Our Healthcare Dilemma

The growing share of healthcare in federal and provincial budgets is a source of alarm and given the political nature of the issue it is not going to go away. The costs continue to balloon because the population is growing older and new life prolonging drugs and surgical procedures are very expensive. Health care now consumes nearly half of the total expenditures in all provinces and annual increase far exceeds the rate of inflation. Consequently, investments in other necessary items, education and infrastructure for instance, are declining every year. This is unsustainable and measures to contain the costs must be devised and implemented. To make the situation worse, the demand for services exceeds the capacity in the system from primary care physicians to emergency hospital care and patients have a long wait before receiving essential care. Simply put, there are not enough medical professionals to go around. Although more are being trained, the shortage of staff remains acute.

There are two possible solutions to rectify the imbalance in capacity and demand. First, and the preferable one, is to improve the operating efficiency of the system. Instructions on how to achieve higher efficiency levels often come from the top and some serious mistakes have been made. Major studies to determine system wide solutions are necessary and must continue. But we also need small committees of professionals working locally to improve efficiency in their organization which are appropriate for skill levels available to them. The means of implementation and dissemination of the proven techniques, including the financial assistance for new and improved equipment, should be generally accessible without complicated procedures.

Higher efficiency will mitigate but not solve the problem. The other approach, unpleasant at first glance, is reducing the demand. In the long term this can be achieved by improving the dietary habits and encouraging physical fitness. The studies in the United States and New Zealand have shown that the children brought in dysfunctional families are six times more likely to suffer from chronic diseases all their lives starting from childhood. Therefore, effective policies that alleviate poverty, drug addiction, unwanted pregnancies and unemployment and provide job training to men and women living in deprivation can reduce medical care costs by improving the health of children in such families.

Other steps are required till effects of social engineering are felt. The demand can always be reduced by making it unaffordable to some. However, Canadians will rightly find such system abhorrent. A better way may be to provide incentives to reduce or eliminate unnecessary care as well as putting in place some value measures in provision of the care. Are the tests requested by a patient really advisable? What is a stay in extensive care worth in terms of the prolonged life; by a month, a year or ten years? What quality of life would it be after the medical intervention? Rather than making ad hoc decisions we need to have in place a generally applicable protocol. The system should set limits to the extent of care it would provide for specific cases in terms of tests and treatment; giving patients the option to buy the care beyond this limit. Thus, if a test is unnecessary in the doctor’s opinion or a certain treatment, be it drugs or surgery, will extend the life but the quality of life would be poor, patients can receive that care but only by paying for it. Such a system would be labeled a two-tier system and many Canadians would instinctively oppose it. But they might be persuaded if it were explained that the second tier allows all Canadians to receive first class care they need when they need it and a higher tier has always been available to the rich in hospitals and clinics south of the border.

To meet the ever escalating cost, all but the poorest citizens should pay a supplementary tax on income or consumption which is entirely devoted to health care. This tax should cover the healthcare costs above a threshold in the government budget; say 40 percent of general revenue. The rate of this tax can fluctuate based on the anticipated healthcare budget. In order to maintain transparency it is critical that this tax be levied by the healthcare administration and not by the politicians. This system is preferable to a user fee because it will spread the payment over a wide base and will not be disastrous to the family in case of a serious illness.

None of the suggestions proposed here – higher efficiency, elimination of unjustifiable treatments and a supplementary health tax - would be enough by itself and a combination of all three is needed to make the system sustainable. One can only hope that the political will to impose strong measures to solve problems of this magnitude exists.