Medicare is a good system with lax management

Posted on November 12, 2010 in Health Debates

Source: — Authors: – Opinion/EditorialOpinion
Published On Fri Nov 12 2010.   By Carol Goar Editorial Board

Because he refuses to speak in simplistic slogans or dispense glib solutions, Robert Evans is not a media star.

But the 68-year-old Vancouver health economist has a compelling message. Medicare is not about to implode. It is as sustainable as Canadians want it to be, with smart management and proper oversight. It offers governments all the tools they need to curb the growth of health-care spending.

“There is no crisis, no tsunami,” he says. “But there are tough political choices to make.”

Critics of medicare depict Evans as a defender of an obsolete social program. Supporters portray him as a voice of reason in a sea of alarmists. He is neither. He is a rigorous number-cruncher.

His operating premise — based on years of observation and studies from around the world — is that health care will consume as much of any budget it can.

First, he scrutinizes costs exhaustively. When there are spikes or bulges, he looks for the culprits, poring over the financial accounts and health-spending figures to find out where money is going, what it is achieving and who is benefitting.

Then he proposes economically sensible solutions.

The Harvard-trained analyst has been doing this for 32 years as a professor at the University of British Columbia and a consultant to governments at home and abroad. He served on the B.C. Royal Commission on Health Care Costs in 1990-1991. He was a member of the National Forum on Health, chaired by former prime minister Jean Chrétien, from 1994-1997. He is a prolific author and prizewinning researcher. He was appointed an officer of the Order of Canada for his pioneering work.

His latest analysis shows a sharp increase in health-care spending over the last 10 years. Two major cost drivers stand out: drugs and doctors (not profligate hospitals, greying patients or irresponsible consumers).

Initially, Evans was surprised by the jump in expenditures on doctors. Why would they have gone up by 44.8 per cent per capita between 1999 and 2009, when Canada was experiencing a doctor shortage?

Rather than leap to a knee-jerk conclusion — fatter paycheques — he dug into the records and discovered doctors were ordering more and costlier diagnostic tests each year. These procedures jacked up their medicare billings. Many appeared to be medically unnecessary.

He was less surprised by the 73.7 per cent escalation in per-capita drug expenditures. He had been tracking that trend for decades, as the global pharmaceutical giants gained political and financial clout.

Though persistent, these pressures can be managed, Evans says. Governments have the authority impose a ceiling on drug spending and bargain within it; they have the power to hold doctors accountable for the tests and medications they prescribe; they have the scope to use market mechanisms such as competitive bidding and bulk purchasing to slow the growth of spending.

Depending on his audience, Evans will go into specifics or offer big-picture solutions.

What won’t work, he says, is pouring more money — public or private — into the health-care system. That will only perpetuate the problem.

Nor will expanding the role of profit-seeking providers. They already account for the two fastest growing components of health spending: drugs and diagnostics. The more business they do, the more money they make.

“The inherent expansionary tendency of health care can best be contained within a public system,” Evans says. But it won’t happen automatically. Politicians have to apply the brakes.

He is not strident. He doesn’t churn out made-for-television quotes. He won’t pretend medicare is faultless or its critics are entirely wrong.

His allies would like to package him as a myth-busting white knight. But Evans doesn’t fit the part. He is a researcher who will always let the facts get in the way of a good story.

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