McGuinty had better prepare to do battle over health care

TheGlobeandMail.com – News/politics – McGuinty had better prepare to do battle over health care
Published on Monday, Nov. 23, 2009.  Last updated on Tuesday, Nov. 24, 2009.   Adam Radwanski

On their way to work each day, Dalton McGuinty and his ministers pass by a series of advertisements extolling the virtues of Ontario’s doctors.

The ads havehad been plastered all around Queen’s Park by the Ontario Medical Association as a rather obvious plea to avoid making health care the province’s next battleground. And in the past, Mr. McGuinty – a Premier who doesn’t like picking fights much with anyone, let alone those in the life-saving business – would surely follow that advice.

But as Mr. McGuinty is fond of reminding his audiences these days, it’s a brave new world we’re living in. And in that world, it’s going to be very hard to avoid a big health-care fight – or, perhaps, several of them.

Mr. McGuinty’s Liberals have a limited number of options to avoid the $24.7-billion deficit turning into a long-term structural one. In this winter’s budget, Finance Minister Dwight Duncan will likely make some flashy moves aimed at demonstrating that the government takes its fiscal challenges seriously – an asset sale, perhaps, or some manner of civil-service trimming, or a spending freeze in most government departments. But those will be primarily short-term measures; they won’t do enough to prevent what could be a growing long-term gap between the government’s expenditures and its revenues.

For the heaviest lifting, there are two choices – collect more taxes, or slow the spending growth in the programs that are chewing up most of the government’s budget.

Nobody around the government will seriously even discuss the prospect of raising taxes; the Liberals believe that would be politically fatal, given the controversy that has already surrounded the health “premium” in their first term and the new harmonized sales tax in their second. (Contrary to popular belief, the HST will not generate extra revenues in the foreseeable future, though the hope is that it will stimulate economic growth that will eventually help the government’s bottom line.)

On the spending side, there simply isn’t all that much room for trimming outside the two biggest ministries – Health and Education.

One could make a case that there’s more natural room for cost-cutting in Education, even though it’s the smaller of the two. Unlike Health, it has neither expensive new technologies nor – outside of the new full-day kindergarten program – a growing number of customers. But that’s not a case Mr. McGuinty, who has fashioned himself an education Premier, would be interested in hearing. Certainly, he’s not about to pick a fight with teachers, whose salaries would offer the main opportunity for belt-tightening.

That leaves health care, which is on pace to take up more than half the government’s program spending by 2015.

Nobody expects total costs to go down. But they also can’t continue to grow by more than 6 per cent annually, let alone whatever might be required to make the system work for aging baby boomers.

If the government is serious about ensuring long-term sustainability, both fiscally and in terms of service delivery, the question isn’t really about whether it will have to fight a health-care battle. It’s on which of three main fronts it will choose to fight it.

Mr. McGuinty’s government has put much of its faith in the integration of hospital services. And in the long run, that’s where the biggest structural changes will have to happen. But it’s stalled, largely because most of the Local Health Integration Networks set up for that are toothless. Trying to quickly ramp it up would require public battles with hospital boards.

The pharmaceuticals industry offers a more inviting target, which has some Liberals clamouring to take it on. But it’s the smallest piece of the puzzle, and the savings that could be reaped from the roughly $4-billion the government spends each year might not suffice on their own.

Somewhere in the middle are the doctors, who last year signed a deal that will give them a fee increase of more than 12 per cent by 2011. The government can’t do much about that now, but it could shift some of the services for which they’re responsible to nurses and other less expensive medical workers.

None of this is the sort of thing Mr. Duncan will be keen to highlight in his budget. But it will be the real story about his government’s efforts to get its finances in order. And whoever winds up on the other side of the battle will be more than happy to tell you about it.

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