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Don’t count on the federal government to fix the ventilator problem | American Enterprise Institute

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The Washington Post argues that the White House should invoke the Defense Production Act (DPA) to fill the shortage of ventilators faced by hospitals hard-hit by the coronavirus. By putting a federal agency in charge of purchasing necessary medical equipment, the Post believes that states would be saved from a “procurement free-for-all” — which apparently means uncertain supply and high prices. Federal control won’t solve the supply problem. It’s likely to be made worse.

This is clear from the way the Strategic National Stockpile (SNS) has been managed during the early stage of the coronavirus crisis. According to the Department of Health and Human Resources, the SNS holds pharmaceuticals and medical supplies for use in a public health emergency severe enough to cause local supplies to run out. 

A ventilator is seen at the New York City Emergency Management Warehouse, where 400 ventilators arrived and before being shipped out for distribution, due to concerns over the rapid spread of coronavirus disease (COVID-19) in the Brooklyn borough of New York City, U.S., March 24, 2020. REUTERS/Caitlin Ochs

In early March, states called on the SNS to release ventilators in preparation for a wave of coronavirus patients. Florida received all the emergency supplies it requested while other states receive only a fraction of their requests.

That might have been reasonable. Some states may have wanted
to create their own stockpiles before an influx of patients while others were
already dealing with a large and growing number who need resource-intensive
treatment. Moreover, federal officials hold back some of their supplies under almost
any circumstance for fear of running out if the crisis is more severe than

But politics plays a role as well. Nicole Lurie ran the Office of Preparedness and Response, which is responsible for the SNS, in the Obama administration. She explained “If a governor jumps up and down and yells and screams, it gets attention… it probably helps to have a really loud megaphone.”

The Post is arguing for federal procurement to create the appearance of an orderly market.  This is a way to ration scarce resources, but it cannot meet the needs of the health sector if our worst fears about the coronavirus epidemic are realized.  For more on this, see my recent article here.

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