Another Missed Opportunity to Reform Health Care

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posted May 9, 2008

Although the new action plan for Alberta’s ailing health-care system delivered Wednesday by Ron Liepert, Alberta’s Minister of Health and Wellness, provides little detail about the specific initiatives that will be introduced in coming months, its greater failing is the apparent lack of focus on the underlying structure of the Medicare program.

This means Alberta’s provincial government will once again fail to deal with the main culprit behind Albertans Medicare woes: the policy structure of the Medicare program itself. The inevitable result is that Alberta’s new government will ultimately fail to deliver on their promises of a more efficient, more affordable, and higher quality health system for Albertans.

The new health plan includes initiatives to improve governance and accountability; expand health workforce roles (for pharmacists for example); increase training and recruitment; expand the availability of mental health services; encourage healthier lifestyles; and to develop a program to help Albertans navigate the health system.

Notable by their absence are explicit changes to the core policies that form the structure of the health-care program. While some of these changes might come in the specific initiatives that will be introduced in the coming months, potential signs of the road ahead can be found in the Minister’s claim that the plan will not conflict with the Canada Health Act. In other words, cost sharing for publicly funded services and a private parallel health-care sector are likely off the table.

In essence, while the Minister has not ruled out a greater role for private delivery of publicly funded services in Alberta, it appears that this health reform plan is primarily a tweaking of the status quo rather than one that proposes any fundamental change to the state of affairs in Alberta.

Consider for a moment the state of affairs that has resulted from the government’s steadfast commitment to the status quo: Alberta’s publicly funded health-care program—which accounts for 40 per cent of the province’s operating budget—is the most expensive in Canada (age- and sex-adjusted per capita). And Canada as a whole ranks third in age-adjusted health-care spending as a percentage of GDP among 28 developed nations who maintain universal access health insurance programs.

Despite the high level of expenditures, Canadians, including Albertans, endure relatively poor access to physicians and technology and waiting lists that are among the longest in the developed world.

The problem in Alberta is not money but a lack of those things which our already high level of expenditures should buy. A closer look at how other countries are getting more for less shows that the Minister has ultimately chosen a path that will continue to fail Albertans.

Giving credit where credit is due, the Minister has at least chosen not to rule out one sensible and positive change in Alberta’s health-care system: expanding the private delivery of publicly funded services. Both economic research and international evidence have shown that the competitive private provision of services is more cost-efficient and produces a higher quality of care than the monopolistic and chiefly public provision of services that exists in Alberta.

All of the nations who deliver the very best outcomes from care among universal access nations in the developed world (Australia, Sweden, and Japan) employ private competitive providers in the delivery of publicly funded health care. This is also true in every one of those developed nations that have no waiting lists for medically necessary care (Austria, Belgium, France, Germany, Japan, Luxembourg, and Switzerland).

In other words, all of the developed world’s top performing universal health insurance systems allow private competitive providers to deliver publicly funded health care services.

On the other hand, Albertans should be asking why their Health Minister is not embracing the other core policies that allow top-performing nations to deliver world-class access to health care at a level of spending that is similar to or lower than Canada’s.

These top-performing nations all allow private financing of health care when individuals wish to seek care on their own terms with their own resources. In addition, every one of these top-performers also requires patients to share in the cost of their care. The economic theory and international evidence are clear: a world class health-care program cannot be created without such private competition in financing and appropriate financial incentives.

Mr. Liepert had the chance on Wednesday to set the tone of his tenure with a firm stand for sensible health care reform based on the experiences of the developed world’s most effective and efficient universal access health insurance programs. Instead, Alberta’s new Health Minister has decided to be open to one positive and sensible reform of the health program but seems to have pushed the other core policies that are common among the developed world’s most successful universal access health insurance programs off the table.

In essence, Mr. Liepert seems to have reaffirmed the provincial government’s commitment to delivering poor access to care at a grossly inflated price.

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