Tag Archives: health care sustainability

Will health care derail the 2017 target for balancing the books? Not likely.

Picture of coins to illustrate folly of the Conference Board of Canada's health care projections.

The Conference Board suggests that a 4.5 per cent annual increase in health spending will derail plans for a balanced budget in 2017. The thing is, that’s more than double the rate of increase the Wynne government is presently spending on health. (Canstock Photo)

The Conference Board of Canada likes to tell the world that it is independent and unbiased, but a quick look at its board of directors will reveal that it is mostly dominated by leaders from Canada’s corporate sector.

That includes representatives from banking, energy, insurance, and telecommunications, to name but a few of the private sectors chiefs that dominate the board. There are also, for good measure, a handful of board members from the public sector, including two university presidents and one hospital CEO, Michelle DiEmanuele from Trillium Health Partners.

DiEmanuele should be very familiar with what Ontario is spending on health care given Trillium has been subject to the same freeze on base funding that other public hospitals have experienced.

Overall Ontario budgeted for a 2.2 increase in nominal funding for the health care sector in 2014-15. Factor in the present inflation rate of 2.5 per cent (August CPI – Stats Canada), that means health care experienced an overall drop in real inflation-adjusted funding of -0.3 per cent. Add to that the impact of population growth and aging, the real cost pressures are probably closer to 4.5 per cent.

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Poking the beast – “P” word missing from reform talk

The problem with discussing health care sustainability is there is no definition of what that means. Data would suggest that our health care spending is not out of control – the so-called cost curve has already been bent. Past increases appear to have occurred in sync with economic growth, the exception being the economic crash of 2008. Clearly those who are worried about sustainability are not equating it with affordability.

Across Canada the average increase in provincial health care spending this year is 2 per cent – hardly a matter of excess especially when one considers aging and population growth.

While Canada has done better than just about every other country in the OECD in controlling health costs, it has often come at a difference kind of price given quality issues that persist.

This week the Conference Board of Canada is hosting a two-day conference in Toronto on health care sustainability. Next week the discussions will be sure to spill over into the Ontario Hospital Association’s annual get-together at HealthAchieve. We’ll be at both.

Earlier this year health policy analyst Steven Lewis and former Cancer Care Ontario CEO Dr. Terrence Sullivan issued a paper on how to keep the cost curve bent.

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Rachlis tireless in myth-busting around health care sustainability

It’s good to see Dr. Michael Rachlis on the opinion pages of today’s Toronto Star.

Rachlis has been tireless in his myth-busting around the sustainability of health care.

As he points out today, total health care costs as a percentage of the economy have been falling for the last two years. Not only that, but they have also been falling as a percentage of provincial expenditures across Canada. Falling, not rising.

On average, provinces are now spending 38 cents on the dollar for health care, a far cry from the 50 cents or 70 cents that Don Drummond, Brian Mulroney and David Dodge have been projecting to scare Canadians into accepting something less.

Rachlis also states that public reform – not privatization – can go much further to increase access to family doctors, specialists and elective surgeries.

Between 2000 and 2011 Canadian governments (provincial and federal) cut taxes by nearly six per cent of the size of our economy. That means there is $100 billion less to pay for services that Canadians rely on. When Canadians hear that, he says, they are ready for Medicare to cover drugs and continuing care.

“The medical profession, almost all the provinces, and most of the Canadian elite opposed Medicare 50 years ago. Fortunately, the Canadian people strongly supported Medicare then and they still do,” writes Rachlis.

Rachlis will be speaking November 18th at the upcoming Ontario Health Coalition Action Assembly/Conference weekend. He will be joined that day by economist Hugh Mackenzie and Osgoode Hall tax law professor Neil Brooks.

Click here to go to Dr. Michael Rachlis’ website.

Guyatt: Want sustainable health care? Go public

Why is it we celebrate the production of 10,000 SUVs or 10,000 television sets as economic growth but don’t do the same for 10,000 hip replacements?

Dr. Gordon Guyatt points out that there is likely more merit to the hip replacements than the SUVs, yet we are conditioned to think otherwise.

Dr. Gordon Guyatt

Dr. Gordon Guyatt

Public health care is not a drain on the economy, but part of the economy.

Speaking at a “Students for Medicare” conference in Toronto March 31, the McMaster University professor and recent recipient of the Order of Canada made the case that the road to sustainable health care is in publicly funded health care.

Guyatt was critical of the mainstream media who only look at the sustainability of public health care costs, ignoring total health care costs.

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A light bulb turns on – Goar conflicted over evidence on health care spending

When Jim Flaherty was Ontario finance minister, he predicted in 2001 that health care spending would increase to 60 cents on every dollar spent by the Ontario government within five years.

The Tories were then spending 46 cents.

Five years later it was a different government in power at Queen’s Park and Greg Sorbara was Ontario finance minister. Sorbara complained that 45 cents of every dollar was going to health care. He said the government had to get health spending under control.

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$200 billion on health care in 2012? Ridiculous!

Why aren’t we spending $200 billion on public health care in Ontario?

In the early 1990s the straight-line cost projections suggested that by 2012 that’s where our health care spending would be.

Instead we are spending $47 billion – less than 25 per cent of what the “experts” told us would happen.

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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.