Bagley on the History of the Regulating Medicine as a Public Utility

Nicholas Bagley (University of Michigan Law School) has posted "Medicine as a Public Calling." It is scheduled to appear in Volume 114 of the Michigan Law Review (forthcoming 2015). Here's the abstract:

The debate over how to tame private medical spending tends to pit advocates of a single-payer approach against those who would prefer to harness market forces to hold down costs. When it is mentioned at all, the possibility of regulating medicine as a public utility is dismissed as a political impossibility — or, worse, as anathema to the American regulatory tradition. Yet there is a rich history in the United States of subjecting private businesses that wield undue power to economic regulation. Growing out of an ancient common law practice of imposing special duties on innkeepers and common carriers, the body of law governing the regulation of “public callings” had evolved by the early twentieth century into a comprehensive challenge to the principles of laissez faire.

The rise of the modern medical industry in the years after the Second World War prompted the enactment of federal and state laws emerging from this tradition and directed at the business of medicine. Although the last two decades of the twentieth century saw many of these laws give way to a resurgent belief that market forces ought to guide the distribution of health-care services, an important strain of the law has always treated modern medicine as a public calling. Now that the Affordable Care Act has eased concerns about the uninsured, a stubborn set of economic problems in the medical industry — supply imbalances, access restrictions, and abusive and discriminatory pricing — may spur renewed interest in laws reflecting the principles of public utility regulation. Indeed, nascent interest in such laws suggests that we may already be heading that direction.

Full text is available here.