It still costs money to run a trial, even when the treatment itself is inexpensive. The people doing the enrolling need to be paid, the biostatisticians need to be paid, the doctors get paid research comp time, etc. It all adds up to a lot of money. A big trial could run into the millions easily. Hospitals operate on margins that are frighteningly low, 1-2% in many cases, if not at a loss. A doctor can't decide to start doing this procedure to patients on their own without a considerable amount of evidence supporting it as a best practice, even if it seems likely that it is better than the current status quo.

So here's the dilemma. A hospital or consortium invests millions of dollars in a treatment that can't be patented, costs nothing to startup, and can be easily replicated by others. So they've made the investment with the return being spread out among all their competitors. It's a losing proposition, even in the case of hospitals or universities that could afford it. There is simply no for-profit enterprise that would engage in it. Maybe a foundation (Kidney Foundation, for example) would be interested, but typically the budgets of the national foundations are pretty paltry compared to NIH. That is the main reason why a foundation might look away; I disagree with the author that it's about sexiness (and I say this with some authority, as I'm fairly heavily involved in the American Heart Association).

Now, if NIH were to fund a project that can't be directly capitalized on, but whose returns would be spread broadly through the economy, that makes sense, because it's you and I who are putting up the money and reaping the rewards. That's a value proposition. Even if it's ideologically untenable to you that the government fund biomedical research, it's still a pragmatic position to take, given that NIH dollars have a real impact on national health spending--by far our biggest outlay. We can talk about spending all day long, but the conversations will amount to nothing if health and military aren't on the table. Funding NIH is a way to reduce health spending, counterintuitive as it may seem.