Transcript NEW OPPORTUNITY FOR PRIVATE HEALTH INSURANCE IN …

PUBLIC & PRIVATE HEALTH CARE
IN CANADA
by Norma Kozhaya, Ph.D.
Economist, Montreal Economic Institute
before the
Canadian Pension & Benefits Institute
Winnipeg - June 15, 2007
Possible private contribution
• Possible private contribution in the health
care sector:
– Out-of-pocket financing
– Private insurance
– Private provision of publicly funded services
– PPP
• I will focus more specifically on the role of
private insurance
Context
• Canada is the only OECD country that prohibits
the possibility of private insurance for medically
required services (through provincial legislation).
• Canada is also one of the « biggest spenders »
on health care
• What are the results? Value for our money?
Financial sustainability
• Health care spending accounts for more than 10%
of our GDP (70% public, 30% private)
• With inflation taken into account, per capita public
health care spending doubled in 30 years (CIHI).
Financial sustainability
• More than 33% of total provincial government
revenues are spent on health care
• In Quebec:
44% of provincial program spending goes
toward health care in 2006 compared to 35% in
1990.
Financial sustainability
Factors driving growth:
– Population aging (the share of the elderly in the
population 14% today, 23% in 2026)
– Technology
– New drugs
Growth Projections for Canada: Increase of
4% of GDP by 2040, (CD Howe), 4,2% in 2050,
(OECD)
Cost
Health care spending in OECD countries with universal access as %/GDP (2003, 8th)
Switzerland
Germany
Greece
Iceland
France
Belgium
Norway
Canada
Portugal
Austria
Sweden
Asutralia
Netherlands
Denmark
OECD average
Hungary
Italy
Japan
New Zealand
United Kingdom
Spain
Luxembourg
Czech Republic
Finland
Ireland
Poland
Slovakia
Korea
11,5
10,9
10,5
10,5
10,4
10,1
10,1
9,9
9,8
9,6
9,3
9,2
9,1
8,9
8,7
8,3
8,2
8,0
8,0
7,9
7,9
7,7
7,5
7,4
7,2
6,5
5,9
5,5
0,0
2,0
4,0
6,0
8,0
10,0
12,0
14,0
Cost and results
Different measures of health care system
performance; two are of particular
relevance for Canada:
– Access
– Waiting time
Cost and results
Number of doctors per 1000 inhabitants (24th)
Iceland
Greece
Slovakia
Netherlands
Czech republic
Italy
Belgium
Switzerland
Norway
Austria
Ireland
France
Portugal
Hungary
Sweden
Denmark
Spain
Germany
Australia
Poland
Luxembourg
New Zealand
South Korea
Finland
Canada
United Kingdom
Japan (2002)
Turkey
0,0
4,3
4,2
3,7
3,7
3,7
3,6
3,6
3,5
3,4
3,3
3,2
3,2
3,1
3,1
3,0
3,0
2,9
2,9
2,9
2,8
2,8
2,6
2,5
2,3
2,3
2,1
1,7
1,4
1,0
2,0
3,0
4,0
5,0
Cost and results
Public spending per capita and waiting times in Canada
1993-2005
3000
19
2500
15
13
2000
11
9
1500
7
1000
5
1993
Source: Fraser Institute; Canadian Institute for Health Information
1999
2005
weeks
constant 2005 dollars
17
Private health insurance
• Private health insurance plays varying
roles in OECD countries and fulfills
different functions within health care
systems.
• Five categories of insurance, from the
most comprehensive to those complement
to the public system.
Private health insurance
• Among the five categories of insurance,
only one, supplementary insurance, is
already established in Canada for
uninsured services.
• Three of the other four are unlikely to be
offered, even following the Chaoulli ruling,
because of the legal obstacles that
remain.
Private insurance: new opportunities
Duplicate insurance
• Individuals remain insured with the public
system while paying for the option of being
treated in a parallel private system, with no
commitment of public funds to cover this care
• Exists notably in Finland, Italy, U.-K., Australia,
Ireland
Private insurance: new opportunities
• For greater overall financing.
• For more capacity to treat patients (more beds,
more equipment, more operating rooms, etc.)
• To create more work in the private sector for
existing medical staff, underused in the public
system because of salary caps and quotas.
Private insurance: new opportunities
• To repatriate thousands of doctors and
nurses working abroad.
• Without private insurance, only the
wealthiest Canadians could obtain private
treatment, often outside Canada, paying
directly from their pockets
Other possible private contribution
• User fees (exist in 78% of OECD
countries).
(Need to change the Canada Health Act
eventually)
• Private provision of publicly funded
services (Sweden, France, U.-K.)
Public opinion
65%
52%
42%
33%
6%
1%
YES
CANADA
NO
DON'T KNOW
QUEBEC
Question: Would you find it acceptable or not if the government were to allow those
who wish to pay for healthcare in the private sector to have speedier access to this type
of care while still maintaining the current free and universal healthcare system?
Conclusion
• It’s not part of Canadian values to let
people suffer on waiting lists.
• The private sector does not threaten the
public sector as OECD countries
experience shows.