go with the panasonic.

C) I compete on price every single day. In the RE context, competition kept my price at $1,000 rather than $1,500. At the time I would have lost a lot of business if I charged that much, and i preferred to keep getting the amount of business I was getting. I still charge $1,000 but now I get a lot less RE business because competition has caused the price of that particular service to fall severely as people are charging only $400 or $500 on craigslist. I can't compete with that, and I don't even try. Competition has effectively put me out of the RE closing business.

Look, you don't believe competition exists and that is your right. I think you are just being ridiculously stubborn. Both you and I know that when you, Sarvis, go to buy something, you look to pay as little as possible.


Right, remind me again where competition was a big factor in A or B? You said yourself you charged more than some lawyers because you were not geared to handle the volume of RE business they were. That is not a competition decision, that is a process decision. Had competition been the driving factor, you would have found a way to compete on price.

Look, you're not going to compete past a price that's profitable... and if you can be more profitable at a higher price then it's very likely your competition can be as well. There is no reason to engage in a price war, it only causes you to spend more time/effort/money to get a lower profit margin.

Simply put, would you rather have 10 client for $100,000 /year or 100 clients for $10,000/year? I'm betting 10 clients, right? Competing on price will net you the second situation. You know it, and your competitors know it. That's why the guys who charge more than you compete on name recognition and long standing relationships rather than price.

This is why firms spend money on advertising, isn't it? Come on Corth, you can cut your price $100, or spend $100/existing client/month on ads. Which are you going to choose? Which do you really think will get you more clients? I'm betting it's not price chopping.

Be it a high end computer part, which by the way, is an uber-competitive retail environment, or an automobile, or even dinner at a restaurant. You aren't made out of money, and you make decisions based upon the relative costs of an item or service. You are just making yourself look stubborn and overly politicized by refusing to acknowledge the existence of competition in setting prices.


If the computer part retail market is so uber-competitive then why do stores like Best Buy charge so much more than online retailers do? Dinner at a restaurant? You're kidding right? If that were true no one would eat anywhere but McDonald's, Burger King or Taco Bell. The fact is many people go to expensive restaurants, and they go to the ones they like regardless of price. If the price at a restaurant someone likes is too high, they simply go less often... but they don't switch to a restaurant with disliked food because it's cheaper.

Restaurants, computer part retailers, auto-dealers, lawyers, even Corths compete on tons of things other than price... because price is not a very smart thing to compete on.
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Re: Medical Lawsuits

Postby Corth » Wed Mar 11, 2009 12:15 am

Sarvis,

I never said price is the only basis for competition. Hence my example with Panasonic vs. noname brand. Competing on quality is perfectly legitimate and again creates a net benefit for the consumer. But everyone, to some extent, competes on price. Look, Peter Luger's costs a whole lot more than McDonalds.. perhaps 30x as much for a meal. But they don't charge much more than a restaurant with similar quality food. If they did, they would lose business. Simple as that. Likewise, if Panasonic charged much more than Sony, then Sony would take a greater market share. If the Chevrolet midsized sedan is much more than a similar model put out by Toyota, then the chevy will get crushed. Again and again, ad nauseum we can spew out examples.

Maybe you should tell me why online retailers charge so much less than Best Buy. Seems you are making my point for me.

You still won't admit that you take price into account when you make everyday decision with your money. Pretty funny at this point actually.

Anyway, this is my last post on the subject. Its kind of like trying to convince somebody that gravity exists. Gets pretty old fast.
Having said all that, the situation has been handled, so this thread is pretty much at an end. -Kossuth



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Re: Medical Lawsuits

Postby Sarvis » Wed Mar 11, 2009 12:45 am

Corth wrote:Anyway, this is my last post on the subject. Its kind of like trying to convince somebody that gravity exists. Gets pretty old fast.


The thing is, that's not what you're explaining. You're telling me a ball can ONLY move down because gravity exists.

Yes, I know competition exists. You've just admitted that there are lots of other things to compete on other than price. You've said yourself that you can charge more due to existing relationships and referrals AND that other lawyers can charge even more for the same reasons.

Now let's remember what we're talking about here: Some of us do not expect the insurance companies to lower their prices simply because their costs have come down. You're saying competition will lower the prices, in other words that gravity (competition) can only force the price (ball) down.

The reality is that these insurance companies have the same relationships you do, and can still charge the same amount. In fact, it's probably worse since they are dealing with beauracracies rather than individuals... changing anything can be difficult for a hospital. The price can easily move sideways when these insurance companies can talk about how well they've served in the past, and especially when they realize that the more hospitals they serve the more they have to pay to do so. Much like you not being geared to handle the volume of your cut-rate peers, these insurance companies may not be ready to handle a huge influx of new customers bearing a lower profit margin.

So again, yes competition exists. It's not gravity though, it can do things other than force the ball down.
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