Crafting a better health accord

Posted on January 19, 2016 in Health Delivery System – Full Comment
January 18, 2016.   Åke Blomqvist and Colin Busby

Today, provincial and federal health ministers are meeting in Vancouver to negotiate a new health accord. Given the underwhelming results of the previous accord, and the mounting challenges facing today’s provincial health systems, they have their work cut out for them.

Canada’s health-care system ranks in the median on a number of OECD performance measures, but is one of the highest spenders on health care. Similar results emerge from the Commonwealth Fund’s International Health Policy Surveys, in which Canada has, over the last decade, remained well below the average of other developed countries.

Canada’s mediocre rankings seem to be due to the high cost and uneven quality of the care that all provinces are required to pay for under the Canada Health Act (physician and hospital services), and because of the gaps that exist in many provinces’ coverage of things such as prescribed drugs, continuing care for the elderly and mental health.

Past experience suggests that in the discussions over a new health accord, the provinces will say that if the federal government agrees to transfer more money for health, they will take action to address these problems. For a new federal government looking to set a new pattern in federal-provincial relations and to leave its mark on health policy, this could sound like an attractive proposition, but it should be resisted.

The main obstacle preventing substantive health-care reform in Canada is not a lack of money, but the inability of provincial governments to stand up against the various interest groups

The main obstacle preventing substantive health-care reform in Canada is not a lack of money, but the inability of provincial governments to stand up against the various interest groups (including labour groups and private corporations) that want to protect the status quo. If provincial politicians can deflect the blame for their inaction to the federal government, they are less likely to push through reforms that are opposed by these vested interests.

Even if the data on our health system’s performance is not encouraging, promising experiments with methods to improve it are going on in a number of provinces. Rather than imposing national strategies for seniors, drugs and other things, the federal government could play a valuable leadership role by advocating core principles, while encouraging diverse implementation strategies.

When the OECD and Commonwealth Fund results are broken down at the provincial level, some provinces are clearly doing things better than others. Even if one is not able to identify the specific reasons why some do better than others, it is clear that Canadian provinces still have plenty to learn from each other about how health care can be organized and delivered effectively.

There are obvious areas where Ottawa should take on a clear role. For instance, because patent laws are set federally, the federal government should regulate brand name drug prices and participate in bulk purchasing of patented drugs with the provinces. The federal government should help develop a national “basic” formulary, so seriously ill patients would have access to the same medicines wherever they live. It could also take the lead in designing a strategy for how to deal with costly “rare diseases,” in coordinating a response to antibiotic immunity, and in data gathering to reduce the misuse and overuse of certain drugs. These are just a few examples from a long list.

There are many policies that can achieve better value for money, including: changing how we pay doctors, using more per-patient or salary contracts and less fee-for-service; and funding hospitals more for the activities they perform and less lump-sum transfers.

There are also practical ways to re-balance the scope of public coverage in Canadian health care: in particular, by shifting a greater share of available public resources towards drugs, continuing care and mental health, rather than insisting on covering all hospital and doctor costs.

But when it comes to health-care reform, whether in the form of better value for money from doctors and hospitals, or in the form of reduced gaps in coverage, it is the provinces that have to do most of the heavy lifting. The federal government has tools that can animate the discussions and help provinces compare notes on reform efforts, domestically and internationally, but a failure to make provincial systems better should not result in bailouts in the form of increased federal transfers.

National Post

Åke Blomqvist and Colin Busby write on health policy for the C.D. Howe Institute.

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