Inelastic Demand

If the free market worked for health care, the kind of price gouging evidenced by the insane price of EpiPen would not be possible because competitors would emerge to undercut the brand-name price.

There *is*, in fact, a much cheaper alternative, but market forces are clearly not in effect if a drug maker can hike the price of their offering by 400% in six years.

There is a fundamental market distortion that makes health care a terrible candidate for free market capitalism: inelastic demand. 

People who need health care are not consumers–at least, not in any meaningful way. Unlike consumers of other goods and services, people who need health care need it a) immediately and b) can’t risk refusing care, regardless of the cost of that care. 

As we all know, spot prices in markets are incredibly high. Enron gouged the shit out of California between 2000-2001, two years after deregulation opened up spot prices for energy. It bankrupted PG&E, caused state-wide “rolling blackouts”, and put California into a state of emergency.

Markets *don’t* work when demand is inelastic and customers are forced to pay a spot price. 

The risk of not having an EpiPen when you need one is death. There is virtually no price too high for a person facing immanent death to pay to forestall death.

In the case of health care, market forces are inherently distorted beyond the capacity of the market to function properly. We must stop treating health care as an economic market and start treating it as a right.