Disruption, though painful, can lead to innovation

Published March 19, 2020

By Becki Gray

Most of us can’t remember a time of such widespread disruption. The spread ofcoronavirus has wreaked havoc on the economy, on families, on how and where we work, on how we live and communicate. Our health care system is fragile and stretched.    

The roles of government and private markets, however, are being clarified and, in some cases, re-written.  

As we’ve watched the virus spread, we’ve also watched how leaders respond and residents react. We learned from the outset government has a role, an important one, to protect the public health and safety and to implement measures in emergency situations.    

Some officials and entities do it better than others. Distributing information, allocating money and enacting emergency measures clearly fall under government purview, but we also know government is often slow, inefficient, and bulky.    

Congress approved an $8.5-billion emergency spending package to help curb and slow the spread of coronavirus. Subsequent stimulus packages address economic assistance for hospitals, small businesses, displaced workers, and harmed industries. The president’s declaration of a state of emergency frees billions more.   

The federal government has waived interest payments on student loans. Some Medicare, Medicaid or CHIP requirements are waived. Medications and vaccine trials are on a fast track for approval and distribution to people positive for the coronavirus. Tax deadlines have been extended, aid to small businesses are sped up, and medical research is fast-tracked.   

State government has acted, too. Declaring a state of emergency, Gov. Roy Cooper closed K-12 schools, ordered bars and restaurants to close — except for take-out and delivery — restricted gatherings of people, requested federal money to help small business owners, and eased unemployment benefit requirements for people who are out of work. Most government offices are now virtual, and non-essential state services are suspended.  

Local governments are allocating money and delivering some services virtually to address needs in their communities. Local school boards are getting food to students and providing child-care where needed.  

North Carolina waived certificate-of-need restrictions that capped the number of hospital beds allowed. The governor also waived N.C. license requirements for health care providers with a license from another state, encouraged private labs and universities to expand COVID-19 testing, and allowed more health professionals to conduct testing.  

Telemedicine and telehealth are growing as more people are quarantined and the risk of health care workers contracting the virus grows. This could very well be the future of health care and is clearly a way to increase access to care while relieving the burden on the system, in addition to reducing costs. Taking it a step further, we should allow out-of-state providers to administer care across state lines.   

Schools are closed and parents and teachers are struggling to ensure students don’t fall behind. Students are learning online, and private companies are shoring up connectivity.   

The legislature has authority to appropriate funds as needed. Because of smart fiscal decisions, North Carolina has a substantial amount of money in its rainy day fund and in unreserved cash balance to offer immediate help, additional funding over the coming months, and money for next year, when we may very well face reduced revenue.   

Oftentimes, the best thing government can do is to get out of the way, to either remove restrictions it put in place or to make way for the private sector to step in and do what it does best.   

Local doctors and pharmacists are stepping up to close the COVID-19 testing gap. Private companies are donating tens of millions of dollars for relief and medical efforts. Charter Communications and K-12 are examples of companies and entities that are stepping up, offering free service to students whose parents are new broadband customers. Restaurants are offering free meals to kids out of school. People are buying gift certificates for goods and services they’ll use later to shore up small businesses today. Sports teams and athletes are making sure arena workers are paid.   

NextDoor, a neighborhood networking app, is packed with people offering to run errands, deliver groceries or help with medical visits. People out of work are picking up some money doing chores, babysitting, and helping with home repairs and lawn work.   

But where will we be when the disruption ends, and what lessons will we have learned? We’ll know government has a role, but it’s still too cumbersome and too far removed to do it all. Money distributed to states in block grants rather than expansion of government programs — allowing us to decide where the needs are and how to allocate those resources — is a more effective and cost–efficient way to offer relief and help. State government works best when the executive branch and the legislative branch work together — within their designated authority. Local governments know best about community needs and about ways to meet them.   

Rules and regulations, no matter how well intentioned, often lead to restriction of freedoms, innovation and efficiency. If CON laws are a barrier to access to health care, let’s repeal them. If telemedicine is a better way to provide health care, let’s allow more of it. If qualified medical providers from other states can provide health care in an emergency, why not all the time? Why not extend license reciprocity to all professions? If waivers from federal regulations ensure better health care, why not remove the regulations? If online learning offers more opportunity for students, let’s explore ways to use it even more, and let’s welcome competition between technology innovators and providers in the private sector.  

North Carolina can be a national model for dealing with this crisis. Our government can enact measures to protect public health and safety and provide resources we need while North Carolinians are coming together to help North Carolinians.   

We’ll get through this. When it’s over, they’ll be changes and opportunities to re-evaluate roles of government, the private market and individuals in our everyday lives. Disruption, though painful, can lead to innovation and enhance opportunity. We should embrace it.

Becki Gray is senior vice president of the John Locke Foundation.