Minecraft: 1.12.2
Forge: 14.23.5.2806
Railcraft: 12.0.0-beta-2

The middle rail doesn't cause any player damage on any difficulty settings.

Are you sure the track is powered? Each 1 damage takes 1000 points of charge; it there is not enough charge, damage will not be made.

I've got 3 electric locos running on it with an MFE and have 2x (powered)IC2 charge feeder units.
I also tried in a new instance with only Railcraft, IC2 and a few mods like JEI/TOP with default configs. Still doesn't hurt the player in survival even on hard difficulty.

examine the track with a charge meter and see results.

The problem is the system needs enough power stored in the network to zap people. The tracks do two damage (one heart is two damage). It costs 1k charge per point of damage.

So your network needs 2k storage to zap things. The network you have described only has 1k storage.

I know it works, I tested it.