This free market innovation in healthcare could help millions
Consider for a moment how much the world has changed over the last century thanks to technological innovation. Imagine trying to explain things that are normal today to someone living in the year 1922. It would be nearly impossible. How might you go about explaining, for example, that people today can easily speak to friends and family on the other side of the world without shouting tremendously loud? Or that inexpensive metal chips can store entire libraries’ worth of information?
Innovation is an infinite wonder. It can achieve things beyond our wildest dreams. By extension, a century into the future, the average person will enjoy new life-enhancing technologies that are inconceivable to us now. Except, of course, if that innovation is interrupted by government.
State interventions in the form of new taxes, excessive regulations, and even outright bans have the potential to stifle innovation, bringing immeasurable costs for future generations who will miss out on the benefits of those advancements.
In a way, that is what we see happening in healthcare. Some countries, such as the U.K., are wedded to nationalized systems whose cost reliably increases year-over-year (with serious economic consequences, which Britain has recently
in spectacular fashion), but which still achieve very poor
in terms of key criteria such as waiting times and survival rates. Meanwhile, in the U.S., the healthcare market is ostensibly freer, but meaningful innovation in the way services are provided is hard to come by.
One rare example of a potentially exciting step forward is the idea of crowdfunding healthcare. Some companies are setting up creative funding
in which members submit their expenses to fellow users and the crowdfunded dollars are then transferred directly into their accounts. This thinking could simplify and expand healthcare access for millions, with the private sector shouldering all of the cost and risk rather than taxpayers having to fork out for some new government-run initiative.
On the one hand, crowdfunding healthcare in this way represents a fresh and bold new initiative that could revolutionize the industry. On the other hand, it is a relatively simple innovation that does not smash through barriers of perception and will not be unexplainable a century into the future. In other words, the bar for healthcare innovation is low, no doubt because of the looming threat that the scythe of gratuitous government intervention could swing at any moment, making investments in new technologies and business models a risky endeavor.
That’s where regulatory sandboxes come in. A regulatory sandbox is a space in which entrepreneurs can explore the possibilities of developing their products and services free of obstructive regulatory intervention from government (save for a few fundamental rules, such as basic consumer protections). It provides an avenue for market-skeptical lawmakers to allow innovation to take flight without taking broader, riskier steps such as deregulating entire industries.
When the market is free, there is no ceiling on what we can achieve to make people’s lives better. We ought to strive to innovate in industries such as healthcare at such a pace that within a few decades, they will be unrecognizably better than they are today. Crowdfunding healthcare represents a potential small step forward, but there is infinitely more we could do — if only government could assure would-be investors and entrepreneurs that it would allow them to do their thing and resist the temptation to step in and spoil the party. Regulatory sandboxes might be the best way to make that happen in the immediate future.
Jason Reed (
) is the spokesman at Young Voices and a writer and broadcaster on politics and policy for a wide range of outlets.
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