Blogs & Comment

The business of health care reform

The last accord fell short. Should Canadians expect anything different this time around?

(Photo: Troels Graugaard)

With the expiration of the current health care accord looming, fixing our most cherished—and politically charged—social benefit is front and centre again. But as recommendations for health care reform increasingly dominate the airwaves, there’s a frustrating sense of deja vu: many of the problems that were identified last time remain. University of Toronto‘s Colleen Flood, the Canada Research Chair in Health Law and Policy, explains what’s standing in the way of health care reform, and why the business community may be our best bet for bringing about change.

Canadian Business: Discussion about health care reform also ramped up prior to 2004, when the current health care accord was reached. How is this debate different from last time?
Colleen Flood: I don’t think there is anything new under the sun here. In my view it is actually the same issues that we’ve been wrestling with for probably a few decades now. They’re repackaged.

For a while it seemed to have fallen off the radar. I think with the last accord, with the escalator [automatic year-over-year increase in transfer dollars] built in it really sort of dampened down the usual federal-provincial tensions, and for whatever reason it also then fell off the media and public horizon. But it certainly is back on the agenda now, and I think its no coincidence that it’s around the renewal of the accord that you’re starting to see the renewed interest and discussion.

Perhaps the one thing that is new is the emphasis on private for profit delivery which we’ve been seeing. There’s some talk that that may be a condition that the feds actually put on the transfer, the condition of experimenting with private for profit delivery within the context of a public system. I don’t think that’s ever been actually discussed much.

CB:The Liberals were in power when the last agreement was negotiated. What difference will it make to have the Tories at the helm?
CF: There was more of a prospect with the Liberals that they would actually take seriously the notion of trying to drive a national health care system, but they were always reticent to do what was needed for fear of offending provincial sensibilities. So we didn’t get too far other than things like wait times.

With the Conservatives in power, there really is much more of a belief that health care should really be just left to the provinces, and the extent to which the feds are involved if at all is really to support the Canada Health Act through the transfer of funding, but not really to look at whether or not [the act] is actually being fulfilled. It seems clearly true that a lot of the provisions of the Canada Health Act around minimal private financing for medically necessary hospital and physician services has largely in a number of provinces really not been upheld, but this particular cons fed government doesn’t want to go down that path of calling them to account.

I think there’s a big chance that what they’ll do is really just again more of just a transfer of money. Whether or not they would actually go for something more radical, which would be more in the Conservative mould and would be to say, “We want to see some experimentation with private for profit delivery in exchange for the dollars,” that would be the big and interesting question. I don’t really see the conservative government advancing further the kind of spirit of the Canada Health Act in terms of expanding access to services and goods at a national level. Although there have been lots of calls for some sort of national Pharmacare program, I myself don’t actually see myself doing that. That doesn’t seem to be in the ethos or the way that they would approach this.

CB: The last agreement was billed as a “fix for a generation”—which was clearly a bit of an overstatement. What have we learned about the potential for the next agreement to bring about significant change?

CF: On the health care system, [we’re spending] $192 billion annually, so to think you’re just going to find one solution and—boom—it’s all fixed is just utterly naïve. So no, it wasn’t a fix for a generation and neither is likely the next one to be. The one thing you can learn is that simply chucking more money at the health care system is not the solution. Unless you’re really going to use that money to do something that is more transformative in terms of how we deliver, finance and run our health care system, then you’re not going to see any real change.

We have more devices, drugs, services, new innovations that come into our health care system, [yet] we don’t really know how we’re going to deal with them. A lot of them don’t make a great deal of different to our health outcomes, but we’re certainly sold on the view that we need them all. Somewhere into that mix we’ve got to have some clearer thinking about what is and isn’t funded, what do we do with the stuff that we don’t publicly fund. What’s the boundary between public and private? How do we deal with our aging population? We’re also going to have to figure out things like long-term care, which is something that isn’t in the Health Care Act, which is just a huge mess around the country in terms of how we finance it and how we deliver it.

CB: At a panel discussion about health care reform late last month, economist David Dodge told the audience, “It’s going to have to come from us. It’s not going to come from governments.” What do you make of the growing number of panels, think-tanks and influential people–particularly from the business community—that are starting to take the lead on rethinking the financing and management of health care?
CF: I think it’s important that others step up to the plate, and that we have good, ongoing thinking and generation of evidence and ideas to constantly replenish our health care system. The problem with government at the moment is that they have not devolved responsibility or management for the health care system away from central government. This is the biggest governance problem in Canadian health care. It’s just all run very much from the centre, run from the ministries of health, run out of the offices. That means it’s extremely politicized. You see this with deputy ministers—they’re long serving if they’ve been there for two years. Well, how on earth are you meant to run a health care system if your senior leaders are there are the most for a maximum of two years? It’s just silly.

[The reason] we have so many problems in the Canadian system is this problem of accountability. So this is why you’re seeing the private folks coming into the fray here, because over time, a lot of these decisions inevitably come home to roost. One way or another we as Canadians, as businesses, we pay for it. And we certainly wear it in terms of accessibility, quality and safety of our health care system.

CB: But are members of the business community the right people to be making decisions about health care?
CF: In and of themselves, no. But in terms of input to it, of course, we need to hear from the business community. To the extent that government doesn’t step in and do a sufficient job, particularly on things that are currently left outside the public health care system and thus which employers frequently have to cover as part of their employee benefit packages [like] prescription drugs, disability insurance, dental. That affects their bottom line, the way they do business. It also affects their ability to pay their employees real wages, and it affects everybody. So it’s not surprising that they want to get involved and it’s kind of I guess maybe more interesting that they really haven’t up until now.

I’m not sure I would necessarily agree with everything they’re coming up with, but I think it’s really important to have these debates and discussions and to put a fire under our governmental decision makers to sort this stuff out.

CB: In a recent op-ed for the Toronto Star, you wrote, “It is important to remember, as much as we conveniently ignore the fact, that in health care, money spent on one thing simply can’t be spent on another.” The point here is that there are already winners and losers. How can we sit down and start making some of these choices, and how do you see that happening?
CF: Unfortunately I think all those choices are sort of being hidden, they’re choices that are being made right now that we spend more and more on health care and less on education and social supports and all these other things. It’s clearly what they call in economic terms “crowding out.” The expenditures in health care as a proportion of governmental budget is going up and up and up—it’s close to 50% in each province—but total government spending has come down. So what is happening is that health care continues to grow apace but we’re spending less on other things, other areas of potential governmental spending such as education, social supports, housing. So we are definitely making these trade offs.

CB:It sounds like you’re not very optimistic about the potential for change. Is there anything that is giving you hope?
CF: What you said about others coming into the fray and starting to build some momentum about it, I think that does give more hope that this just won’t just be something that is a transfer of dollars from the federal to provincial governments.

A big part of Canada’s international or relative competitiveness with the U.S. is having a relatively robust and universal publicly funded health care system. So it really is in business’s interest to make sure that survives and flourishes. However, without strategic decision making happening now on the part of federal and provincial governments it won’t be there. It just won’t expand and develop in the way that it needs to for things like pharmaceuticals and long-term care.

It is a very positive thing that you see the business community sitting up and asking questions, and particularly with the Conservative government, they’re in fact that right people to be asking these questions. Those of us in academia might say the same things, but I think it’s when the community at large, when the business community is saying, “Hold on. What’s going on here,” I think that can actually really drive some change. So that’s great.

CB: I hope you’re right.
CF: So do I. When you start to think about the next 30 or 40 years, you really want to get it sorted.