Abundance in Healthcare

Battling the anti-supply crowd

There can never be too much of a good thing.

For decades, progressive politics has followed the same playbook: overregulate a market, create artificial scarcity, then claim the free market doesn’t work, which justifies more regulation, which further strangles supply. Housing, healthcare, energy, childcare, education: the mechanism is always the same. Central planners insist that supply is dangerous, competition is wasteful, and new capacity only benefits the rich.

Adam Gaffney’s anti–supply-side piece is a pure modern expression of this worldview. He leans heavily on Roemer’s Law, the idea that more hospital beds automatically induce more healthcare use, and concludes that supply creates its own demand. He argues that new hospitals only open in profitable suburbs, that productivity gains in healthcare are impossible, and that these constraints justify more centralized planning and public ownership.

The problem is that none of this holds up.

Roemer’s “Law” was based on a single hospital in 1960s New York, not a universal economic principle. Modern evidence is far less convincing: many regions with surplus beds have low utilization, and capacity expansions often shift care to lower-cost settings rather than increasing total use. If Roemer’s Law actually governed healthcare, rural hospitals with empty beds wouldn’t be going bankrupt.

Meanwhile, states that limit supply through Certificate of Need (CON) laws consistently have higher prices and fewer competing facilities. The Department of Justice recognized that these laws raise costs and reduce access to care. Montana repealed its CON law in 2021, and within 18 months saw rapid growth of outpatient surgery capacity and falling commercial prices in competitive markets. That is exactly the opposite of what Gaffney predicts.

The claim that new hospitals only open in wealthy areas is simply the healthcare version of “new housing only benefits the rich.” It ignores purchasing power. Grocery stores follow SNAP dollars. Childcare centers follow voucher dollars. Hospitals would follow patients too if underserved communities carried real, portable purchasing power rather than being trapped in a centrally planned reimbursement structure. A new specialty hospital in a wealthy suburb doesn’t hurt the safety-net hospital downtown. It offloads cases and frees capacity.

Progressives made the same wrong arguments about airlines, telecommunications, and energy in the 1970s. They insisted markets couldn’t possibly work in sectors with high fixed costs and essential services. Deregulation proved them wrong every time. Prices fell, innovation accelerated, and access expanded.

Healthcare is no different. Artificial scarcity through CON laws, bans on physician-owned hospitals, facility-fee distortions, and centrally administered prices creates high costs and long waits. Scarcity is not a natural state of American healthcare. It is designed. It is legislated. Incumbents weaponize bureaucracy to protect their turf, just as homeowners weaponize zoning.

To their credit, a new movement on the left sees this clearly. Well, they see it clearly at least outside healthcare. The Abundance crowd (Ezra Klein, Matt Yglesias, Armand Domalewski) is pushing back against scarcity politics in housing, transit, energy, and permitting. They’ve begun rediscovering what classical liberals have known all along: when you stop blocking supply, people’s lives get better.

Unfortunately, the Abundance Left stops short when it comes to healthcare. They’ve dismantled the intellectual foundations of Gaffney’s worldview and they just haven’t realized it yet.

So let’s apply their housing logic to healthcare.

If you want to eliminate zoning barriers, you should want to eliminate Certificate of Need laws.
If you want to speed up housing permits, you should want to allow physicians to build hospitals without begging a competitor for permission.
If you want abundant apartments, you should want abundant ambulatory surgery centers.
If you want cheap housing, you should want cheap MRI centers.
If you want to break NIMBY power, you should want to break hospital monopolies.

Gaffney’s argument is structurally identical to the NIMBY argument against building new apartments. It assumes scarcity is inevitable, distrusts markets, and disguises incumbent protection behind the language of equity.

We don’t need more artificial scarcity in healthcare any more than we need it in housing. We need more ASCs offering cheaper surgical procedures with shorter wait times. We need more cash-based imaging centers offering MRIs at a 95% discount to hospitals. We need fewer bureaucratic choke points and more innovation. And yes, we need targeted demand-side subsidies that give underserved patients real purchasing power instead of hoping that planners will guess where supply should go.

If the Abundance movement wants to be intellectually consistent, it should embrace abundance in healthcare too.