By Barak D. Richman and Steven L. Schwarcz
Among the many failures to mitigate the harm from COVID-19 in the U.S. has been the failure to meet surging demand for inpatient care. Hospital bed shortages, overwhelmed intensive care nurses, and scarcities of needed medical equipment have been embarrassing but constant features of the American health care landscape. A nation that spends nearly one out of every six dollars on health care should get much, much more for its money.
Though there is much blame to go around — and many insightful commentators have already allocated culpability — we observe that a significant regulatory deficiency has contributed to the nation’s failure to meet population health needs. This is the failure to regulate our hospitals holistically, as part of a comprehensive health care system.
Existing health care regulation focuses almost exclusively on regulating individual components of the health care industry. This existing regulation lacks the capacity to address how those components work together as a system — a system in which deficiencies in one component adversely impact the performance of the other components. We should not view hospitals as individual providers that treat individual patients. Instead, they are part of a larger safety net that needs to expand capacity when emergencies arise. Today’s pandemic destabilized hospital care because hospitals were neither coordinated nor managed systemically in order to meet population demands.
In Macromedical Regulation, 82 Ohio State Law Journal 727 (2021), we address the nation’s systemic failure to contain an infectious contagion, and we offer solutions by deriving lessons from the 2008 financial contagion. We contend that health care regulation must also include what we call “macromedical” regulation: regulation that focuses on protecting the stability of the health care sector as a system of interconnected parts.