Canada's Health Care System Still Looking Backwards

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posted February 11, 2003

In Canada, it is difficult to have an honest debate about the problems facing the medicare system. After almost forty years of government monopoly health care, the special interests that gain from the current system do everything to stifle discussion. The latest tactic that the government used to hinder reform was to appoint a friendly thought-leader to conduct a national inquiry and churn out a report praising the benefits of government monopoly health care.

Roy Romanow, former Premier of the prairie province of Saskatchewan, delivered a 356 page report that waxes eloquent on the subject of “uniquely Canadian values”, code that suggests support for universal access to health services but actually means forbidding competitors from threatening the government’s monopoly. This report is supposed to inform the health care debate across Canada in the coming months, as the provinces and federal government reassess their responsibilities within the current system. Instead of being a dispassionate examination of medicare, the study was essentially an indictment of the American health care system, while ignoring wider international experience.

Canadian patients wait an average of 16.5 weeks for surgery or cancer therapy, according to The Fraser Institute’s latest survey on hospital waiting times. Furthermore, of 23 OECD countries who report the number of MRIs they have per million residents, Canada ranks 18th; of 22 countries who report CT scanners, Canada ranks 17th; and, for lithotriptors, 13th of 14. A reasonable person would make the connection between the lack of these technologies and the long waiting lists, and conclude that allowing private clinics and hospitals, well stocked with these machines, to compete against the government’s facilities would speed things up.

Not, alas, in Canada. Mr. Romanow might allow going so far as to allow government run hospitals to outsource their laundry services, but that’s about as much as he will tolerate.

Mr. Romanow’s rejection of private hospitals is perhaps forgivable, because his principle source of information is a bewildering article by a top Canadian cardiologist, Dr. Peter Devereaux, and colleagues, published in Canada’s leading medical journal. The article claims that mortality rates in American private for-profit hospitals are worse than in American private not-for-profit hospitals, and thus by extension worse than Canadian hospitals because Canada’s government funded hospitals are technically private not-for-profit.

Even the champions of this fallacious article recognize its flawed methodology. The Dean of the University of Toronto’s Faculty of Medicine wrote that Dr. Devereaux’s study was “flawed methodologically” and used “a tossed salad of patients, institutions, variables, and outcomes”, but that the results were correct anyway!

Because of Mr. Romanow’s poorly informed recommendations, waiting lists for surgery will continue to grow. The $15 million (Cdn.) that the taxpayers invested in Mr. Romanow’s commission could have been used to eliminate the waiting lists for bypass surgery in his home province of Saskatchewan, as well as in Manitoba and Ontario (Canada’s most populous province). However, spending resources on this commission instead of on health care itself is not surprising in Canada. A Fraser Institute study of spending in each of Canada’s provinces between 1993 and 1998 showed that there was no connection between changes in government health spending and changes in waiting times.

Nevertheless, Mr. Romanow wants to increase the government monopoly into areas where it has not yet fully taken hold: care at home and prescription drugs. Mr. Romanow is concerned that there is not a national program that enforces a single standard for homecare. Mr. Romanow’s proposal risks that those suffering will not even be free of government intervention in their homes: that their professional caregivers will be unionized public sector workers, answerable to their union bosses and health department bureaucrats, rather than patients. For prescription drugs, which are heavily subsidized by provincial governments, he proposes that the provinces form a cartel to control costs by rejecting new medicines, a notion similar to some American proposals for a Medicare prescription benefit.

The Canadian experience is instructive for Americans who think more government involvement is the way to reform health care. Government monopoly health care is a runaway train that bounces madly on the tracks but refuses to crash.

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