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Star Editorial: Finding money to fix medicare

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afransen TO

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Finding money to fix medicare


CAROL GOAR

Health care tops every poll when Canadians are asked to rank their political priorities. But pollsters seldom ask people what they are prepared to give up to accommodate an ever-expanding medical budget.

That is the question bedevilling the nation's political leaders.

Some, such as Alberta Premier Ralph Klein, are raising it openly and aggressively. Others, such as Prime Minister Paul Martin, are pondering it quietly.

Ottawa and the provinces spent $85 billion on medicare last year. It was the sixth consecutive year in which health expenditures rose by 7 per cent, outstripping economic growth and starving other government programs.

Yet still the premiers are warning that medicare will not survive the decade without more federal funds; still the Canadian Medical Association is predicting a worsening shortage of doctors, nurses and hospital beds; and still patients are complaining that they have to wait too long for treatment.

Roy Romanow assured Canadians 16 months ago that medicare was sustainable.

The former health commissioner said Ottawa would have to add $15 billion to the system by 2006, then raise its yearly contribution by $6.5 billion. But he foresaw no difficulty, given that the finance department was projecting a string of healthy surpluses.

There were difficulties, of course:

The finance department's rosy forecast fell victim to SARS, mad cow disease, a spate of natural disasters and a rapidly appreciating dollar.

The provinces, desperate for funds, ignored Romanow's appeal to invest in change and used their new federal money to pay their operating bills.

The federal government engaged in its old game of underestimating the surplus, angering the premiers and setting off a new round of recriminations.

So once again taxpayers find themselves caught between battling governments, watching their health-care system deteriorate.

The reforms Romanow recommended — round-the-clock teams of health-care professionals, improved home care, bulk buying of prescription drugs and clear performance standards — still make sense.

But his plan to pay for them — relying on Ottawa's future surpluses — doesn't.

It makes no allowance for the possibility of an economic downturn. It provides no relief from intergovernmental wrangling. And it gives medicare first claim on every unallocated dollar, crowding out other priorities.

That is why federal officials are seriously considering the possibility of a national health-care premium.

The idea was advanced by a Senate committee a year-and-a-half ago, but ignored by the government.

The 11-member committee, headed by Michael Kirby, proposed that Ottawa raise $5 billion a year through a "variable national health-care insurance premium" based on an individual's ability to pay. The money would go into a special account, dedicated strictly to fixing medicare. It would be overseen by an independent health commissioner, advised by a 10-member council.

Almost no one liked the plan at the time. The right slammed Kirby for recommending a tax increase. The left accused him of raising money in a regressive way. Fellow Liberals saw no value in a large pool of cash they couldn't touch. The final blow came when Romanow declared that medicare could be financed out of existing revenues.

But that was three federal-provincial skirmishes and $29 billion in spending promises ago. The optimism engendered by Romanow's report has dissipated. And 9.8 million baby boomers will soon stretch the health-care system to its limits.

Kirby still thinks a national health-care premium is the answer. "It's the only way to buy change. We'll never get reform by dumping money into the existing system."

Senior officials in Martin's government are coming around to that view. They see no benefit in continually boosting provincial health-care transfers to preserve an unacceptable status quo. They see no advantage in spending more to achieve less.

A national health-care premium offers a way out of this conundrum. It allows Ottawa to create a pool of cash earmarked solely for restructuring the medical system. It guarantees that health-care reform will go ahead, regardless of economic conditions. And it places $5 billion a year beyond the reach of squabbling politicians.

They will continue to squabble, no matter what arrangements are made.

With an aging population and ever-more-sophisticated medical technology, the pressure to increase health-care spending will be relentless. Ottawa will never provide enough cash to satisfy the provinces and they will never be sufficiently biddable to satisfy Ottawa.

But it would be a relief to know that, despite the cacophony, progress was being made. It would be reassuring to think that, beneath the jurisdictional battles, one stream of revenue was flowing directly into health-care improvements.

If asked, most Canadians wouldn't be eager to pay for more medicare. But if the options were longer waits for treatment or worse schools for their children, they might want to reconsider.
 
Premiums are a bad idea because they are regressive. I'd say either use existing revenues, and divert funds for the restructuring of health care from the surplus (budget for it...) or raise income or excise taxes for it. Cars cause a lot of health problems. What a great excuse to raise gas taxes by 2 or 3 cents and dedicate the funds to health care reform. Say it's for health care, and the electorate will forgive them a minor increase in gas prices.

Primary health care is something that needs to be implemented. Its really unfortunate that the doctors have such a strong union. They are stronger than even the teachers.... It would increase quality of service considerably while cutting costs. Nurse practitioners will be necessary in the future simply because we won't have enough doctors.
 
Wasn't a dedicated account supposed to be what happened with EI funds? And the GST?

Why can't the provinces fund health care out of their own taxes?

Kevin
 
Because they're too busy cutting taxes, lol. The provinces would have enough for health care right now if they hadn't gone on such a tax cutting spree this last decade.
 
.. there is the matter that everybody woudl be out of work, however.
We need to be competative.
The one who capitualtes the most to trans national corporations, wins.
Those who stick to their guns suffer mass unemployment and devestating poverty.

The best thing to do with health care is allow for 100% OHIP paid private health care for MRI's and the like. We allow 100% OHIP paid for private X-rays. For no good reason, the same cannot be said about MRIs.
 
The best thing to do with health care is allow for 100% OHIP paid private health care for MRI's and the like. We allow 100% OHIP paid for private X-rays. For no good reason, the same cannot be said about MRIs.

I don't understand how this will help give OHIP additional funds to pay for things like MRIs and X-Rays that people need.

Do you have pricing availble for the cost of a public and private services in these items (include administrative overhead of actually paying the bill).
 
To my understanding, OHIP pays X$ for X-rays, regardless of whether the radio- medicine/ Xrays clinic is private or in a hospital. The money that goes to a private Xrays clinic, such as the kind you find in the basement of any medical arts building (next to the privately run blood lab) is based on a fixed per/X ray cost and is not different, to my understanding, than what a hospital would receive.

A private clinic, unlike a public hospital, has the costs of setting up shop borne by the investors. Conversely, a pubic hospital has the cost of setting up shop borne by the taxpayer. In each circomstance, the taxpayer pays for the service, through OHIP.

OHIP has, I believe, a set fee for MRI's and CAT scans. MRI's and CAT scan machines are loopy expensive. By having private enterprise pick up the tab tab for these machines, governments have more money for subways, tax breaks, education, debt repayment, anything under the sun , etc.
 
Yes, Are Be. Everyone would be out of work. Of course. Our economy would be shut down, and we'd all be huddled in cardboard boxes trying to make fire.

Either you are stupid or you're telling us we're stupid for believing you.
 
MRI scanners are very expensive and very sophisticated pieces of equipment. However, they can be vital in serious medical emergencies. That said, I can't understand why the private sector should run these equipment. It means that the equipment is outside of hospital buildings in private centres. Therefore, public access to these machines is needlessly limited, especially in emergencies. Then there are the costs and complications of transporting inpatients in hospitals to private clinics.

No thank you. The public sector works well enough.
 
To my understanding...

That doesn't make any sense to me. If company X invests in company Y to setup equipment Z, then company X is going to want their money back plus some. This means company Y has to charge government A enough to pay company X.

Since the charge government A incurs include the costs of running the equipment and the profits of both company X and company Y, it is not cheaper in the long run.

It's a bit like saying that renting a condo that someone else has bought, covering their mortgauge and expenses is cheaper than buying the place yourself.

The only way it can be cheaper is through high volume or administrative efficiencies. Ontario healthcare has very low administrative overhead (~3% last I heard) and no private company would do more MRIs than ye 'old hospital.

XRays I can somewhat understand. They're useful for a number of tasks outside of the medical profession.


In theory, they could do things they way Laser Eye surgery shops started up. Owner buys equipment with investors money, goes bankrupt and sells company to newly incorporated company (for pennies on the dollar), which then goes bankrupt. Rinse and repeat.

After enough bankruptcies the equipment actually costs very little, and the companies can now make a profit. I think you would be hard pressed to fools the investors like that with old technology though. Laser Eye surgery was glitzy at the time.
 
Why ought we continue to forbid private radio medicine clinics, such as those that provide Ray services outside of a hospital (and often have blood labs and cardiograph machinery as well) from providing CAT scans and MRI's?
The government regulatory framework is there.
There are willing investors.
If you own the building already, and have staff set up to deal with X- rays, blood work, and cardiograph, then the synergy's are there for CAT scans and MRI's.

(by the way, this is EXACTLY the kind of right wing stuff that the Liberals can get away with, and it is probably something that many Liberals agree with. I hope they take adavatgae of their ability to do what needs to be done and to get away with it.)
 
Those who stick to their guns suffer mass unemployment and devestating poverty.

Yeah right, like Scandinavian countries which come out at the top of every competitiveness list out there despite their high tax rates. Pray tell, why are Tennessee and Arkansas, both with very high taxes, not the new hubs of international commerce?

This is one of Paul Krugman's columns in the New York Times. He is considered one of the most prominent economists in the world today and is considered a very likely candidate for the Nobel prize.

The Health of Nations

According to a recent Gallup poll, 82 percent of Americans rank health care among their top issues. People are happy with the quality of health care, if they can afford it, but they're afraid that they might not be able to afford it. Unlike other wealthy countries, America doesn't have universal health insurance, and it's all too easy to fall through the cracks in our system. When I saw that the president's economic report devoted a whole chapter to health care, I assumed that it would make some attempt to address these public concerns.

Instead, the report pooh-poohs the problem. Although more than 40 million people lack health insurance, this doesn't matter too much because "the uninsured are a diverse and perpetually changing group." This is good news? At any given time about one in seven Americans is uninsured, which is bad enough. Because the uninsured are a "perpetually changing group," however, a much larger fraction of the population suffers periodic, terrifying spells of being uninsured, and an even larger fraction lives with the fear of losing insurance if anything goes wrong at work or at home.

The report also seems to have missed the point of health insurance. It argues that it would be a good thing if insurance companies had more information about the health prospects of clients so "policies could be tailored to different types and priced accordingly." So if insurance companies develop a new way to identify people who are likely to have kidney problems later in life, and use this information to deny such people policies that cover dialysis, that's a positive step?

Having brushed off the plight of those who, for economic or health reasons, cannot get insurance, the report turns to a criticism of health insurance in general, which it blames for excessive health care spending.

Is this really the crucial issue? It's true that the U.S. spends far more on health care than any other country, but this wouldn't be a bad thing if the spending got results. The real question is why, despite all that spending, many Americans aren't assured of the health care they need, and American life expectancy is near the bottom for advanced countries.

Where is the money going? A lot of it goes to overhead. A recent study found that private insurance companies spend 11.7 cents of every health care dollar on administrative costs, mainly advertising and underwriting, compared with 3.6 cents for Medicare and 1.3 cents for Canada's government-run system. Also, our system is very generous to drug companies and other medical suppliers, because — unlike other countries' systems — it doesn't bargain for lower prices.

The result is that American health care, which at its best is the best in the world, offers much of the population a worst-of-all-worlds combination of insecurity and high costs. And that combination is getting worse: insurance premiums are rising, and companies are becoming increasingly unwilling to offer insurance to their employees.

What would an answer to the growing health care crisis look like? It would surely involve extending coverage to those now uninsured. To keep costs down, it would crack down both on drug prices and on administrative costs. And it might well cut private insurance companies out of the loop for some, if not all, coverage.

But the administration can't offer such an answer, both because of its ideological blinders and because of its special interest ties. The Economic Report of the President has only negative things to say about efforts to hold down drug prices. It talks at length about insurance reform, but it mainly complains that we rely too much on insurance; it says nothing about either expanding coverage or reducing insurance-company overhead. Its main concrete policy suggestion is a plan for tax-deductible health savings accounts, which would be worth little or nothing to a vast majority of the uninsured.

I'll talk more about alternatives for health care in future columns. But for now, let's just note that this is an issue the public cares about — an issue the administration can't address, but a bold Democrat can.

Originally published in The New York Times, 2.17.04
 
You shouldn't challenge Are Be's logic... after all, a highly productive, efficient and wealthy economy existing in a high tax environment is TOO EUROPEAN!!!
 
OHIP would still pay, and administer payment.
Why should we forbid MRI machines next to X -ray machines outside of hospitals (and thus in 100% OHIP funded private radio medicine clinics)?
 
Because they're more expensive than publicly run systems in virtually every case, and they're just a way to funnel money to government cronies!

In one case of a private firm being allowed to operate hospital MRI machines after hours, the government paid all the maintenance, heating and cleaning costs. The private operator (incidentally a big Tory donor doctor) made a fortune by paying substandard wages with the government paying most of the operating cost.

Think about it. How could a private operator possibly operate an MRI machine at a lower cost than the public sector. What are these "private sector efficiencies" really? The private operator has to make a profit. As well, they have to pay taxes. They pay the same amount to purchase the machine, or possibly more since the government could perhaps get a volume discount. The only possible savings in the private sector are lower wages and reduced maintenance. Personally, I'd like the people who are looking after my health to be reasonably well paid and the machine properly maintained.

This privatization is purely ideological, as Ralph Klein proved when he actually suggested they would give up federal funding simply so he can privatize. It's a vast transfer of wealth to government cronies and insurance industry lobbyists.
 

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