What Green Plastic Fingers Prove About Health Care Innovation

Health care isn't a fight between liberals and conservatives; it's between outside innovators and the status quo.

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The battle for the soul of American health care is not really one of Democrat versus Republican or liberal versus conservative. Rather, it is between competing visions we can call the Fortress and the Frontier.

The Fortress is orderly and static — ruled jointly by political and medical aristocracies. The Frontier is chaotic and dynamic, with no permanent ruling class. For 50 years, federal and state policies have pushed health care away from the Frontier and into the Fortress. The Affordable Care Act (ACA, or "Obamacare") is only the latest instance.

[See a collection of political cartoons on Obamacare.]

The Fortress sees answers in the hands of experts and insiders. Well-established politicians, health care professionals and bureaucrats oversee an entrenched health care system. Protection is paramount: protect general hospitals from specialty hospitals, ophthalmologists from optometrists and insurers from math. Above all, protect patients and consumers from their own benighted decisions.  

The Frontier sees answers in the green, plastic fingertips of children. (Explanation to follow!) The Frontier believes elites overestimate the capabilities of insiders and underestimate the abilities of outsiders. Innovation is the imperative. On the Frontier, the key to saving lives and easing pain is to assure that every doctor, insurer, hospital, drug company and device manufacturer quakes in fear that some currently unknown upstart might just put them out of business.

Leon McCarthy is a Massachusetts boy, 12 or 13 years old, born with no fingers on his left hand. Prosthetics are expensive and cumbersome — $20,000 to $30,000, according to Leon's father, Paul. The cost often hits patients in the form of deductibles, copays and annual caps. Paul McCarthy was determined to find a less-expensive alternative. Searching the Internet, he discovered the serendipitous collaboration of Richard Van As, Ivan Owen and Yolandi Dippenaar. In South Africa, Van As, a woodworker, accidentally cut off two fingers and mangled two others. In Bellingham, Wash., Owen, a puppeteer, devised a novel means of manipulating puppets' hands. And Dippenaar, also South African, gave birth to a child, Liam, with no fingers on his dominant right hand.

On the web, Van As saw Owen's work, and the two collaborated to produce inexpensive but workable prosthetics using 3-D printers. Dippenaar caught wind of their work and recruited them to create a hand for 5-year-old Liam — one whose fingers could respond to the movement of muscles in his arm. They did.

[See a collection of political cartoons on the economy.]

Scouring the internet, Paul McCarthy learned of this new technology and found Owen had posted the manufacturing instructions. Using an inexpensive 3-D printer, he and Leon manufactured a hand costing about $5 or $10. With his bright green hand, Leon can pick up pencils, hold a water bottle and ride a bicycle. If he breaks or outgrows it, $10 will buy another.

Even better, says the Frontier, a woodworker, a puppeteer and the families of two disabled children became critical links in an expanding network of tinkerers and inventors. With open-source technologies, network members improve the design of these prosthetics, little by little. It's exactly the process we see with internet apps — strokes of genius from unexpected places. Notice that this process did not come from the titans of medicine, manufacturing, or government — nor would it have. No panel of experts appointed Van As and Owen to develop the green hand. And we'll never know how many tinkerers tried and failed to do something similar.

The Fortress stifles this process. If insurance covered the full cost of high-end prosthetics, who would bother to invent the printed hand? But comprehensive, first-dollar coverage is exactly where the ACA and its predecessor laws are leading. Is the $10 hand as good as the $30,000 model? Perhaps not. But that's the nature of disruptive innovation — a massive cost decrease first, and a massive quality improvement later. Early Apple computers were toys next to the mainframes of the time. But today's iPhone is more powerful than any computer on earth in 1985.

[Read Stan Veuger: How Obamacare Might (Or Might Not) Impact Health Care Innovation]

We appear to be on the verge of 3-D printed hearts, livers and other organs. How might the Fortress impede these developments? Suppose Medicare pays for heart transplants, but not for printed hearts. Or regulators prohibit the implantation of printed hearts because they are initially less likely to succeed than transplanted hearts. Or tort law subjects printed-heart developers to large, arbitrary lawsuits. Or public policy gives financial protection to providers of transplant facilities but not those implanting printed hearts. This is exactly the sort of innovation-stifling control the Affordable Care Act embodies. More power over care in the hands of well-established, self-interested insiders — medical societies, bureaucrats and politicians. But keep in mind, many ACA opponents promote the Fortress as well; they often help protect health care insiders from competition, often at the state level.

The potential collapse of the ACA offers a chance to refight the Fortress-Frontier battle once again. Our lives hang in the balance.

Robert F. Graboyes is a senior research fellow at the Mercatus Center at George Mason University.

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