It is commonly believed that deliberate, careful price regulation by enlightened technocrats trumps the haphazard and chaotic regulation of prices imposed by the free market—especially when the market is subject to greed and corruption.
A most interesting case study challenging that belief comes courtesy of the largest Democracy in the world: India.
In 2017, an arm of the Indian Government, the National Pharmaceutical Pricing Authority (NPPA) took action to control the price of coronary stents in India by capping their retail price. The problem that stimulated this action was their exorbitant price that made them unaffordable to many Indians.
The retail prices of US made drug-eluting stents ranged from Rs 80,000 – 150,000 (~$1000 – ~$2000), while the price of Indian made drug-eluting stents ranged from Rs 45,000 – 90,000 (~$600 – ~$1200). Considering that a good job for 90% of the Indian labor force pays about Rs 180,000 per year, these prices put most coronary stents out of the reach of a vast swath of the populace.
What regulators knew, however, was that the price point at which coronary stents were being imported into India was a fraction of the price being charged to Indians. The up-charge had everything to do with what happened after the stent was brought onto Indian soil: The Indian subsidiary of the US stent manufacturer would sell its product to a domestic distributor that would then employ all means necessary to ensure their stent was chosen by cardiologists to be implanted.
While spending time in Austin, TX over the holiday break, I finally took the plunge and tried out an electric scooter. Through my Uber app, my phone’s GPS located a suitable vehicle, made me agree to an entirely too long User Agreement and charged my VISA $1.00 for the first five minutes (and $0.15/minute after that).
It was fun. It was economical. It solved my dilemma of how to get around relatively expediently without a car. It was also a potential death trap.
With the capability of reaching up to 20 mph and provided without training, helmets or health insurance, electric scooter companies appear comfortable extolling the virtues of their “disruption” regardless of potential negative health and safety externalities. And it’s not as if these negative effects are merely speculation – though statistical injury data is still sparse given the newness of this type of transportation service, interviews with emergency room physicians show that “[i]njuries are coming fast and furious” with injuries ranging from broken bones, lacerations, blunt head trauma and even death.
The conduct of electric scooter companies betrays the elitist singlemindedness of some of the tech community. When faced with legitimate public health and safety concerns, electric scooter companies haven’t taken a step back and re-examined their approach. Instead, relying on the tried and true appeal to caveat emptor or “buyer beware”, electric scooter companies appear content to download public health and safety risks to other actors, such as their customers, health systems and governments, as long as they keep getting funding and expanding.
Medicare, the Affordable Care Act, and other advances in health coverage have traditionally been driven by political forces on the left. Currently, activists who have done so much to improve access to health care are trying to popularize the slogan that “health care is a right.” The phrase was first popularized by Senator Bernie Sanders in his 2016 presidential campaign and returned for the current election season, picked up by Senators Kirsten Gillibrand, Kamala Harris, and other politicians. The right to health care also shows up in the Green New Deal. These politicians are reviving the ideals in the United Nations’ historic 1948 Universal Declaration of Human Rights, whose Article 25 cites a right to medical care and social services.
As a writer who has covered the health IT space for a decades, and a believer in better health for everyone, I’m more concerned with improving health and making a system that works right than in complicated and problematic terminology. Before we talk about rights, we have to be honest about the difficulties of addressing our dual crisis of worsening health and increasing costs.
And health is definitely a crisis. An aging population across many countries has created large bodies of patients suffering from chronic conditions. In the United States, increasing health care costs have suppressed wage increases, fueling a well-known resentment among working-class and middle-class voters. Miraculous advances in treatments have saved lives but saddled the public with unsustainable costs.