New York City Mayor Bill de Blasio and New York State Governor Andrew Cuomo are currently at loggerheads over vaccine allocation in the city. The governor has only approved for the vaccine to be given to the first prioritized groups: healthcare workers in hospitals, urgent care providers, and nursing home residents and staff. New York City Mayor De Blasio believes that the city should be given authority to broaden eligibility further, and that if given that authority, they could already be vaccinating many more New Yorkers, including the over‐75 demographic at highest personal risk from the virus.
Yet Cuomo is refusing to relent, despite New York City officials being adamant that, using current eligibility criterion, vaccines sit in storage or are going to waste. As my colleague Jeff Singer explained this week, a lot of healthcare workers either have immunity from the disease already or do not want the vaccine. The restrictions mean some doses are having to be transported out of the city. This follows stories from earlier in the week that claim some public and private New York hospitals had used just 15 percent of their vaccine allocation.
Given vaccines are widely regarded as being in short supply relative to demand, that sounds baffling. One would think that if those eligible priority groups were not filling slots, providers would be seeking out other people to ensure that either appointment times or the vaccine doses themselves do not go to waste. Vaccinating anyone still susceptible to the disease has a public benefit by (at a minimum) reducing the chances of severe disease for the recipient.
Allowing pharmacists and providers to allocate spare vaccines to avoid waste is what economists call a Pareto improvement—a situation where nobody would be harmed but someone would benefit. That makes society better off. If the vaccine reduces transmission of the virus too, an additional inoculation makes everyone better off! HHS Secretary Alex Azar understands this. He warned states last week to not let “perfection be the enemy of the good” in rolling out the vaccine. Getting it in as many arms as possible was preferable to sticking rigidly to the recommended rollout prioritization, he said.
Here in DC, pharmacies have seen sense in regard to mitigating some of the waste associated with a centrally planned vaccine allocation like New York’s. Pharmacies have been vaccinating people from waitlists, or those in stores, if eligible healthcare workers fail to show up, or vaccines would otherwise be binned after vials are opened. I saw it with my own eyes a few nights ago, when a supermarket pharmacy announced that they had 4 vaccine doses remaining at closing time. The pharmacist opted to give them to the front two people in a line of about 20, and to two very elderly shoppers whom he identified as being more at risk from the virus.
Yesterday, I popped back towards closing time and was administered one of Moderna’s vaccines myself. I would have left the wait line if there had only been a few left, given an elderly couple were stood behind me. But owing to the violence on Wednesday in DC and the subsequent cancelled appointments due to the city’s curfew, the pharmacy had 8 spare doses that they said needed to be used yesterday. Better in the arm of someone than nobody. You don’t turn down a free shot.
So why not the application of such decentralized common sense in New York? Well, it doesn’t help that in the name of fairness and avoiding vaccine fraud, Governor Cuomo has claimed that any provider who breaches the state’s distribution plan could be liable for fines up to $1 million, and risk having their license revoked. Economists wouldn’t be surprised to learn that disincentives matter. Meanwhile, millions of elderly New York residents—those at the highest risk from this virus—are unable to be vaccinated by appointment, even as providers say they have spaces and vaccines remain in storage.
It’s impossible to think of a surer way to slow the overall vaccination process for the city than limiting eligibility and then imposing such a high cost on any deviation from it. And this points to an often unacknowledged truth. If you don’t allocate by willingness to pay a price, you must allocate either by letting politicians and bureaucrats decide who will get the good, or by some crude queue or waiting list.
Without the decentralized knowledge of who will want the good and when, allocation by bureaucrat can create either severe shortages or unforgivable waste, not to mention risking the allocation process itself being tainted by cronyism and political favoritism. Allocation by queue biases towards particular groups too. In this case, it favors those with time on their hands, who are able to spot news stories on Twitter and are young and able‐bodied, making them most willing to risk standing in the frozen meat section of a supermarket among shoppers for an hour during an aerosol‐transmitted pandemic.
As should be obvious, the idea that the bureaucratic or queuing methods lead to the allocation best suited to ending this public health crisis seems laughable. New York manages to combine the worst of both worlds—dictating limited eligibility in a heavy‐handed way and then deterring the safety valve of local providers allocating spare vaccines. The question then is not whether any allocation system is perfect. It’s whether a more market‐oriented system would get us closer to our social goals of herd immunity and hospital systems insulated from the risk of overcrowding sooner. It’s difficult not to conclude that, by ignoring basic economics, better outcomes in New York are being sacrificed on the altar of zero‐sum conceptions of fairness or “waiting your turn.”
