Tag Archives: Dr. Michael Rachlis

10 Insights from the Action Assembly Weekend

“Either I pay taxes or have my mother live with me,” said Neil Brooks with a sly smile. Brooks, co-author of The Trouble With Billionaires (with Linda McQuaig) underlined the value of taxes during the keynote address at this year’s Ontario Health Coalition (OHC) Action Assembly Weekend.

Brooks said that as we shift the line between what’s public and what’s private, the cost to individuals rises as government services become far more expensive to replace privately.

The Action Assembly is the OHC’s annual meeting to plan priorities for the coming year as well as review the victories of the previous one.

November 17-18 the meeting hall at the University of Toronto’s Hart House was packed as health care activists travelled from across the province to meet.

Here are 10 insight moments from this year’s 2-day meeting:

1. Switzerland is a criminal state. Neil Brooks, a tax law professor at Osgoode Law School, said governments have begun to recognize how much money they are losing to tax havens that protect the wealthy from paying their fair share back in their country of residence. It is estimated that $20-$30 trillion is salted away in tax havens, resulting in the loss of billions of dollars to public treasuries. Brooks says more money is leaving Africa for tax havens than all foreign aid coming to the continent.

Neil Brooks, law professor and author.

Neil Brooks, law professor and author.

2. Actor Michael Caine says increasing taxes on the wealthy amounts to government interference. But Brooks suggests that Caine is overlooking the copyright laws passed by the same government that secure his wealth. When it benefits the wealthy, it’s not interference or big government. As top marginal tax rates dramatically decreased in the last 30 years, so did the spread between income growth between the wealthy and the rest of us. Brooks says that with the massive number of films Caine has made, the odds would suggest some of them had to be good.

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Unemployed Docs: You don’t want fries with that

Much has been made of potential doctor shortages resulting from the no-holds barred death match between the Ontario Medical Association and Health Minister Deb Matthews.

It is notable that last year Dr. Sacha Bhatia, the former health advisor to Premier Dalton McGuinty, wrote an essay published on longwoods.com last year that discussed the problems young physicians will soon have finding work.

Bhatia notes a Royal College of Physicians and Surgeons of Canada study that reports graduates in 13 specialities in Canada were having difficulty finding jobs, and another study published in the Annals of Thoracic Surgery that found 34 per cent of cardiac surgery graduates were underemployed.

“There are several factors affecting demand for physicians,” writes Bhatia. “Hospital budget constraints mean less capacity for physicians to operate in. Technology changes, expanded scopes of practice of non-physician specialties, and improvements in efficiency also mean fewer physicians are required to do the same volume of work.”

Bhatia states that these efficiencies should be offset by increased demand resulting from an aging medically complex population.

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Health Systems: Why can’t we be less like the US and more like Denmark?

Compared to the United States, Canada’s health care system appears to be the model of efficiency. The United States continues to be an outlier when it comes to health care. Americans spend a greater percentage of their overall economy on health care than in any other United Nations member state – except for East Timor. And yet many of their key outcome indicators are well below countries that spend far less.

According to international OECD data (Organization for Economic Cooperation and Development), in 2008 Canada spent $4,079 (US) per capita on both private and public health care. The US spent $7,538 (US).

What we often forget in these comparisons is about a third of our health care system is very much like the United States. Most of us do not pull out our OHIP card when we visit the dentist or the pharmacy. When Dalton McGuinty was first elected in 2004, he established a dedicated health care tax that brings in about $3 billion per year. He also delisted physiotherapy, eye exams and chiropractic care. Most now have to pay for these services through private insurance or out-of-pocket. Now we are seeing more Ontarians, tired of waiting for home care services, paying out-of-pocket to get service from the same agencies that are responsible for providing public care. According to the Ontario Home Care Association, 20 million hours – or about 40 per cent of home care – is purchased privately.

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Sustainability panic unwarranted says Rachlis

Dr. Michael Rachlis speaking to the Students For Medicare conference May 28.

Dr. Michael Rachlis wonders about the credibility of the scary health care scenarios painted by former Bank of Canada Governor David Dodge and TD Economics’ Don Drummond.

Dodge and Drummond have authored reports suggesting that health care spending will not be sustainable unless dramatic changes take place.

Speaking to a Students for Medicare conference May 28th, Rachlis questions the ability of Dodge and Drummond to do 20 year projections when “they don’t even have this year right.”

As a percentage of our total economy, public spending is up by 0.6 per cent since the last recession in 1992. Private spending – through private insurance and out-of-pocket health expenditures – is up by 0.9 per cent.

Rachlis has been particularly critical of Dodge, who appears to be deliberately ignoring data from 2010 which shows health care spending in decline relative to the size of the economy.

While Drummond and Dodge have suggested solutions may emerge in greater private involvement, Rachlis says the numbers show that public spending is much more controllable than private.

“In a multi-payer system companies can take advantage of the fact that people will have less purchasing power,” he said.

Looking across Canada, Rachlis says that if Alberta were a country it would be spending less than any other industrialized country in the world.

“Yet they are screaming they don’t have health care sustainability either,” he says.
“In Quebec their spending has remained flat for 30 years, and yet they are subject to the same hysteria.”

Even as a percentage of government program spending, there is little to suggest that health care costs are unsustainable – most of the growth related to a shrinking revenue base through tax cuts. In the early 1990s government spending accounted for 53 per cent of the economy. Just prior to the recession it was below 40 per cent. Government revenues has fallen by 5.4 per cent relative to gross domestic product (GDP) in the last decade, adding up to a loss of $90 billion.

“None of that money has gone to any of you in the room,” he says.

With half that amount we could implement pharmacare, national child care, deliver free university tuition, and still buy the fighter jets.”

“We have made a choice, but not a deliberate choice,” he said.

Both Dodge and Drummond show a sudden surge in their charts where the spending line heads 45 degree upwards, consuming between 70 and 80 per cent of provincial program spending.

Rachlis says he doesn’t understand how they arrive at this figure. Since 2003 spending as a percentage of overall provincial program spending has remained flat at about 39 per cent across Canada.

Rachlis warns that Tony “Huntsville Gazebo” Clement is promising to cut public spending further, even though Canada and the US spend almost equal amounts on public services as a percentage of the size of their economies.

“The Canadian public sector has never been smaller than the American,” he said.

Dispelling the myth that aging will escalate costs, he says aging “is like a glacier, not a tsunami.”

While health care spending is hardly out of control, Rachlis believes there are better ways to organize our present system to make it more effective.

“Our system was designed for acute illness. Our main problem is chronic disease.”

Canada also lags behind most developed countries in advanced electronic health information capacity.

“You grow up with computers and you get to health care and you are dealing with pieces of paper,” he says.

Canada also does badly in after hours care to see a doctor or nurse, and especially long waits to see a specialist.

“The original vision of Tommy Douglas was perfect,” he says. “Due to compromises, we never followed through.”

Rachlis says the solutions are in integrated health care delivery, group medical practice, and democratic governance.

He warns that the present Federal government is intent on getting out of health care altogether, leaving it to the provinces.

The 2004 Health Accord gave very little guidance on how Federal money would be spent, it being about more funding than how the system would be organized.

“If we are prepared to think outside the box, we can fix Medicare through innovation,” he said.

The first stage of Medicare was to eliminate financial barriers. The second stage was meant to deliver services to keep people healthier.

“That’s the real road to sustainability,” he said.