Morneau’s proposed tax changes attack doctors – and negatively impact patients

Posted on September 15, 2017 in Health Debates – Opinion

Dr. Shawn Whatley is the president of the Ontario Medical Association.

Finance Minister Bill Morneau wants people to think that his new taxes will only mean a little less champagne for small-business owners; no one else will notice any difference. But Mr. Morneau’s tax proposal will decrease access to medical care and make Canada an undesirable place to practice.

Government cannot attack doctors without harming patient care. Patients will first notice the change in doctors’ offices. The tax that Mr. Morneau plans to grab from doctors would otherwise stay as retained capital in medical corporations. Doctors use retained capital to upgrade offices, purchase equipment and hire staff. If the capital goes to taxes, patients will be seen in older clinical facilities, have less access to medical technology and have fewer staff caring for them.

When doctors cut spending on clinics, the community feels the impact, too. My rural clinic supports the tiny pharmacy in town. Without it, seniors would have to take a 2 1/2-hour round trip bus ride into a larger town to get their medications.

When doctors cannot buy technology – such as ECG machines – patients have to bear the cost of travelling to a lab or hospital for simple tests. Hospitals or public labs have to fund the staff and equipment that doctors would have otherwise funded, in their own clinics. Government-run clinics cost more than private offices. So, patients will have less access and the access that remains will cost the system more overall.

The second impact of Mr. Morneau’s taxes on medical care will take longer for patients to feel but causes more damage. In Ontario, the 1990s provide a 10-year test case about what happens to patient care when governments attack doctors. The Ontario government made deep cuts to medical funding and human resources, as politicians pursued their “social contract” agenda. Lower-paid doctors, such as those in family practice, struggled to pay office overhead. Medical students avoided training in family practice and residency spots went unfilled.

Family doctors chose focused practices in emergency medicine, sports medicine or as hospitalists. New doctors avoided the risk of starting a private practice. Doctors scrambled for salaried positions in community health centres, workers’ compensation or with the coroner’s office. Some doctors took extra training in non-medicare work, such as cosmetics and spa medicine.

Tax hikes and fee cuts have similar effects: They encourage doctors to adjust the care they provide. Years ago, I lamented about fee cuts to an older orthopedic surgeon. He shrugged and said, “I’ve got long wait lists for worker’s compensation and military work. I will just spend more time there. OHIP patients will have to wait longer.”

The 1990s left 1.2 million patients without a family doctor. Communities mounted massive recruitment campaigns. A former municipal politician from Belleville, Ont., said recently, “We were able to sign 15 docs. We paid them a bundle. I felt sorry for the smaller communities. There was no way they could compete.”

Orphaned patients ended up in emergency departments and walk-in clinics. Diagnosing diabetes in the emergency department became commonplace. Our hospital set up diabetes clinics because orphaned patients had no family practice to see for follow-up. The same happened for patients with dangerously high blood pressure, low functioning thyroid glands, angina and other conditions.

Finally, Mr. Morneau’s tax hike will force doctors to change career plans. Attacking doctors doesn’t make them work harder. We should encourage doctors to jump out of bed to see more sick patients in the middle of the night. Mr. Morneau’s plan will make some doctors retire or semi-retire. They will slow down and spend time with family. They will retrain, downsize their homes or find a paying hobby.

Paying 53 per cent of every dollar earned to government does not make sense. (Under the new proposal, Ontario residents earning more than $220,000 would be subject to income tax at a rate of 53 per cent.) As a last resort, doctors will move away. Although brain drain is the first thing people fear when governments attack doctors, it takes years to see the impact.

One writer suggested that doctors might work harder, to maintain their income. This should make patients worry. If doctors have to work harder because of tax hikes and fee cuts, it’s not the kind of work patients want.

Patients need doctors at the top of their game. More than 50 per cent of doctors are already burned out. We don’t need doctors who work more than they should or neglect self-care and work-life balance. No one wants to see a tired, burned out, disgruntled doctor, who may have been forced out of retirement because they cannot survive on the retirement plan they built for 20 years. Changing the rules for doctors at mid to late career is bad for doctors and patients.

Mr. Morneau’s tax changes will have a drastic impact on patient care. Doctors will change how they run their offices, adjust the kinds of care they offer and alter career paths. These changes will impact local communities and businesses that rely on medical clinics. But most importantly, Mr. Morneau’s tax proposals will negatively impact access to medical care. It will make Canada an undesirable place to practise medicine. Let’s hope Mr. Morneau changes his mind before he does something we will all regret.

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