Transcript Stitches in Time

Canadian Governments Should
Not Encourage more Private
Finance and For Profit Delivery
Canadian Pension and Benefits Institute
Winnipeg June 15, 2007
Michael M. Rachlis MD MSc FRCPC
www.michaelrachlis.com
Outline
• The goals of Canadian Health Policy
are equity and efficiency
• Private finance and for-profit
delivery are incompatible with
equity and efficiency
• We can fix our health system’s
problems without private finance,
for profit delivery, or a lot of new
public money
What are the goals
of Canadian Health
Policy?
British North America Act
“It shall be lawful for the Queen, by
and with the Advice and Consent of
the Senate and House of Commons,
to make Laws for the Peace, Order,
and good Government of Canada…”
Canadian Constitution
Section 36. (1) Without altering the legislative
authority of Parliament or of the provincial
legislatures, or the rights of any of them with respect
to the exercise of their legislative authority,
Parliament and the legislatures, together with the
government of Canada and the provincial
governments, are committed to (a) promoting equal
opportunities for the well-being of Canadians; (b)
furthering economic development to reduce disparity
in opportunities; and (c) providing essential public
services of reasonable quality to all Canadians.
Canada Health Act – “Whereas…
• that Canadians, through their system of
insured health services, have made
outstanding progress in treating sickness
and alleviating the consequences of disease
and disability among all income groups;
• that continued access to quality health care
without financial or other barriers will be
critical to maintaining and improving the
health and well-being of Canadians;”
Canada Health Act – “Whereas…
• AND WHEREAS the Parliament of Canada
wishes to encourage the development of
health services throughout Canada by
assisting the provinces in meeting the costs
thereof;”
From the BNA Act through the
Constitution of 1982 to the Canada
Health Act it is clear that most, but
not all, Canadians value:
• Equitable health care
– Between provinces
– Between different income groups
• Efficient health care
– Good government
Canada at its best: Social Justice and Efficiency
Hon Tommy Douglas
Social Democrat
Justice Emmett Hall
Tory
Outline
• The goals of Canadian Health Policy
are equity and efficiency
• Private finance and for-profit
delivery are incompatible with
equity and efficiency
• We can fix our health system’s
problems without private finance,
for profit delivery, or a lot of new
public money
Private finance is inefficient and
inequitable
• Single payer systems have much lower
administration costs
• Single Payers can keep prices down
• Relying on private finance leads to large
numbers of uninsured
• When people have to pay out of pocket,
the poor are less likely to get needed care
“Hence, the decision which Canadians have to
make…is whether they wish to pay $1.020
million…in 1971 for a programme
administered by the insurance industry, or
$837 million for a programme administered by
government agencies”
“In our opinion it would be…uneconomic…to
spend an extra $193 million. We must chose
the most frugal method.”
Royal Commission on Health Services. 1964.
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96
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98
20
00
20
02
20
04
Percent of GDP
US and Canada HC $ as % of GDP
18
16
14
12
10
8
6
4
2
0
CAN
US
Admininstration as % of Total HC Exp
35%
30%
25%
20%
15%
10%
5%
0%
US
CAN
S Woolhandler Int J H Serv 2004;34:65-78.
Private finance for health care leads
to large numbers of uninsured
• People who are not part of a group often find they
cannot get health insurance at any price
• Private insurers deny coverage to people who are
“poor risks” and are most likely to need care
– No private insurer would have sold Mr. Zeliotis a policy
• One in six Americans have no coverage whatsoever
and tens of millions more have inadequate coverage
• One in two Canadians lacked medical insurance prior
to Medicare
When people have to
pay out of pocket, the
poor are less likely to
get needed care
Access & Income US, Canada, Germany
Did not seek
care because of
cost (below avg
income)
Did not seek
care because of
cost (above avg
income)
0%
10%
20%
30%
40%
50%
K Davis. Commonwealth Fund 2006
For-profit delivery tends to be
more expensive and delivers
poorer outcomes. Therefore, it
is incompatible with efficiency,
which by definition integrates
quality and costs
For profit delivery: In general -higher costs, no better outcomes
• PJ Devereaux et al (CMAJ. 2002;166:1399–
1406. CMAJ 2004;170:1817–1824)
– For profit hospitals had 2% higher death rates
and 20% higher costs
For profit delivery: In general -higher costs, no better outcomes
• PJ Devereaux et al (JAMA. 2002;288: 2449–
2457.)
– For profit dialysis clinics had 8% more deaths
– For-profit clinics had fewer and less trained staff
– For profit clinics dialyzed patients for less time
and used lower doses of erythropoietin
– In the US, 2,000 premature deaths occur every
year among dialysis patients using for-profit
clinics.
Contracting out clinical services
isn’t nearly as easy as the
advocates claim (Deber 2002)
•
•
•
•
•
low contestability
high complexity
low measurability
susceptibility to cream skimming
externalities
Externalities -- Non Profits are
more likely to:
• expend resources on linking different
organizations together to plan community
networks
• engage their communities and enlist
volunteers
• Provide benefits, continuing education,
and training to their staff
Outline
• The goals of Canadian Health Policy
are equity and efficiency
• Private finance and for-profit
delivery are incompatible with
equity and efficiency
• We can fix our health system’s
problems without private finance or
for profit delivery
We could have prevented Medicare’s
problems, but we can fix them!
• Medicare was the right road to take
• The real problem with Medicare is that it
was designed for another time and was
implemented as a compromise
• Costs are not out of control but neither is
the system drastically underfunded
• We can (and are) fixing Medicare's
problems -- The Second Stage of Medicare
Medicare was the right road to take
• Canada & US had same system < 1960
• Now 47 million US uninsured
• Canada spends a lot less than the US but
Canadians get more services
• Canadians live 2 1/2 years longer and
Canada has a 30% lower infant mortality
• Medicare boosts Canadian business
– Health care costs: 1.5% of Canadian
manufacturers’ payroll and 9% of those in US
Medicare was designed for another
time and was a compromise
• We designed our system for acute care,
but now the main problems are chronic
illness
• Douglas originally planned a very
different delivery system
Chronic diseases have
a major impact
• Chronic diseases account for 70% of
all deaths.
• Chronic diseases account for more
than 60% of health care costs.
Our health system has problems
managing chronic disease
• < 30% of Canadians hypertensives have their
blood pressure properly controlled
• 60% of diabetics have gone > 1 yr without an
eye exam or a check for proteinuria
• 60% of asthmatics are not properly controlled
• Up to one in six seniors is re-admitted to
hospital within 30 days of discharge
We could prevent most chronic
diseases
• > 80% of ischemic heart disease, lung
cancer, chronic lung disease, and diabetes
cases could theoretically be prevented
with what we know now
• This would free up over 6000 hospital
beds across Canada
Douglas originally planned a
very different delivery system
• Swift Current Region: A regional authority
model with a public health focus
– The Saskatchewan MDs fought off changes to
the delivery system
– The models that were implemented, e.g. Sault
Ste. Marie Group Health Centre and Saskatoon
Community Clinic, have proved fonts of
innovation
Medicare in the crucible: 1945 and
Swift Current Region #1
• Prepaid funding Services available on a universal
basis, with little or no charge to users.
• Integrated coordination of health care delivery
through the creation of a local integrated health region
which funded a comprehensive service package
• Group medical practice with doctors working in
teams with nurses, social workers and other providers.
• A focus on prevention
• Democratic community governance of health care
delivery by local, elected boards.
Health Care Costs are
not out of Control but
neither is the Health Care
System Drastically
Underfunded
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9
0
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9
0
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8
0
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6
Percent of GDP
US and Canada HC $ as % of GDP
CAN
US
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81
19 –19
83 82
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85 84
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87 86
19 –19
89 88
19 –19
91 90
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93 92
–
19 19
95 94
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97 96
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99 98
20 –20
01 00
20 –20
03 02
20 –2
05 00
–2 4
00
6
f
% GDP
Provincial Health Spending as GDP %
http://secure.cihi.ca/cihiweb/dispPage.jsp?cw_page=media_01nov2006_e
8
7
6
5
4
3
2
1
0
Provincial per capita health spending
(constant 1997 CAN$)
http://secure.cihi.ca/cihiweb/dispPage.jsp?cw_page=media_01nov2006_e
Trend Line
2,500
2,000
1,500
1,000
500
19
75
–1
97
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6
78
–1
97
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9
81
–1
98
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2
84
–1
98
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5
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–1
98
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8
90
–1
99
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93
–1
99
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96
–1
99
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7
99
–2
00
20
0
02
20 –20
03
05
–2
00
6
f
0
Canadian Gov't Budget Expenditures
Federal
Provincial
Total
84
19 - 85
86
19 - 87
88
19 - 89
90
19 - 91
92
19 - 93
94
19 - 95
96
19 - 97
98
20 - 99
00
20 - 01
02
20 - 03
04
-0
5
50
45
40
35
30
25
20
15
10
5
0
19
% of GDP
http://www.fin.gc.ca/toce/2006/frt06_e.html
We can fix Medicare's problems
with the Second Stage of Medicare
“Removing the financial barriers between
the provider of health care and the recipient
is a minor matter, a matter of law, a matter
of taxation. The real problem is how do we
reorganize the health delivery system. We
have a health delivery system that is
lamentably out of date.”
Tommy Douglas
“Only through the practice of preventive
medicine will we keep the costs from
becoming so excessive that the public
will decide that Medicare is not in the
best interests of the people of the
country.”
Tommy Douglas
We Could Have Seamless
Access to All Services
Advanced Access in Ambulatory Care
• Cambridge’s Grandview Medical Centre and
Toronto’s Rexdale and Lawrence Heights CHCs
have gone to same day servicing
• Ten MDs in Penticton and Prince George
• The Saskatoon Community Clinic (20,000 +
patients) went on Advanced Access in 2004.
• Saskatchewan is aiming for 20% of family
practices on AA this year and 100% by 2010
Reducing Waits for Specialty Care
• The Hamilton HSO Mental Health Program
increased access for mental health patients
by 1100% while decreasing referrals to the
psychiatry outpatients’ clinic by 70%.
• Capital Health Edmonton decreased delays
for diabetic education from 8 months to 2
weeks by not insisting patients see a
diabetologist on the first visit to the centre
Reducing waits for diagnosis
• Toronto East General Hospital reduced the
overall time from a suspicious x-ray to
definitive diagnosis of lung cancer from 128
days to 31 day – a reduction of 75%
Reducing waits for treatment
• Alberta Orthopedic pilot project
– From 82 weeks to 11 weeks from
family doctor to arthroplasty
– Cost neutral
Summary:
• Private finance and for-profit delivery are
incompatible with Canadian values of equity
and efficiency
• We can fix our health system’s problems
without private finance, for profit delivery,
or a lot of new public money
• Let’s demand governments and providers
deliver the care we deserve!
“Courage my
Friends, ‘Tis Not
Too Late to Make
a Better World!”
Tommy Douglas
(per Alfred Lord
Tennyson)