Health Care, Wait-lists and Private Benevolence

After waiting almost a year for a specialist appointment, I was able to get into a clinic for a test in one of our local hospitals two weeks later. While I was “on the table”, the doctor discovered that another test was necessary. He promised that he would try to get me in on a cancellation—probably in two weeks. I then received a letter from his office that showed the test has been scheduled in two months! Surgery followed. After an overnight stay, I was sent home with the order to call the doctor and set an appointment within a week. The call to the doctor produced and appointment in five weeks!

While going through the “micro” wait in the hospital (to register, to the department, to the surgery room), I was struck by the amount of “named” facilities—those named for specific donors. The hospital wing was named for a donor, the first waiting room was named for another and even the tiny inner waiting room sported a donor’s name. In Hamilton, we even have a totally newly rebuilt hospital named for its major donor. Now I have nothing against private donors to public or non-profit facilities. In fact, we can only be grateful to these awesome people who help in this way to keep our health care facilities up to date. Without them, some of our government-financed hospitals would no doubt look like the crumbling Champlain bridge in Montreal! However, this visit started me thinking about wait times and private benevolence—after all I had a little time to think!

Government or Market?-Now let’s recognize that basic economics teaches that if something is free, the demand will obviously exceed the supply. Thus, in Canada, where basic health care is free to the patient, obviously there are wait times. The Fraser Institute reported in its 23rd annual edition of Waiting Your Turn: Wait Times for Health Care in Canada that “Canadians are waiting months on average for close to a million medically necessary elective surgeries and diagnostic tests right now”. The 2013 median waiting time of 18.2 weeks was about three days longer than 2012, and substantially longer than 1993 when it was just 9.3 weeks.“Canada is effectively reneging on its promise of universal healthcare for those citizens forced to endure these long waits. Simply putting someone on a list is not the same as providing necessary medical attention in a timely manner,” said Bacchus Barua, Fraser Institute senior health policy analyst and the report’s lead author. In addition to waiting for specialists and for surgery, many Canadians do not even have access to a family doctor and add to pressure on hospital emergency departments (where I recently spent almost a day to get treated for a post-surgery infection!).

In a totally free market (for which I would normally have a preference), actual waiting lists would, at best, be only temporary. The price of a product or procedure would simply go up until the quantity demanded equaled the quantity supplied. Those who could not “buy” at the prevailing price would just not get the procedure. Over time, the higher prices would induce more hospitals or clinics to provide the procedure and attract more doctors to do so. The Christian principle of Neighbour Love would not, however, condone the exclusion of anyone from necessary health care. A totally free market solution is not an option! On the other hand, the current Canadian system—almost totally government financed and controlled health care—has proved itself inadequate to the task—long wait times and ever-increasing need for government funds. If governments simply increased the funding to meet all requests, health care spending would quickly take up a huge portion of all government spending and other things like our crumbling bridges would be further starved for funds.

A New Research Centre Proposal-The prevalence of “named” facilities led me to wonder whether we could somehow harness private donors to not only fund physical facilities but to also direct some funding to researching how best to solve the wait-time problem[1]. Since politicians and bureaucrats have been unable to solve the problem--and it appears to be getting worse—could one or more Canadian private donors not set up and fund a “Research Centre”? The main purpose of such a centre would be to study the causes of the waiting list problem, to publish that research and recommendations for change. It should also actively "market" their recommendations. This centre should be staffed by both medical personnel and economist and other financial experts (and younger research staff to carry out the work). They should, however, be open-minded researchers and exclude ideological adherents to the “universality is a sacred trust” mantra; they should be open to adding market related pieces to the system.

The following possible questions are only an example of those the centre could seek to address:

1. What are the most successful provinces, hospitals and procedure? What can we learn from them? Benchmarking best practices to set achievable goals is a common practice in industry. Recent changes in the Canadian Health accord between the federal government and the provinces are set to allow provinces more flexibility to choose best practices[2]. Perhaps, even fewer federal restrictions would be helpful so that provinces have more incentive to choose alternatives that reduce waiting lists at lowest cost.

2. Which countries have fewer problems with waiting times than us? What can we copy from them? My impression is that countries with more of mixture of government and private practices have less of a problem.

3. Can we not make more use of private health care centres such as Centric Health which was recently profiled in the National Post? In Canada, many provincial governments have been ideologically driven to prevent any additional private treatment. Won’t, letting those who can afford to pay go to alternative clinics, reduce the waiting list for those remaining?[3]

4. How can we achieve more funding at medical schools to allow more students to enter? We know that it is extremely difficult for students to get into Canadian medical schools. Many good students are forced to go abroad or choose different careers. Can higher fees for medical schools with some additional scholarships play a part? Can larger but income-contingent repayment student loan plan be a part? Since doctors achieve relatively high incomes, students would be able to repay these loans out of their future income; those who earn more would repay faster while those with lower incomes would repay slower.

5. Should we have more attractive scholarships and/or loan forgiveness for those who choose those specialties where the need is greatest?

6. How can overall health-care funding be improved? Note that Ontario’s main source of health care funding (other than transfers from the federal government) is a payroll tax. All payroll taxes are, however, “job-killers” since they reduce the ability of businesses to hire workers. Businesses can only hire workers if the financial contribution from the work they do is greater than the cost in wages and related taxes that have to be paid.

7. How can hospitals best be financed e.g. a fixed annual amount or variable amount depending on the output—patients treated, procedures done etc.--or a combination of these? Currently, there appears insufficient motivation for hospitals to work on reducing wait times. In a recent article by Tom Blackwell,[4] a doctor notes that a speedier, “less risky treatment, ‘offers very little advantage’ for its finite annual budget.It’s even a hindrance because the faster you get someone out, the faster you get someone else in, and then they occur new costs”. This shocking quote suggests that some part of hospital funding ought to be related to success in reducing waiting times (although not at the cost of patient health).

These questions are, no doubt, enough to show that there are plenty of questions the proposed new research centre could focus on. Wouldn’t it be nice if some private benefactor(s) could take the initiative and found such a centre?

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[1]  Note, this “thought”. This posting is not the result of a lot of expert research but merely gathering my thoughts as a generalist economic thinker and “customer” of health care.  Perhaps there are already such research facilities available but the problem persists.

[2]  Ake Blomqvist and Colin Busby, “Get Ottawa out of health care”,  National Post, Apr. 14, 2014, p.A12.

[3]  Of course, adequate licensing and supervision of practitioners will have to be in place.

[4]  Tom Blackwell, “Canada lags in less-invasive surgery trend”, National Post, July 30, 2014, p. A6