Firstly, Scott, thanks for your comment.
The excerpt you cited merely points out that the pricing mechanism works differently for mandatory products. And it does. The point of the article was to better understand pricing, not to argue that we should always get mandatory products for free, nor do I think we should.
There are some products that provide huge benefits to third parties and whose absence causes huge losses to third parties (e.g. disease vaccinations) but neither the athlete’s surgery or the asthma treatment you mentioned fall into that category and I don’t think anything in my column makes the argument that they should be provided at public expense. Sorry if that was unclear.
I wrote an entire column of this pricing gap in classical economic theory here: The Undiscovered Country Beyond Market Theory — Where Classical Pricing Fails
If you’re interested in the topic of pricing you might want to check this out.